Cincinnati Tax Lawyer: Tax Help - IRS Mission Statement


[ Back ] PERSPECTIVE: THE IRS IN TRANSITION Conference on the IRS Moderization http://www.irs.gov/hot/latnews.html "THE IRS MISSION STATEMENT" PROVIDE AMERICA'S TAXPAYERS TOP QUALITY SERVICE BY HELPING THEM UNDERSTAND AND MEET THEIR TAX RESPONSIBILITIES AND BY APPLYING THE TAX LAW WITH INTEGRITY AND FAIRNESS TO ALL (PUBLICATION 594, Catalog #46596B) The IRS Restructuring and Reform Act of 1998 (RRA '98) has profoundly impacted on the IRS. For many years, taxpayers and tax practitioners found many IRS employees difficult to work with and consistently inconsistent. Changes have come as a result of RRA '98 but so far at a very slow pace. According to the New York Times (May 18, 1999) "seizures of property are down 98% over the last two years. Levies and garnishments of bank accounts and paychecks are just one-fourth the level they were two years ago. And the filing of tax liens is down two-thirds". IRS examinations of tax returns are down from former years and the number of examinations is not expected to increase. Charles O. Rossotti, the Commissioner of the Internal Revenue Service, announced that the IRS is in the process of changing the way it does business. Commission Rossotti has outlined a new type of administrative structure to accomplish the primary goal of the Service to emphasize "service". In theory, taxpayers will now be looked on and treated as customers. Newly created IRS operating divisions structured along taxpayer/customer lines, are the main focus of the staged-in implementation. The pace of change is now accelerating at the IRS and employees are having a difficult time keeping up with National Office directives in an attempt to deal with the mandates of RRA '98. The result is that the IRS, in many instances, is doing everything possible not to take enforcement action. This is in part due to the fear among Revenue Officers and Automated Collection System (ACS) personnel of being personally sued under the provisions of RRA '98. You may have noticed that every IRS employee to whom you speak is now required to give his personal IRS employee identification number. MEET THE NEW IRS: Starting in January of 2000, the IRS is being totally restructuring. In the past, Cincinnati taxpayers were responsible to a single Cincinnati District Office consisting of local operating functions such as the Collection, Audit, Appeals and Criminal Investigation. The IRS is modernizing into a four (4) division national structure which will be in place by October, 2000. The former functions, e.g. collection and examination, will each now be administered under new national operation divisions. The four operating divisions are as follows: Wage and Investment Operating Division Small Business/Self-Employed Operating Division Large and Mid-Sized Business Operating Division Tax Exempt/Government Entities Operating Division Let's meet the IRS in terms of the two operating divisions which effect most Cincinnati residents and taxpayers. Cincinnati, by the way, will continue to have local IRS offices. There will, however, be fewer managers located in Cincinnati. WAGE AND INVESTMENT DIVISION The specific taxpayer segment serviced by the Wage and Investment Division will be returns reflecting W-2 income and investment income. The profile of this taxpayer is as follows: Most taxpayers pay taxes through withholding More than 50% prepare their own returns Most interact with the IRS once a year Most receive refunds This division will provide taxpayers (called customers) with information, support and assistance to fully understand their tax obligations. The division will be responsible for all taxpayer relations within the category including filing, processing of returns and payments and providing taxpayers with the status of their returns and resolving problems and inconsistencies. SMALL BUSINESS/SELF-EMPLOYED OPERATING DIVISION This division will be responsible for the category of taxpayers who are fully or partially self-employed. Businesses with assets under $5,000,000.00 will be monitored by this operating division. The taxpayer profile of this division is as follows: Have some of the most complex issues found in tax law Have 4 - 60 routine transactions with the IRS per year Small businesses without employees Small businesses with employees Taxpayers with rental properties Taxpayers with farming businesses C Corporations, S Corporations, Limited Liability Companies and partnerships with assets under $5,000,000 Individuals filing Schedules C, E, F or Form 2106 In general, this operating division will assist taxpayers in submitting accurate and timely returns and remitting the proper amount of tax. Their focus will be on processing returns timely and accurately with the mission of assisting taxpayers with account specific questions and adjusting accounts as necessary. Their primary compliance focus will be on problem prevention and early intervention to increase overall compliance and fairness. CONCLUSION Time will tell if we have a friendlier and kinder Internal Revenue Service. There continues to be strong language in the Internal Revenue Manual emphasizing a "risk based compliance" system that puts resources on taxpayer cases at the appropriate time. Despite Commissioner Rossotti's comments, compliance is not a forgotten word and the IRS is still charged with focusing on "problem prevention" and "early intervention" in non-compliance situations. In this writer's opinion, the next 12 to 24 months will see a time of confusion at the IRS with conflicting IRS internal directives, re-organization issues, and taxpayer difficulties in communicating with IRS employees who can actually resolve taxpayer issues. [ Back ]

PERSPECTIVE: THE IRS IN TRANSITION

Conference on the IRS Moderization
http://www.irs.gov/hot/latnews.html

"THE IRS MISSION STATEMENT"

PROVIDE AMERICA'S TAXPAYERS TOP
QUALITY SERVICE BY HELPING THEM
UNDERSTAND AND MEET THEIR TAX
RESPONSIBILITIES AND BY APPLYING
THE TAX LAW WITH INTEGRITY AND
FAIRNESS TO ALL (PUBLICATION 594,
Catalog #46596B)

The IRS Restructuring and Reform Act of 1998 (RRA '98) has profoundly impacted on the IRS. For many years, taxpayers and tax practitioners found many IRS employees difficult to work with and consistently inconsistent. Changes have come as a result of RRA '98 but so far at a very slow pace.

According to the New York Times (May 18, 1999) "seizures of property are down 98% over the last two years. Levies and garnishments of bank accounts and paychecks are just one-fourth the level they were two years ago. And the filing of tax liens is down two-thirds". IRS examinations of tax returns are down from former years and the number of examinations is not expected to increase.

Charles O. Rossotti, the Commissioner of the Internal Revenue Service, announced that the IRS is in the process of changing the way it does business. Commission Rossotti has outlined a new type of administrative structure to accomplish the primary goal of the Service to emphasize "service". In theory, taxpayers will now be looked on and treated as customers. Newly created IRS operating divisions structured along taxpayer/customer lines, are the main focus of the staged-in implementation.

The pace of change is now accelerating at the IRS and employees are having a difficult time keeping up with National Office directives in an attempt to deal with the mandates of RRA '98. The result is that the IRS, in many instances, is doing everything possible not to take enforcement action. This is in part due to the fear among Revenue Officers and Automated Collection System (ACS) personnel of being personally sued under the provisions of RRA '98. You may have noticed that every IRS employee to whom you speak is now required to give his personal IRS employee identification number.

MEET THE NEW IRS:

Starting in January of 2000, the IRS is being totally restructuring. In the past, Cincinnati taxpayers were responsible to a single Cincinnati District Office consisting of local operating functions such as the Collection, Audit, Appeals and Criminal Investigation.

The IRS is modernizing into a four (4) division national structure which will be in place by October, 2000. The former functions, e.g. collection and examination, will each now be administered under new national operation divisions. The four operating divisions are as follows:

Wage and Investment Operating Division
Small Business/Self-Employed Operating Division
Large and Mid-Sized Business Operating Division
Tax Exempt/Government Entities Operating Division

Let's meet the IRS in terms of the two operating divisions which effect most Cincinnati residents and taxpayers. Cincinnati, by the way, will continue to have local IRS offices. There will, however, be fewer managers located in Cincinnati.

WAGE AND INVESTMENT DIVISION

The specific taxpayer segment serviced by the Wage and Investment Division will be returns reflecting W-2 income and investment income. The profile of this taxpayer is as follows:

Most taxpayers pay taxes through withholding
More than 50% prepare their own returns
Most interact with the IRS once a year
Most receive refunds

This division will provide taxpayers (called customers) with information, support and assistance to fully understand their tax obligations. The division will be responsible for all taxpayer relations within the category including filing, processing of returns and payments and providing taxpayers with the status of their returns and resolving problems and inconsistencies.

SMALL BUSINESS/SELF-EMPLOYED OPERATING DIVISION

This division will be responsible for the category of taxpayers who are fully or partially self-employed. Businesses with assets under $5,000,000.00 will be monitored by this operating division. The taxpayer profile of this division is as follows:

Have some of the most complex issues found in tax law
Have 4 - 60 routine transactions with the IRS per year
Small businesses without employees
Small businesses with employees
Taxpayers with rental properties
Taxpayers with farming businesses
C Corporations, S Corporations, Limited Liability Companies and partnerships with assets under $5,000,000
Individuals filing Schedules C, E, F or Form 2106

In general, this operating division will assist taxpayers in submitting accurate and timely returns and remitting the proper amount of tax. Their focus will be on processing returns timely and accurately with the mission of assisting taxpayers with account specific questions and adjusting accounts as necessary. Their primary compliance focus will be on problem prevention and early intervention to increase overall compliance and fairness.

CONCLUSION

Time will tell if we have a friendlier and kinder Internal Revenue Service. There continues to be strong language in the Internal Revenue Manual emphasizing a "risk based compliance" system that puts resources on taxpayer cases at the appropriate time. Despite Commissioner Rossotti's comments, compliance is not a forgotten word and the IRS is still charged with focusing on "problem prevention" and "early intervention" in non-compliance situations. In this writer's opinion, the next 12 to 24 months will see a time of confusion at the IRS with conflicting IRS internal directives, re-organization issues, and taxpayer difficulties in communicating with IRS employees who can actually resolve taxpayer issues.

[ Back ]

Cincinnati Tax Lawyer
4555 Lake Forest Drive Suite 365
Cincinnati, OH 45242

Phone: (513) 563-4555
Fax: (513) 563-9097
E-Mail: tjutaski@cincinnatitaxlawyer.com