U.S. Taxpayer Advocate Nina E. Olson has recommended to Congress that the IRS improve critical areas of its customer services at a time when more taxpayers every day are “have difficulty paying their daily living expenses.”
In her FY 2010 Objectives Report to Congress (.pdf), Taxpayer Advocate Olson recommended that the IRS “reinvigorate its efforts to pursue cross-functional, research-driven service improvements,” which translates to putting renewed effort into the Taxpayer Assistance Blueprint, intended to help the IRS better understand and respond to the needs of taxpayers.
Olson also recommended that the IRS give a major facelift to its Offer In Compromise Program (OIC), intended to allow financially strapped taxpayers make manageable, scheduled payments on their tax debts.
According to Olson, the sheer complexity and amount of information required on the OIC application forms deters many taxpayers from taking advantage of the service. As evidence, Olson cites a 72 percent decrease in the number of accepted OIC applications over just the last seven years.
Olson also recommended that the IRS should step up its enforcement efforts against commercial federal tax return preparers “who fail to perform due diligence or consciously facilitate noncompliance,” rather than against their taxpayer victims.
The advocate’s report also expresses concern over the IRS’s “sharp decline” in telephone service to taxpayers. The “Level of Service” on IRS toll-free assistance lines (the percentage of taxpayers who actually get to speak to an IRS human) fell from 87 percent in 2004, to just 53 percent in 2008. While the IRS blames much of the decline in service last year to a sharp increase in calls about Economic Stimulus Payments, Olson said, “that is small comfort to taxpayers who need assistance and it does not bode well for taxpayer compliance.”
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