Area 4 Committee Meeting Minutes
Face-to-Face, Cincinnati, OH
May 13-14, 2008

Tuesday, May 13, 2008
Wednesday, May 14, 2008

Area 4 Chair Report
Taxpayer Advocacy Panel Town Hall Meeting

Designated Federal Official

• Martin, Betty - Nashville, TN - LTA

Committee Members Present

• Blanchard, Greg - Cordova, TN - Member
• Bryant, Patricia - Millington, TN - Member
• Buschmann, Ray - Lake Forest, IL - Member
• Hurr, Joe - Dayton, OH - Member
• Kennedy, Jeff - Louisville, KY - Vice Chair
• Khan, Anne - Chicago, IL - Member
• Martyniuk, Lev - Cincinnati, OH - Member
• Melchior, Jerome - Vincennes, IN - Member
• Meister, David - Franklin, WI - Member
• Monnier, David - Indianapolis, IN - Member
• Mull, Bob - Ann Arbor, MI - Member
• Spiotto, Ann - Lincolnwood, IL - Member
• Taylor, Rita - Cincinnati, OH - Member
• Verwiel, John - Cottage Grove, WI - Member
• Wernz, Stanley - Cincinnati, OH - Chair

Committee Members Absent

• Adams-Dodds, Carolyn - Detroit, MI - Member
• White, Regina - Southfield, MI - Member
• Wingard, Kelly - Decatur, IL - Member

TAP Staff

• Coston, Bernie - Atlanta, GA - TAP Director
• Delzer, Mary Ann - Milwaukee, WI - Program Analyst
• Patti Robb - Milwaukee, WI - Program Analyst                             

Guests

• Bonnie Esrig - Cincinnati, OH - Local Taxpayer Advocate
• Jo Diehl - Cincinnati, OH - Campus Taxpayer Advocate
• Barbara Alexander - Cincinnati, OH - Caseworker, Local TAS Office     

Tuesday, May 13, 2008

Welcome / Roll Call / Review Agenda
Stan Wernz welcomed everyone to Cincinnati.
Anne Khan requested that the new issues group meet informally before the issues are presented to the whole group.  It would save some time.

Joint Committee Report
See attached Chair/Joint Committee report.  (Attachment One) 
Coston encouraged the committee members to join the one hour Joint Committee (JC) calls which are held the first Wednesday of each month, 2 – 3 p.m. ET.

Wernz asked that the subcommittees notify him each time they meet.  He also emphasized the importance of reporting outreach. 
Target dates – each committee was told to add target dates for completion for each issue being worked. 

Wernz handed out copies of the newly improved self mailers members can use when doing outreach. 

Director’s Report
We are at the point that almost all committees have had their face-to-face meeting.  At this point, our budget is very tight.  
We are still trying to secure a location for our annual meeting.  We are finding it difficult to find a hotel in Washington, DC.  We are looking at the first week in December.  We tried to move it to mid-November, but that will not work.  We may end up moving the meeting to a different location.  The downside there is it is more difficult for the executives to attend.  We are looking at Baltimore since that is close in proximity. 
Staffing – we have a couple applicants for the manager position in Milwaukee and hope to have them on board within 30 days.  We also opened up a new position in each office; Junior Analyst, and each office now has someone in that position. 
Brooklyn – Meredith Odom
Milwaukee – Patti Robb
Plantation – Donna Powers
Seattle – Nina Pang
Recruitment – Coston thanked the panel members profusely.  We far exceeded the number of applications received last year.  This year we had 621 final applications.  The application packages are being ranked this week.  The goal is to have the final list of selections to the NTA by the end of July.  We are hoping for final approval from Treasury by the first of October.  If anyone wants to help with interviews, please let Delzer know.  They will be done during the month of June.  The interviews last about one half hour and we will try to schedule them so you are not interviewing for a whole day or for days in a row. 

Annual Report – we are in the final review stage of the report.  We hope to get it to the publisher very soon.  Once it is printed, we plan to have a meeting with the IRS Commissioner to present him with a copy.  This annual report has a new format and you should be very proud of it.
John Verwiel complimented the IRS with their handling of the Stimulus Package.  It went pretty smoothly.  Coston added that TAS has been very involved in this process too. 

Lisa Gabriel, new Milwaukee secretary will be reporting the week of May 26, 2008. 

Town Hall Report
The minutes from the town hall meeting and the focus group that followed were handed out and can also be found on TAPSpace.  (Attachment Two)  It was a very successful meeting, with approximately 60 taxpayers in attendance. 

Area 4 members Ann Spiotto, Ray Buschmann, and Kelly Wingard were in attendance.  Ken Wright from Area 5 was also able to attend.  The meeting was held at the Trutter Center, at Lincoln Land Community College, Springfield, IL.  National Taxpayer Advocate Nina Olson was the keynote speaker.  The audience was very engaged and had a lot of questions and brought forward some good issues.  There was also a focus group meeting after the main presentation.   

Greg Blanchard said he was very interested in the debt indicator issue.  There are many preparers out there who are reticent to do taxes when someone owes money (offset) and the preparer is expecting to collect his preparation fee out of a refund that may never come due to this offset. 

Taxpayer Advocate Service—Bonnie Esrig and Jo Diehl
Troublesome Tax Issues?
Local Taxpayer Advocates—Esrig
TAS is the taxpayers’ voice at the IRS.  We are independent from the IRS.  TAS was created through RRA98, under IRC 7803 and 7811.  TAS can propose potential legislative changes.  The National Taxpayer Advocate (NTA) is passionate about taxpayers and helping people.  That same commitment attracts most of the employees to TAS.  By law, there must be one Taxpayer Advocate in each state.  Some states have more than one.  All of them have a local number so people can reach us.  There is also a taxpayer advocate in each campus.  There are two parts of TAS, case resolution and systemic advocacy.  Our service is always free.  A taxpayer contacts us, we listen, and work to address their concerns, and follow their case to resolution.  Right now many of the calls received are regarding the stimulus package.  We look at two things to make a TAS case: economic burden (about 23% of our cases) or systemic cases (about 77%) is when the system is not working.  The NTA has the discretion to determine if public policy needs TAS intervention: i.e. the taxpayer submits documentation during a correspondence audit, but are subsequently told it has not been received.  They submit the information again, but the issue cannot be resolved. 

There are a variety of ways for taxpayers to reach TAS: a Form 911, ATAO, local number, toll free number.
Top issues in this area:

• Applications requesting exempt status
• Audit Reconsideration, especially related to substitute for return
• Amended returns
• Expedited refund requests.

There is also an intake phone line.  One person is dedicated to answer that number.  That frees up the case advocates to work their cases.  A great deal of calls received do not fit TAS criteria.  Each TAS office has a Congressional Liaison meeting.  We meet with our local representatives to exchange information.  We have gotten 93 congressional inquiries to dates.  We go on congressional hill to share the NTA Annual Report to Congress (ARC).  We are in communication and cooperation with the other IRS operating divisions. 

Campus Taxpayer Advocates--Diehl
One difference between Campus Taxpayer Advocates is that we do not work Congressional cases.  Basically our cases are similar; taxpayers who need their refund expedited, stolen identity issues, reconciliations of W-2’s  that do not match the tax return filed; exam reconsiderations.  We are not a mini IRS within the tax system.  About 90% of the calls we receive do not fit TAS criteria.  TAS has some of the best employees in the IRS.  These folks are extremely dedicated.  Every case is important to us and we will see them to resolution.   When working problems, we frequently realize there is a systemic issue and we refer to Systemic Advocacy and add the problem to their database.  TAS was created through IRC 7803 and 7811.  It requires the NTA to provide an ARC.  The report does not go through the Commissioner or Secretary of Treasury, but rather directly to Congress.  A big issue this year had to do with the tax consequences from a cancellation of debt.  TAS is working on some brochures to help clarify this issue.  This is one of the most serious problems identified in the ARC. 

We have a relationship with the Low Income Tax Clinics (LITC).  There is at least one LITC in every state including Puerto Rico and Guam.  TAS makes visits to them and we check that they are using their grant funds as intended. 

We work with TAP and try to help recruit members.  We will also be involved in the interviews too.  We do a lot of outreach events – about 40 a year.  We want to ensure people know we are out here.  We are constantly working on reaching out to taxpayers to let them know about TAS. 

Betty Martin added that whenever she does an outreach, she always mentions TAP.  TAS and TAP are in a partnership.  If your LTA has not contacted you, please feel free to contact them.  They should all be involved with you to offer support and let you know about outreaches. 
Delzer suggested each panel member ask their LTA for a small stack of their business cards so when they encounter someone with an individual issue, they can hand out the card.  TAS works for everybody, be it an individual or a large corporation. 

Public Input
Ferd Schneider – his focus for the last three months has been the AARP/TCE program.  He was an Electronic Return Originator (ERO) this year. 

• The Electronic Stimulus Payment (ESP) is a wonderful thing but there are some unseen issues, that, upon reflection, might have been precluded with more planning.  AARP serves elderly folks and many of them normally do not have to file.  We did returns and tried to e-file them but it would not take because there was not an amount listed as Adjusted Gross Income (AGI).  We were told to throw in a dollar of interest income so it would transmit.  Some people put the dollar as wage income and that resulted in a $2 EITC refund.  Also taxpayers that split their original refunds, and put dollars into their IRA account, are having their stimulus payment deposited there.  Perhaps we need a deeper understanding of the system before sending out these payments.
• This is a Tax Wise issue:  Someone did a return for a taxpayer who gives several  thousand dollars to a charity and then gets a distribution from charitable trusts.  He received a 1099 R for a capital gain distribution.  We have been taught when using TaxWise, you input what you see.  He found out that you cannot delete a Schedule D even if it is blank.  Ferd wrote this issue up and sent it to Delzer as well as the VITA issue committee.  He has not heard whether the VITA issue committee is going to work this issue or not.  Pat Bryant said she will take these issues to Cindy Jones when the VITA Committee meets in Atlanta next month. 

Email from Ron Yersky

Stan:
Thanks for the information on the meeting.  Unfortunately, I have a previous commitment that I am unable to reschedule and will be unable to attend.  I do have a thought that might be addressed if you deem that it is within the scope of TAP's purview.  Can the IRS be encouraged to have VITA/TCE Training publications available for distribution earlier than in the past.  Many times we have nearly insufficient time to ensure training materials get into the hands of new and returning instructors prior to required training for the season.   The same applies to materials for new and returning counselors who need to be trained and certified through the TCE program prior to the commencement of the tax season on or about the 1st of February.  As you know without proper certification no counselor can prepare returns in the TCE program.  Thanks for considering this.  I realize that contracts must be let and drafts approved but it would help if it can be done.
Ron Yersky

Bryant said VITA committee is meeting in Atlanta next month.  The VITA people can be certified on Link and Learn, AARP chose to not use it for certification.  Link & Learn is loaded and available in November. 

Outreach Discussion
Review of the Outreach Mission
Outreach is one of TAP’s prime responsibilities.  If we don’t tell people about TAP, we won’t have any issues.  Outreach can be done to groups of people or just through a one-on-one.        

Making Reporting Easier
Area 4 did really well right after the annual meeting but the activity has dropped off since then.  We need to set some goals.  Wernz would like everyone to have at least two outreaches each month.  Discussion followed about what constitutes an outreach.  Does it have to be a large defined group or can it be a one-on-one?  If you can complete reports as soon as you are done, it simplifies the reporting.  These reports are rolled into the TAP annual report at the end of the year.  It was determined that an outreach would be two meaningful events, not necessarily organized by the member.  Consensus.                      

Pipeline Processing DVD

The TAP Experience
Reflections of third year members-Jerry Melchior
Thinks the TAP experience has been great.  Experience with the TAC survey and the accompanying report was a very satisfying experience.  Three years is a perfect term. 

New member experience to date-Rita Taylor
Rita Taylor said the bottom line is the results are wonderful.  However, the whole process, beginning to end, was painful.  There is no reason why the annual meeting has to be held in Washington, DC, as opposed to Atlanta or Kansas City.

Greg Blanchard thinks they should be given more information when one is interviewed.  It is a lot to expect someone to pay for their own hotel up front when they travel. 

Lev Martyniuk thought the whole experience was great.  He said you will run into problems no matter what you do.  Life happens.

Ann Spiotto thought the business meeting was very professional and was appreciative. 

Wernz said someone made a suggestion that all the new members get together the first night in Washington, DC, to get to know each other.  Delzer commented that Ken Wright took all the new Area 5 members out for dinner their first night and they liked the chance to get to know the others. 

Dave Meister said he has seen tremendous strides through TAP during his three year term.  What the Notices Committee has accomplished is great and the feedback from the IRS has been excellent too.
    
TAP Style Guide and Quality Review Process
Wernz said he erred in thinking the issue referral checklist did not need to go forward with a recommendation.  It does.  The quality review team wants to see the checklist.   The QR process:  New issues ready to be elevated are to be sent to Janice Spinks and the quality review team. The QR team reviews it at their next call.  However if we miss their QR meeting, it may be held for another month.  If they suggest a change, if it is minor or grammatical, Delzer will fix it and send it back and won’t bother the whole committee to review it.  Delzer is the analyst who will be sending all approved elevated issues to the IRS. 

Issues Discussion

• Issue 4660 – IRS use of Public Service Announcements - Verwiel

Report next month.

• Issue 4649 – Unclaimed Telephone Excise Tax Refunds - Verwiel

A number of people failed to claim this refund last year.  Delzer has provided him with research.  He will review all the information to try to put together a recommendation to make sure people who are eligible take advantage. 

Wernz suggested if you need information or research for an issue, please contact Delzer to do it for you.  You need to provide her with specific guidelines.  Make this request via email so there is a paper trail. 
Pat Bryant asked how can you determine how many people are actually eligible for this credit? 

• Issue 4521 – Estate Tax Return Complexity - Mull

Someone made the comment to him that they had to do an estate return only to find out there was no tax due.  He thinks there should be an EZ form to fill out. 

Wernz downloaded the form and the instructions.  He did several returns only to find out no taxes were due, however he thought the instructions were pretty clear. 
Consensus to Drop.

• Issue 4340 – Capital Gains Processing Errors - Kennedy

This issue has to do with a notice being sent our erroneously.  Delzer needs to do research to see if this was a practitioner error or if it is a systemic error.  We do not know the extent of the problem. 
ACTION:  Delzer will research Capital Gains Processing Errors.

• New Issues

Mull--put together a handout about social security taxability for married filing joint taxpayers that the Burden Reduction Committee has been working on.  It is a very complicated process.  The instructions in Pub 17 have an error and the IRS was aware of it.  It has already been corrected for the 2008 filing season.  They are hoping the IRS will accept their suggested changes to help simplify this issue. 

Bryant – identity theft.  This is getting to be a big issue.  Someone stole her son’s SSN and filed a return and got a RAL.  When her son filed, he had to prove his SSN was valid.  The burden falls on the person who legitimately filed with their own SSN.  IRS should appoint a contact person who handles this type of identity theft .  With repeat offenses the legitimate person has to prove it every year.  This happens a lot and is a growing problem. 

Even though the SSN on the W-2 do not match the name of the filer, these taxpayers can file electronically with an ITIN.  The IRS should capture the information of the legitimate filer and keep it rather than make them provide proof each year.  Bryant suggested that when someone suffers this identity theft, they be issued a special personal identification number (PIN) to help alleviate their burden.  Martin said starting last year if you filed and a dependent SSN did not match the birth date, it would be kicked out by the IRS.  These cases are seldom pursued and prosecuted.

Wernz asked if this is the same as # 4210 – would all this discussion fall under this issue?  Bryant thinks this should be separated into two issues. 
The screening committee will determine if they want to consider working this issue. 

Wednesday, May 14, 2008

Working the Issues Continued
We are going to be looking at the issues and breaking up into subcommittees.
Rating system:  High – Medium –Low
 
4663 – Part not in scope, Part has already been solved - drop
4682 - Drop
4693 - Drop
4694 – Drop – IRS addressed this already
4702 – Drop
4707 – Medium priority
4741 – Drop – individual issue
4742 – Drop – not in TAP scope
4743 – Partly done – other part not in TAP scope
4744 – Drop - legislative
4745 – Put in parking lot – forward to Area 5
4749 – Drop – not in Scope
4754 – Drop - legislative
4755 – Send to Burden Reduction – parking lot
4756 – Drop - legislative
4758 – Drop - legislative
4759 – drop  - statute that IRS cannot contact anyone via email - legislative
4760 – combine with 4761
4761 – combine with 4760 – Medium priority
4762 – drop - legislative
4763 – drop – SSA issue
4764 – drop – already being worked
4765 – Low priority
4766 – drop – not in TAP scope
4767 – drop
4768 – drop - already exists
4769 – drop
4770 – Low priority
4771 – High priority
4772 – drop
4773 – drop
4774 – drop
4775 – drop
4776 – parking lot – wait for response from prior recommendation
4777 – Forward to Area 5 – parking lot
4778 – drop
4779 - forward to Ad Hoc
4780 – drop
4781 - drop
4782 – Medium priority
4783 – drop – not in TAP scope
4210 – High priority

Discussion: 
# 4707 – Form 1041 Schedule G instructions - Medium priority – we could do minimal research and then it should go to Forms and Publications

• subcommittee members:  Jeff Kennedy (will do initial research), Ann Spiotto, Jerry Melchior

# 4760 / 4761 – Installment Agreements / Liens & Levies –

• subcommittee members:  Stan Wernz (will do initial research), Dave Monnier, Dave Meister (lead)

# 4765 – Third Party Return Preparations –PTINs

• subcommittee members:  Pat Bryant, (will do initial research)

# 4770 – Notices and checks mailed separately

• subcommittee members:  Rita Taylor (will do initial research), Betty Martin will assist

# 4771 – Forms, Instructions, and Publications –Forms 944/941

• subcommittee members:  Bob Mull, lead, Lev Martyniuk, Pat Bryant
• How does payment get credited, Bob will look at instructions
• Conference call June 9, 2 pm

# 4782 – Offers-in-Compromise – Decided to put in parking lot.

• subcommittee members: 

# 4210 – Allow suspension of return processing – Identity theft

• subcommittee members:  Greg Blanchard, lead, Pat Bryant, Joe Hurr, Dave Monnier
• Conference call every other Thursday at 2pm CT, first one May 22

Meeting Wrap-Up
Jeff Kennedy – the last meeting we did not have quorum.  Will send out an evaluation sheet to everyone after the meeting ends today.  Please make comments as you deem necessary.

Please check the minutes to ensure you are assigned to the correct issue subcommittee. 

Wernz thanked everyone for taking responsibility when asked.  There will be no Area 4 conference call next week. 

Meeting adjourned