Date: November 9, 2002
Location: Providence, Rhode Island

Opening of the Meeting
Chairperson Fish opened the meeting at 10:05AM Eastern Time and welcomed all participants.

Panel Members Attending

• Walter Fish, NY, Chair
• James Grimaldi, NY, Vice Chair
• William R. Swartz, NY, DFO
• Abigail Alicea, NH
• Aimee Brace, NY
• Catherine Kelly, ME
• Diane Mignano, RI
• Paul Nagel, NY
• Shamsey Oloko, NY
• Eileen Shuman, VT
• Charles Silva, MA

TAP Staff and IRS Staff Attending

• Marisa Knispel, TAP Program Analyst
• Nancy Ferree, TAP Program Manager
• Barry S. Levine, W&I Program Analyst

Meeting Schedule
Chair Fish revised the schedule for upcoming teleconferences. A change was made from monthly teleconference on the first Monday of each month to the last Tuesday of each month. An exception will be in December 2002 when the teleconference will be held on December 3rd.

Outreach Speech Presentation
Chair Fish presented a speech he wrote for use in Outreach presentations. The speech gave a brief history of CAP and reorganization to TAP, the aim of TAP and the dedication in the volunteerism of TAP members.

After a brief critique, all members offered consensus on using this speech for Outreach activities.

Reaching the Public
DFO Swartz discussed outreach and marketing materials. Members reviewed materials used in CAP.

Also, DFO Swartz mentioned the opportunity of having a training session with media specialist on exploring ways to deal with media and outreach opportunities.

Member Shuman indicated that all Area 1 members as well as remaining members of the TAP Panel should be notified of Issue Committee activities. All members agreed to give a briefing of their Issue Committee's activities at each Area 1 meeting.

DFO Swartz explained that as a Local Taxpayer Advocate, he is involved in outreach opportunities. He agreed to filter Outreach Program information in the NYC/ Long Island area to local members. He also suggested that other members contact their Local Taxpayer Advocate for this information within their area.

The logistics of outreach presentations were discussed. Members were advised to obtain approval from Analyst Knispel or DFO Swartz prior to outreach presentations that require budgetary funds.

The TAP Speaker Request Form was discussed as a useful tool to maintain statistical information on outreach activities done by Area 1 members. After an outreach presentation, the member should complete this Form and forward it to Analyst Knispel for recording.

Member Shuman informed the members of the opportunity she received from her employer to announce her involvement in TAP in the company's newsletter. This opportunity would carry the message to 20,000 employees.

This information ensued a discussion on the many vehicles available to reach the public. Newsletters, public presentations, and participation in trade shows, tax forums and fairs are among the possibilities considered. DFO Swartz pledged support from TAP staff and IRS in these activities.

Using E-mail
A discussion evolved on the excessive use of e-mail. Members, DFO and Analyst agreed to use the terms of "FYI, Action Required, Urgent" to define the importance and urgency related to specific e-mail.

October 8th Meeting Minutes
Minutes for October 8th Meeting in Alexandria, VA were approved by consensus.

Schedule and Location of Future Meetings
Members discussed possible locations for future Area 1 meetings. Suggestions made were Portsmouth, NH, Manchester, NH, Brattleboro, VT, Buffalo, NY and Brooklyn, NY. Analyst Knispel will study cost estimates for these locations before selection is made.
Subsequently, dates and time of meetings will be discussed. The locations chosen will supersede those selected in the past.

Issues Discussed
DFO Swartz emphasized the importance of communicating to the TAP organization the issues concerning the public. Any member who is presented with an individual issue from a resident of his/her area should communicate this issue or concern to the rest of the committee. Any member's personal concerns with the tax system should also be addressed.

Following this, Member Nagel introduced the issue of backup withholding. A 30% withholding of income reported on a Form 1099 is imposed when a taxpayer neglects to file a tax return or provides and incorrect taxpayer identification number (TIN). When the taxpayer complies with regulations, the IRS reviews the case and cancels the withholding by notifying the financial institution(s). However, Member Nagel explained that IRS conducts this process of cancellation and notification only once a year, in January. The process is unfair and should be reviewed. Member Nagel recommended that the process be studied and analyzed with the possibility of changing it to a quarterly or semiannual review.

Member Shuman recommended creating a universal form for issues presented in TAP. The form would allow members to 1) be aware of the issues 2) analyze and study possible ramifications that the issue may present.

Member Kelly discussed IRS's local office number. Calling this number costs $1.00 per call and the caller is introduced to a recorded message but no live assistance. Analyst Barry Levine, who specializes in Field Assistance, explained that the caller has the option to leave a message and will receive a response from an IRS employee the same day. Members understand that availability of the local IRS office numbers is due to a Congressional mandate, but recommend that this number be published with the warning "recorded message" in the local phone books.

Members reached consensus on conducting a study on flat tax rate. The study should include statistics on the number of taxpayers who advocate this tax policy. Analyst Levine explained that this issue has been a long time study of Treasury's Assistant Secretary for Tax Policy Pamela Olson. Analyst Knispel will research this issue.

Member Shuman inquired about the modification in the tax law for income requirements applicable to deductions and credits in the individual tax return to meet inflation changes. Analyst Knispel will research these requirements and phase-out limitations and their relation to inflation factors.

Vice Chair Grimaldi presented a NYC local issue regarding grants given to individuals and businesses affected by the disaster of September 11, 2001. The grants, established by Congress, are not addressed by prior tax rulings. The grants given to individual taxpayers are, as interpreted by the IRS, exempt from taxation while the grants to businesses are not. This seems to be inequitable and unfair treatment or businesses and corporations. The law is not well defined on this issue and the committee wishes to study the law to make a possible legislative recommendation. DFO Swartz addressed the equity and fairness of the tax treatment of these grants as compared to other grants. Again, Analyst Knispel will research this issue.

Member Oloko discussed IRS policy of free tax preparation in the Taxpayer Assistance Centers (TACs). Member Oloko feels that IRS's policy on restricting taxpayer's income to a specific dollar limit in order to receive this free service ($34,000 in tax year 2001) is unfair to the public and a cause for EITC under claims. Member Oloko suggested that IRS increase the advertising of the free tax preparation service.

Analyst Barry Levine analyzed the discussion and offered the cause and effect of this free tax preparation issue in relation to over and under claims of the EITC. He also explained that the Refund Anticipation Program is a reason why many taxpayers opt to seek the services of a paid tax preparer. Also, the Agency's recent change to the exclusive practice of e-file tax preparation and the policy of not preparing Schedule C have become major factors in the decreased use of IRS's free tax preparation service in TACs. Analyst Levine continued the discussion on IRS' services by explaining the Agency's staffing and funding problems to meet a more advertised IRS free tax preparation program. He referred to other IRS programs that offer free tax preparation such as VITA, TPE, etc. as ways to service the public.

As an end to the Area 1 Committee's discussion of issues, DFO Swartz suggested the creation of subcommittees on the issues discussed and the election of a spokesperson per subcommittee. Members shared consensus in electing Paul Nagel as spokesperson of "Backup Withholding", Eileen Shuman as spokesperson for "Inflation Factors" and "Flat Tax Rate", Catherine Kelly for "Toll-free Issues" and James Grimaldi for "9/11 Grants"

Old CAP Issues
Vice Chair Grimaldi reviewed the issues and recommendations of the former CAP Panel. Among the issues were a Tax Fraud Referral Program proposal, additional placement of kiosks, Small Business Workshops, Federal Tax Deposit Coupons, check box initiative, changes to Form 4868 and educational videos.

Program Manager Ferree suggested research be made on the current stage of IRS's process to follow up on these recommendations. Analyst Knispel will do research.

Partnership For Change Video
All participants viewed an eight-minute video entitled "Partnership For Change". The video showed former Florida CAP members who explained the purpose of the Citizens Advocacy Panel. After this video, members watched a thirty-second Public Service Announcement produced in Florida. Program Manager Ferree informed the members that audiocassettes were also available. These cassettes were distributed to radio stations in Florida and the videotapes were played in post offices throughout the state. All members enjoyed the videotapes and concurred that a new one should be produced for TAP as an outreach tool for the Program. Analyst Knispel will inquire with IRS Communications on a new video production and on a Power Point presentation of this material.

Closing of Meeting
Acting Chair James Grimaldi closed the meeting at 2:00PM, EST.