October 4, 2003
(8:30 AM – Noontime EDT)

Grand Hyatt Washington Hotel
1000 H Street NW-Arlington Conference Room
Washington, D.C.

Welcome/Announcements
Chair Mary Balmer began meeting by welcoming everyone and sharing that currently there is no representation from South Carolina on this committee nor has there been a replacement made for a vacant slot from Pennsylvania.

Panel Member Leonard Steinberg shared that since Panel Member Denise Bigger (which Leonard works with in the Payroll Taxes Issue Committee) has recently moved to the State of North Carolina from Iowa is there a possibility that she be allowed to represent the State of South Carolina. (Action/follow-up item for DFO Romito)

Roll Call- was taken by Program Analyst Inez E. De Jesus.

Quorum= is 10 and 12 members were present.

Panel Members Present

• Mary Balmer, Chairperson, NC
• Lou Romito, Designated Federal Official (DFO)
• Anthony DiMartino, NJ
• Morgan C. Edwards, NC
• Jerry Gensiejewski Jr. PA
• Calvin Johnson, VA
• Karen Kerrigan, VA
• Robert Maziarz, NJ
• Patrick McCombie, DE
• Theodore Perros, D.C.
• Leonard Steinberg, NJ
• Faith Vinikoor, MD

Members Not Present

• Richard Bobb, NC
• David Meyer, Vice-Chair, NJ
• Manning H. Mosley III, PA
• George Pruchniewski, MD
• Robert Taylor, PA

TAP Staff

• Inez E. De Jesus (Program Analyst/Scribe)

Review/Approve Meeting Minutes- August 5, 2003 & September 2, 2003
Minutes were approved for both August 5 and September 2, 2003 meetings.

Confirmation/Election of Chair & Vice-Chair
Mary Balmer expressed gratitude to the committee for their support during the past year as she served as the committee's Chair; she also went on to share that although this has been a very fulfilling experience for her, she wishes to step down as Chair at this time. Balmer opened the floor to anyone interested in becoming Chair.

Theodore Perros expressed that David Meyer has indicated an interest in the Chairperson position. There was no opposition. (Vice-Chair Meyer was not able to attend this portion of the TAP Conference).

The committee agreed by consensus (and to be effective immediately):

• Area 2 Chair: David L. Meyer
• Area 2 Vice-Chair: Mary Balmer

Vice-Chair Balmer led the meeting and promised to inform Meyer of his new position.

Recommendation: TAP on “Tax Talk Today”
Balmer shared that she has been looking into the possibility of scheduling TAP on Tax Talk Today. Panel member Jerry Gensiejewski mentioned that this was an action item for the Ad Hoc Committee, and he agreed to follow up on this.

Action item(s) from Prior Meeting
Issue #2259- Offer-in-Compromise (OIC) Processing Procedures - this is a follow-up to September 2, 2003 teleconference meeting. (Decision to pursue this issue did not occur since there was no quorum)

In essence, issue submitted from an Enrolled Agent, New Jersey : “OIC procedures need to be revised so that when an offer comes into the service centers, they immediately screen them to see if they are going to be worked in the Service Center or transferred to the field.”

DFO Romito referenced Treasury Inspector General for Tax Administration-(TIGTA's) Report # 2003-30-182- “Continued Progress is Needed to Improve the Centralized Offer in Compromise Program”.

Panel member Karen Kerrigan mentioned that the Schedule C-Non-Filer issue committee she serves on is also addressing an aspect of the OIC program. She would look into this further and get back to the committee. (Action: Kerrigan)

Committee also addressed that in the National Taxpayer Advocate's Report to Congress, Fiscal Year 2004 Objectives, pages 9 and 10, there is indication that the OIC issue/problem is on the NTA's radar screen and will be monitored.

Action item for DFO Romito: Since the committee is considering looking into ways to making improvements to the initial screening, field assignment, and processing time of OIC cases, DFO Romito will make inquiries on what is currently being done within the IRS so that the panel does not duplicate efforts.

In the interim, this issue will be placed in Parking lot and depending on DFO Romito's follow-up information, this issue may be prioritized for the committee to address.

An interim response was sent to the Enrolled Agent that brought this issue to the panel's attention on September 5, 2003, approved by David Meyer.

Panel member Leonard Steinberg suggested that Analyst De Jesus review Systemic Advocacy database system (SAMS) when issues first arrive, and analyst shared that she currently is doing this.

Status Reports from Sub-committee Chairs
Issue #1309- Patrick McCombie, Subcommittee Chair, informed all that the subcommittee continues to review ways to simplify the forms and instructions related to Form 1041, U.S. Income Tax Return for Estates and Trusts. For example, the subcommittee is reviewing Publication 559-“Survivors, Executors, and Administrators”, and the committee in general agrees that one perspective is that the taxpayer just needs to know if they need to file Form 1041, and if so what documents they need in order to do so.

Panel member Faith Vinikoor shared a report she prepared entitled “Proposal for Form 1041EZ- A Review of An Alternative Suggestion”; she indicated that the template originally submitted by John Darazsdi, an IRS Estate Tax Attorney during Area 2's face-to-face meeting in Philadelphia last June was reviewed and the following 3 options for the committee to consider were brought to the floor:

• Elevate the Form 1041EZ concept as a separate proposal. This would involve gathering additional statistical information and developing a more sophisticated version of the 1041 EZ, which would incorporate some of the items that were not addressed in the current version.
• To satisfy Question 3 under Proposed Criteria for TAP Recommendation, incorporate the information gathered in this report into the current project to revise the instructions for the Form 1041. Question 3 asks, “What alternatives were reviewed?” and “What are the pros and cons for each?”
• Based on the information gathered and input from the National Office Analyst involved with the Form 1041, do not pursue this portion of the 1041 initiative. It appears that there has been some thought to making the electronic filing of this form more palatable to the preparer community and simplification may already be in the works or on the horizon for the future.

Action item for Analyst De Jesus:

1. Find out if there is a more simplified 1041 form in the works. (For the record, response: “no”)
2. Establish a subcommittee teleconference meeting with National Office Program Analyst Chuck Frank. Analyst requested that all questions for Chuck Frank be sent to her.

Leonard Steinberg expressed an interest in participating with this subcommittee. Committee agreed that they need to get input from individuals who have experience in using this form.

For the record, 1041 Subcommittee participants are: McCombie, Balmer, Meyer, DiMartino, Mosley III, Vinikoor, and Steinberg.

Short-term goal: Committee to pursue simplifying the instructions and clarifying certain concept for now.

Long-term goal: Committee is to consider proposing a Form 1041-EZ.

Issue # 494- Subcommittee Chair Bob Maziarz shared that he has been in contact with the taxpayer that originally made a suggestion regarding having an option to have a percentage withheld from one's Form W-4, “Employees Withholding Certificate” . This would affect line 6 on the W-4 Form-rather than prompt for a dollar amount, allow the taxpayer to enter either a dollar amount or a percentage.

The change on the form and or instructions is not a legislative change, and therefore, possible. There might be a software issue involved from the IRS perspective.

Maziarz also mentioned that Area 6 is also looking at this same form.

Issue # 467- EFTPS- (Electronic Federal Tax Payment System)-this issue has already been elevated to the Joint Committee and Area 2 will be getting credit for it. But, since this issue is two-fold, it is still addressing “What is meant by a calendar year?”- (Action item: Dick Bobb will be addressing this second portion of this “active” issue.)

Issue #70- Improvements to the 1040 Toll Free Number- Balmer shared that Area 2's recent recommendation to the Joint Committee was returned since there were other area committees that also had telephone issues and the Joint Committee requests that all of these be incorporated into one.

The issue of not receiving accurate information from assistors and not being able to get the same person/representative when you call again needs to be researched and included in the recommendation for improvements to the IRS telephone system.

Balmer spoke of a “Call Tracking System” as a concept to address the accuracy issue. For example, an employee receives a call and types all data into the system and when the account is pulled up again, you can see what was discussed before.

DFO Romito discussed the new IRS system called ICP (Intergrated Case Processing) system, but this is available only for those who have a tax problem. Not every taxpayer's account is available for view by a telephone assistor.

The committee realizes that the telephone issue is a big problem. If Area 2 can just take a small portion of the big problem that would be ideal.

Action item: Perros to send by fax to Analyst De Jesus, a sanitized copy of a Notice CP-503, he recently came across, which is a perfect example of why there is a need for clarification of IRS Notices. (Issue #2371) Analyst is to forward this example to the Notice Issue Committee as suggested by Panel Member C. Morgan Edwards.

**Committee also discussed that perhaps if there could be an alert on IRS publications informing the taxpayers to “please get employee's name and identification number” prior to any interaction over the telephone. Also, an addition to IRS Publications may be a listing of IRS telephone numbers made available to the public. (Action item for Balmer)

Panel member Perros asked: “Can we get a representative from a company such as AT&T or Verizon to participate during a future Area 2 teleconference meeting and perhaps someone from the IRS?” DFO Romito stated that this would require research.

Action item: Dr. Perros will look into this matter and requested that this issue be added to the next meeting's agenda. (Analyst De Jesus)

Review of New Issues
Issue # 2341, received from a taxpayer from the State of Maryland: “If IRS had more leniency on penalties and interest, taxpayers will be more compliant”.

Committee discussed that penalties are statutory; the IRS does have some discretion on the application of the “reasonable cause” provision.

Panel member DiMartino stated that he has been able to obtain for his clients abatement/waiver of penalties on several IRS imposed assessments, due to the fact that there was reasonable cause, i.e., illness, death in the family, etc. The IRS accepted these as reasonable explanations. The result was that the IRS abated/waived the penalties. However, there is no statutory reason for IRS to remove interest.

The committee agreed that a response be sent back to the taxpayer from Maryland explaining the procedures/guidelines regarding reasonable cause and that this issue be closed. (Action item for Analyst De Jesus)

“New issue initiated by Panel Member Perros”- #2389- Panel member Perros discussed that he is considering reviewing and editing Publication 519, “U.S. Tax Guide for Aliens” – from 4-5 pages of this publication. Dr. Perros strongly feels that the IRS needs to improve on simplifying their communications to taxpayers. (This issue will be placed in Parking Lot Status)

The examples sometimes used in IRS instructions are just as complex. Committee discussed “beta testing” method that is used by many companies before they are ready to go out to customers with a product or service, and it is shared with a focus group beforehand.

Also, there was discussion on how many a times when Congress approves a tax law change, there is no time for quality review of the release, for example, President Bush's recent tax law credits.

The committee showed an interest in finding out what steps are taken or what process is in place for when publications or instructions are created.

This issue may result in a possible recommendation to the IRS requesting that an outsource team to review or edit IRS communications to taxpayer be obtained to review correspondence prepared for the taxpayer early on in the process. The committee agreed that there is a need for clarity in IRS instructions and communications in general.

DFO Romito discussed the IRS's initiative in using “How to Write Plain English”. The readability feature on Word documents that indicate at what level one is writing is the Flesch Reading Ease Scale. The rating Flesch gives to the Internal Revenue Code is a minus 6.

Action item for Analyst De Jesus: Inez is to find out if there are any statistics on how many aliens use Publication 519.

New Issue # 2370- “Practitioner from Pennsylvania complains that IRS Taxpayer Assistance Center (TAC) office in Monroeville , PA , staff will not stamp copies of filed returns or documents. Practitioner suggests that these offices should have a rule of at least 12 tax returns or extensions per Practitioner be stamped”.

DFO Romito shared with the committee and submitted for the record the “Field Assistance Operating Guidelines – Fiscal Year 2003”, item #14, “Receipt of Tax Returns” which states the following:

• Taxpayers requesting proof of filing will be given a date stamped photocopy of the first page of the tax return.
• Original timely filed returns will not be date stamped.
• Practitioners requesting verification of returns brought into the office for proof of filing will be required to provide a transmittal list or copies of the first page of the tax return for date stamping.
• Bulk delivery of timely filed returns from practitioners will be mailed to the appropriate Submission Processing Center and will not be date stamped.

DFO Romito stated that the remaining sentences are internal processing guidelines.

The committee agreed that the procedures seem appropriate and that the offices should be following the guidelines. Recommendation was made to close this issue.

TAP Speak- “Is it working?”
Vice-Chair Balmer asked how did panel members feel about using TAP Speak as the primary means to obtain information from the TAP staff and many members expressed that the design of TAP Speak could use some improvement. Consensus was that TAP Speak is not user friendly for all members.

Panel members McCombie and Steinberg discussed the “Java Virtual Machine” a free download software that may be beneficial to those who are experiencing problems. (Action item: McCombie/Steinberg to share with others how this may be obtained).

Committee suggested that bulky mail be sent to them in the weekly mail and to please indicate priority or importance of items being sent to them. Another suggestion is to point to the link by email of where information may be obtained.

Panel member Steinberg wanted to discuss the issue of members who had missed a lot of meetings, and Vice-Chair Balmer stated that this would be discussed off-line.

Schedule Future Meetings- 2003/2004
Date(s), Times, Telephone vs. Face-to-Face

• November 4, 2003, 3:00-4:30 PM EST, Teleconference
• December 2, 2003, 3:00-4:30 PM EST, Teleconference
• January 6, 2004, 3:00-4:30 PM EST, Teleconference
• February 3, 2004, 3:00-4:30 PM EST, Teleconference
• March 5 & 6, 2004, To be determined, Face-to-Face (Charleston, SC)
• April 6, 2004, 3:00-4:30 PM EST, Teleconference
• May 4, 2004, 3:00-4:30 PM EST, Teleconference
• June 11 & 12, 2004, To be determined, Face-to-Face (Baltimore, MD or Norfolk, VA)
• July 6, 2004, 3:00-4:30 PM EST, Teleconference
• August 3, 2004, 3:00-4:30 PM EST, Teleconference
• September 7, 2004, 3:00-4:30 PM EST, Teleconference

Committee agreed that the same dial-in number and participants' code will be used on teleconference calls as indicated on monthly agendas. 

Administrative News
None 

Public Input
None 

Closing Assessment
The committee expressed their gratitude to Mary Balmer for her leadership skills and hard work during the past year. The meeting was adjourned timely.