Area 1 Committee Meeting Minutes

July 22, 2003
Teleconference

Opening of the Meeting
Chairperson Fish opened the meeting at 1:05 PM EDT by welcoming all participants. He mentioned the TAP Annual Meeting in Washington D.C. on October 2nd through the 4th. Fish asked the committee about establishing ground rules for attendance. Gedge reminded him that at the face-to-face meeting, all members agreed that Chair would follow up with the absentee member. Ramirez asked Fish to speak to her about this after the teleconference. Fish offered if no one had comments about the Agenda, it would be accepted. No one objected.

Roll Call

Panel Members Attending

• Aimee Brace, NY
• Elizabeth Brodbine-Ghoniem, MA
• Walter Fish, NY, Chair
• William Gedge, CT
• Peter Gorga, Jr., NY, DFO
• James Grimaldi, NY, Vice Chair
• Catherine Kelly, ME
• Diane Mignano, RI
• Paul Nagel, NY
• Charles Silva, MA

Panel Members Absent

• Abigail Alicea, NH
• Shamsey Oloko, NY
• Eileen Shuman, VT

TAP Staff Attending

• Marisa Knispel, TAP Program Analyst
• Sandra Ramirez, TAP Program Manager

IRS Presenters

• Mary Ann Silvaggio, Area 1 Taxpayer Advocate
• William R. Swartz, Director of Low Income Tax Clinics (LITCs)

Subcommittee Reports
Fish asked members if they had read the ITIN proposal submitted by Ghoniem and if they had any comments or modifications. Silva motioned to forward proposal. All members agreed.

The Quality Control proposal was reviewed next and again Fish asked for any comments or suggested modifications from the members. Gedge asked for clarification on the recommendation made. Ghoniem recommended establishing a quality control process that reviews IRS letters that require the employee to pick and choose paragraphs from a database. She explained that it would take time for the committee to develop a process mainly since at this time they do not know what the current process is. Gedge said that he was sure that the IRS had criteria on choosing paragraphs. Ghoniem reminded the members that they were told that the letter resulting from this process was not reviewed. Analyst Knispel will research the quality review process of letters in which IRS employees pick and choose paragraphs and provide the Committee the information.

Kelly asked if the next IRS employee contacting the taxpayer would have reviewed the previously sent letters. Gedge added that if the IRS employee chose the wrong paragraph, would it be reviewed? Would the employee be educated about it?

Ghoniem asked if there is an ongoing level of training for these employees. Fish recommended a “spot check” of the outgoing letter and education to the employees working on letters.

Gorga proposed modifying the recommendation to suggest a periodic quality sampling. Any specific issues or problems on the letters could then be addressed through education.

Silva asked for the issue to be tabled. Ghoniem will rewrite the proposal accordingly pending Knispel's research.

Next, Fish discussed Grimaldi's proposal on the EFTPS issue. Consensus was reached in sending the proposal forward. Grimaldi will reformat the proposal to be ready for the Joint Committee.

The next topic was the fee charged for Offers-In-Compromise. Ghoniem submitted a proposal on this issue. Gedge asked: If any taxpayer submitted an OIC without the fee, would it be rejected? Gorga explained that the offer would be suspended, the IRS would contact the taxpayer requesting any information and then continue its processing upon receipt of the information. The IRS would research the taxpayer's financial situation to deem whether he/or she is below or at the poverty line and waive the fee. Fish stated that someone in the poverty line should not have any income taxes. Grimaldi added that a person's financial situation could change. Gorga said that he believed that the $150 fee has not been put in place yet. Knispel will research if a fee is currently being charged to filers of OICs; if not, when it will be enacted and what, if any, are the waiver requirements.

Ghoniem added that she forwarded the proposals on OIC and ITIN to Deryle since Deryle had asked this to be done so that they may assist NTA Olson who was working on the same issues.

Gedge had a concern about the circumstantial waivers, a recommendation in the OIC proposal. He stated that this type of criteria involves a subjective decision. Specifically, he is concerned that if IRS applies subjective criteria in one instance, others will ask that the IRS apply them in their own case. Fish, Kelly and Grimaldi motioned to revise the proposal and forward it. Analyst will research, as noted above, revise and forward.

New Issues
Kelly forwarded her proposal on self-employment tax for newspaper carriers to Shuman for formatting. Kelly will follow-up with Shuman.

Members discussed the letter Grimaldi shared with members on Grimes Tax Filing regarding the child tax credit and notifying recipients with a Form 1099. People tend to forget about these credits received and do not account for it on their tax returns. Fish stated that this was a timing issue. Ghoniem volunteered to write a proposal on this issue by next week.

Fish asked if we could recommend doing something about preparers who prepare frivolous returns. Kelly said that in her participation with the Congressional delegations, she found this to be a subject everyone was interested in, particularly at the State level. Discussion ensued. Members agreed to table issue since other committees are working it.

Swartz stated that CA, OR and MN are the only states with regulations on the books on this issue. The IRS and TAS have studied this “poor preparer” issue. The fundamentary concern is how does the IRS address issue without becoming a regulatory body?

Kelly asked Fish to inquire about what the Joint Committee is doing with the proposal of EITC outreach within the areas. She said that Mignano would be interested in participating in this effort but that members should know what local coalitions or organizations are involved with EITC and to what extent they are working on it.

Presentations
Fish introduced Director of LITCs Swartz to give his presentation. Swartz said that LITCs serve low-income taxpayers meeting the poverty guidelines set forth by Dept. of Health and Human Services (HHS). The clinics' role is to represent the taxpayers in controversy, whether in Tax Court or with the IRS. The clinics usually are non-profit 501© organizations, or affiliated with a law or business school. Some clinics focus on English As A Second Language. There are currently one hundred and thirty-eight clinics in all the states, except for Vermont, Wyoming and Puerto Rico. The listing of the clinics can be found in the IRS website, www.irs.gov. For the upcoming FY 2004, over 200 applications have been received. The IRS is providing $7 million in matching funds, up to $100,000 per clinic.

The clinics are also responsible for doing the marketing and publicizing for their own individual clinic. They also conduct outreach on IRS issues such as the EITC.

The LITC Program, as of May 1, 2003, falls under the jurisdiction of the National Taxpayer Advocate Nina Olson. Changes, thus far made by the NTA include certain amount of staff and tax specialists, a tax law library, qualified volunteers, CPE for staff and volunteers and a mentoring program for the new clinics. Swartz stressed that the LITCs were not intended to provide tax preparation, such as VITA sites do. Tax preparation is limited to the extent it relates to the controversy issue the clinic is helping the taxpayer with.

Fish asked if he could go to Hofstra University and talk to them about establishing a LITC? Swartz said yes he could educate them on the purpose of the clinics and the opportunity to become one by applying for a grant. Swartz took the opportunity to ask members that they mention the LITC Program on their outreach efforts. Also, he asked them to mention the existence of the English As A Second Language clinics. He gave members the phone number for the LITC office. The person to contact is Susan Gilbert at 404-338-7185.

Ghoniem said that she met with two LITCs in Florida and was impressed with their marketing materials in two languages. Swartz replied that that is exactly what he is trying to do at the moment, to assess the best practices used by existing clinics and share the information with the other clinics. She added that a concern the clinics had was that they had to reapply for the grant every year. The application process should be every two or three years. Swartz agreed and said that the application instructions are forty-four pages long. He also provided members with the e-mail address for questions on the LITC Program; LITCprogramoffice@irs.gov. Again, Swartz encouraged their participation to disseminate the LITC Program information during outreaches.

Fish introduced the NY/NE Area Taxpayer Advocate Mary Ann Silvaggio. She said that she met Fish in the Atlantic City Tax Forum and she wanted to meet the rest of the members. She talked about her Examination background. She said that she is impressed with the members' dedication. Silvaggio gave her office phone number, (212-298-2072) and offered to assist anyway she can.

Report on Joint Committee
Fish mentioned the Joint Committee's plan to propose that some members remain on for a third year to help in the transition with the new panel members. The members would also have the opportunity to change issue committees in the new fiscal year.

Also, Fish told members that legislative changes will go directly to NTA Olson and Director Temple.

National Tax Forum in Atlantic City
Fish spoke about his attendance at the Forum. They met new IRS Commissioner Everson. Fish heard the IRS toll-free customer service issue as the main issue of complaint from forum attendees.

Public Input
None.

Closing Assessment
Chair Fish said that it was a good meeting. All agreed.

Ramirez stated that a formal outreach plan was being prepared for the new fiscal year and asked members for input on ideas to incorporate on the plan.

Kelly excused herself from attending the next teleconference on August 26th due to a conflict with traveling to an issue committee.

Meeting closed at 2:35 PM EDT.

Next teleconference will be on Tuesday, August 26, 2003 at 1PM EDT.