Area 1 Committee Meeting Minutes

March 25, 2003
Teleconference

Opening of the Meeting
Chairperson Fish opened the meeting at 1:04 PM Eastern Time and welcomed all members and guest, former CAP member Anthony Fandozzi, to the meeting.

The Chair gave a briefing on the Joint Committee's attempt to gather as many issues as possible prior to their forthcoming face-to-face meeting on May 2, 2003.

Roll Call

Panel Members Attending

• Aimee Brace, NY
• Elizabeth Brodbine-Ghoniem, MA
• Walter Fish, NY, Chair
• Peter Gorga, Jr., DFO
• James Grimaldi, Vice Chair
• Catherine Kelly , ME
• Diane Mignano, RI
• Paul Nagel, NY
• Shamsey Oloko , NY
• Eileen Shuman, VT
• Charles Silva, MA

Panel Members Absent

• Abigail Alicea, NH
• William Gedge, CT

TAP Staff Attending

• Nancy Ferree, TAP Program Manager
• Marisa Knispel, TAP Program Analyst

Guest

• Anthony Fandozzi

Issue on Attendance
Chair Fish explained that some committees adopted the operating rule that if a member misses three meetings he/she may be voted out. He said that this committee has not faced that problem and if someone is to miss a meeting, the committee should be given advance notice. He asked for members' opinions on the matter. Member Silva agreed that this restriction should not be implemented. No objections.

Meeting Minutes
Chair Fish led discussion on prior meeting minutes. Member Silva motioned to accept the minutes and Brace seconded the motion.

Subcommittee Reports
Member Shuman, member of Penalty Abatement Subcommittee, explained that she has not spoken to Member Gedge (lead) on the issue lately. She was in Washington D.C. and discussed the incident of a particular taxpayer who received the wrong notice. IRS admitted negligence. While in D.C., she was provided with language to change the context of the “stall” notice to taxpayers and with other answers to the subcommittee's questions. She will share her findings with the subcommittee in a future teleconference.

She continued to update members on her other issue of the inflation vs. deductions and phase-outs. She has not actively worked on this issue, but recognizes that the issue is so broad that may have to be divided into separate issues. Some of these issues, although legislative in nature, need to be revisited. Nevertheless, Shuman believes that any recommendation made by the subcommittee should be forwarded to NTA Nina Olson. Member Brace agreed with Shuman that this is an overwhelming issue and that even its approach is an issue onto itself. The issues should be analyzed and recommendations forwarded to the NTA. Member Shuman was happy to find support on the issue from a TAP website comment received from a taxpayer who in his comments supports her view. She continued to explain the views of an Area 2 TAP member on how to handle legislative issues. DFO Gorga reiterated that members should not be dissuaded from working legislative issues but should forward recommendations to the IRS National Office for possible inclusion in the NTA's Report to Congress.

Continuing on the inflation discussion, Chair Fish advised that the main concern should be the relation of deductions and credits to inflation, not the phase-out and suggested that the issue of AMT be included as part of the study. Member Kelly mentioned that the Schedule R should also be reviewed since its eligibility parameters have not changed in ten years. At this point, member Shuman invited any other member to join this subcommittee. No one volunteered.

Member Grimaldi updated the members on the issue of 911 grants. He has been receiving a lot of feedback from members of the World trade Center Association and attended a meeting with the Lower Manhattan Business Development Association which is aimed to enhance business growth in downtown Manhattan . He stated that although he was advised not to conduct visits to congressional offices as a representative of TAP, he has been receiving phone calls from Congresswoman Maloney's office with referrals on affected taxpayers protesting the taxability of business grants. He has forwarded his notes and concerns to the congressional office, not as a TAP member but as a concerned citizen. Just last week, he indicated, IRS released a notice stating that business grants given to victims of September 11 th are taxable. Grimaldi stated that he recognizes that the 911 grants is a local issue and Member Silva stated that even though local, it has merit since the situation may reoccur in another part of the country with another disaster.

Discussion ensued on the treatment of disaster (FEMA) grants. Hence, the Chair suggested to the committee that the 911 issue might be addressed in conjunction with the taxability of other disaster grants.

Member Silva is perusing the issue of flat tax originally raised by Member Shuman. He has done much research but the study is broad.

Member Shuman related a taxpayer's comment sent to her on the topics of residency, health insurance and Medicare. After discussion, the members agreed that this is not within TAP's scope.

Member Kelly indicated that she sent her “toll-free” proposal to Brace for formatting and asked the Chair if he'd seen it. Chair Fish will follow up on it.

New Issues
Member Grimaldi proposed for the committee to consider the issue of extensions. The four-month extension to file the tax return is automatic, giving the taxpayer until August 15 th to do so. In his experience, the second extension, which is a petition to the IRS to extend the time to file the return until October 15th, has always been granted. Thus, he sees this granted “rubber-stamped” petition as a waste of paper and time. Also, he added, other state and city agencies grant an automatic six-month extension. Member Silva supported Grimaldi's recommendation. He also raised the question of why have the existing four-month extension, since it is automatic, why not just delay the filing deadline until August 15th. Member Nagel emphasized that the extension to file is not an extension to pay. Analyst Knispel will research the logic and purpose of the two extensions.

Outreaches
Chair Fish reminded members about the importance of outreach and sending the TAP Speaker Report to Analyst Knispel.

Future Meeting Planning
June meeting in Andover was discussed and Analyst Knispel will be sending hotel information via email. Chair Fish announced that local New York members were invited to tour the Brookhaven Service Center and extended the invitation to all members.

Public Input
Chair invited Anthony Fandozzi to share comments on the meeting and TAP. As former CAP member and Vice-Chair of the NY/Metro CAP, Mr. Fandozzi has been following news on TAP. He is impressed with the virtual way of communication that members use, via email and teleconference. He is also impressed with the minutes of this committee as they are readable and easy to follow. He thanked Analyst Knispel for this.

Closing Assessment
Member Kelly shared the story of taxpayers who purchased a camper and found money which they turned over to the local police. The taxpayers are being taxed for the amount from the time they found it until they return it to local authorities. DFO Gorga indicated that when a taxpayer reports someone to the IRS for misuse of funds and gets a reward, the reward becomes taxable as income.

In closing, DFO Gorga shared his background with members and stated that he was happy to be part of the committee. Chair Fish closed the meeting at 2:00 PM EST thanking everyone for their participation.