Area 7 Committee Meeting Minutes

Taxpayer Advocacy Panel
Area 7 Face-to-Face Committee Meeting
Los Angeles, CA
April 6, 7 and 8, 2006

Designated Federal Official (DFO)

• John Tam, Local Taxpayer Advocate

Attendance

• Larry Combs
• Margaret Ferguson
• Greg Gursey
• Dave Jones
• Allena Kaplan, Chair
• Tom Karwin, Vice Chair
• Mavis Smith
• Iris Sosa
• Wayne Tanna
• Wayne Whitehead
• Doug Wilhelm
• Gil Yanuck

Staff

• Judi Nicholas, TAP Program Manager
• Dave Coffman, Program Analyst
• Marla Ofilas, Note Taker

Opening and Welcome
As DFO, John Tam opened the first face-to-face Area 7 meeting for 2006. Allena welcomed the members and reviewed the agenda. Roll call was taken and a quorum was met.

Outreach Discussion
Allena explained that the committee is off to a running start. Members provided insight on their outreach activities. Gil had the opportunity to speak about TAP on the radio and television. Larry will soon be giving a speech regarding TAP.

Judi stated that TAP has received many applications in response to the recruitment drive. People interested in becoming TAP members have until the end of April to submit their applications. Ranking of applications will be completed the end of May and interviews will take place in June. Allena felt it was important to continue outreach to get the word out about recruitment and TAP.

Outreach Workshop
Gil gave a presentation about outreach and shared some of his outreach experiences. When informing the public about TAP, they’re often surprised that TAP exists. Gil felt that members should focus on different groups to ensure all parts of the public know about TAP. He noted that, many times, he has to explain the difference between TAP and the Taxpayer Advocate Service (TAS). By using the outreach toolkit, members can both prepare for their events and communicate an effective message about TAP.

Gil cautioned members to be prepared when doing television interviews. Often, interviewers will ask about a subject that is not related to TAP. Gil explained that members should stick to their message even though they may be steered in another direction. Judi added that the staff is available to assist and prepare members for interviews.

Gil also suggested that members could get the audience interested in TAP by discussing hot topics or using the success stories in the outreach toolkit. Margaret asked how a member might explain that TAP does not work legislative issues. Judi suggested that members can inform their audience that such issues are not within TAPs scope; however, TAP can receive legislative issues and elevate them through the National Taxpayer Advocate.

Joint Committee Report Out
Allena reviewed highlights from the March Joint Committee teleconference. Larry Combs, TAP Chair, will meet with Commissioner Everson on April 20. The Commissioner has made a commitment to meet with TAP members twice a year. After the meeting, Larry will provide all members a summary of their discussion.

Allena re-announced that TAP has started the recruitment process and the deadline for submitting applications is April 28. Members suggested last year’s applicants should be contacted and asked to reapply.

Gwen Handelman, former TAP Chair, has completed the TAP annual report. Judi asked members to email Dave C. with a list of suggested recipients.

Action: Members will email Dave with suggestions of names and organizations that should receive an annual report.

Area 6 is preparing to host a Town Hall meeting with Nina Olson, National Taxpayer Advocate (NTA). The meeting will take place in Fargo, ND on April 25, 2006.

The TAP Annual Meeting will be held in Washington D.C. during the week of December 11-15, 2006 at the Hyatt Capitol Hotel. No other details were provided.

The Joint Committee has decided to have their face-to-face meetings in Denver and Dallas. However, dates for the meetings were not selected.

Dave – Pipeline Processing Presentation
Dave gave a presentation on how an issue is processed within TAP. Dave reiterated that TAP does not work legislative issues; however, members may elevate them to the NTA.

Dave provided an overview of the process by which an issue is worked within an issue committee. Issue committees receive their issues directly from the IRS. Each issue committee has a program owner, which provides the members with a specific task or issue to work. An issue committee’s final recommendation is made directly to the IRS. It does not need to be reviewed by the Joint Committee. For an area committee, each issue must be reviewed by the Joint Committee before it’s sent to the IRS.

Dave provided the members with a copy of the Joint Committee Issue Referral Form Check List. Dave reviewed the form and explained that the list was created to assist committee chairs on submitting a referral to the Joint Committee.

Gil Yanuck - Issue Number 3444
A suggestion was made that the toll-free automated refund line should provide the option to speak directly to an actual IRS employee, if the caller has questions. However, after further research and discussion with John Tam, Gil concluded that the toll-free automated refund line was designed to give taxpayers to a quick and easy method to check on their refund. Taxpayers needing further assistance can call the general IRS assistance line.

Gil recommended that the issue be dropped.

Decision: Consensus was made to drop the issue. Dave will draft a response letter to the taxpayer advising them of TAP’s decision.

End of Day Announcements
The committee concluded their first day by reviewing the agenda for April 7, 2006.

As DFO, John Tam closed the meeting.

April 7, 2006

Designated Federal Official (DFO)

• John Tam, Local Taxpayer Advocate

Attendance

• Larry Combs
• Margaret Ferguson
• Greg Gursey
• Dave Jones
• Allena Kaplan, Chair
• Tom Karwin, Vice Chair
• Mavis Smith
• Iris Sosa
• Wayne Tanna
• Wayne Whitehead
• Doug Wilhelm
• Gil Yanuck

Staff

• Judi Nicholas, TAP Program Manager
• Dave Coffman, Program Analyst
• Marla Ofilas, Note Taker

Opening and Welcome
John Tam opened the meeting.

Subcommittee Break Out
The members broke out into their assigned subcommittees to discuss their assigned issues. This took place during the first five and one-half hours.

Review Remaining Issues
The entire committee met to review the list of remaining issues.

3073 – TAP Speaker/Outreach Kit
Area 7 Panel members would like to be more prepared during outreach opportunities.
Decision: The committee agreed to drop this issue. An outreach toolkit is now available to all members.

3267 – TAP Member Outreach Coordination
There is no method in place to coordinate outreach efforts by TAP members located in the same geographic area.
Decision: The committee agreed to drop issue. It was agreed that TAP members in the same area should coordinate their outreach plans so efforts are not duplicated.

3363 – TAC Mail Procedures
Action: Tom and Judi will meet to discuss this issue further.

3482 – Alternative Minimum Tax (AMT) Due to Stock Options
The AMT taxes the value of incentive stock options at exercise rather than the value of the stocks at the time of sale.
Decision: The committee agreed to drop issue. The issue legislative and is not within the scope of TAP.

3483 – ETLA Website
According to Government Accountability Office, the IRS plans to eliminate the Electronic Tax Law Assistance system. Further, usage of the system has declined due to Internet placement of the site on www.irs.gov in an effort to decrease the demand on IRS resources.
Decision: The committee has decided to leave the issue in active status. Additional research is needed and Tom Karwin will continue to champion the issue.
Action:

• Committee would like a more interactive site.
• Dave C. will research to find out what the IRS future plan is for the site.

3492 – TAC Closing
The IRS has chosen to close 68 Taxpayer Assistance Centers, citing budget constraints.
Decision: The committee agreed to drop the issue. The IRS has decided to continue its research before making a decision to close the centers.

3503 – Form 940 Telefile
Discontinuing the Form 940 TeleFile program is creating an undue hardship for certain taxpayers.
Decision: The committee has agreed to drop the issue. The committee felt that they should not work an issue in which funding has been discontinued

3512 – Form 941 Telefile
IRS is discontinuing TeleFile for the annualized Form 941.
Decision: The committee has agreed to drop the issue. The committee felt that they should not work an issue in which funding has been discontinued.

3577 – Depreciation Schedules Processing
The IRS no longer requires a depreciation schedule with the individual tax return (when the taxpayer claims depreciation expense).
Decision: Issue Dropped

3582 – 941 Telefile
Repeat issue as 3512.
Decision: Issue Dropped

3633 – TAC Services Transcripts
The refusal of TACs to provide a transcript of returns is creating inconvenience and frustration for taxpayers.
Decision: All members have agreed to have Margaret champion the issue.

3774 – Communication – IRS adopting an online Chat
The IRS has not adopted “online chat” as a method of communication with the public.
Decision: Issue dropped

3776 –Service/Compliance – Balance
The IRS does not utilize an appropriate balance between services offered and compliance.
Decision: Issue dropped. The committee felt that it does not have the ability to provide comment on IRS budget.

3777 – TAC Offices – Location
Taxpayer Assistance Centers (TAC) are not always located in the most accessible areas where those in most need of their service reside. The criteria for determining the location of a TAC does not always result in the best location for taxpayers.
Decision: Issue dropped. The committee felt that it does not have the ability to comment on policy and budget issues within the IRS.

3778 – Toll-Free Number – Customer Service
The IRS, especially the IRS toll-free line, does not have a customer service focus.
Decision: Issue dropped

Subcommittee Report Out
Each subcommittee had the opportunity to provide a report out on the issues that were discussed and worked.

Subcommittee B

#3687 (Toll-Free and TAC Help for the Self-Employed)
The subcommittee considered the caller’s fears and frustrations encountered when trying to get into compliance. The subcommittee suggests that IRS institute a program which reduces or eliminates the fears of non-compliant taxpayers, bringing them into compliance without fear or intimidation. An ideal solution is believed to be a button or link on the www.irs.gov home page that says something like “If you haven’t filed your taxes for several years, click here”. The link would take the user to an area with answers to basic questions tax filing questions and information about taxpayer’s rights. Focus of the recommendation would be on closing the tax gap with minimal cost.
Decision: The committee agreed to pursue as high priority and keep this as an active issue.

# 3692 (Appeals – Contacting Appeals Officers)
Decision: The committee has agreed to drop the issue and provide a letter to the taxpayer with a contact number that assists taxpayers in locating their Appeals Officer.

#3772 (E-file – Receiving Timely Software for E-file Program).
Decision: The committee has agreed that this issue be dropped. Updates due to tax law changes are beyond the control of IRS and/or the preparers of the tax software. Software updates are necessary in case a mistake is found. The committee feels that there’s no way around this.

Subcommittee C

#3731 - Form 1099 – Fill-able PDF Format
Form 1099 is not available in a fill-able PDF format. The subcommittee decided on additional research:

• How many parts are to a 1099 and where do they go?
• If handwritten 1099s are acceptable, why would PDF fill-able forms not be acceptable?
• How difficult is it to assure the multi-part form in PDF on IRS.gov. prints out?

Decision: The committee agreed with the recommendations for additional research.

#3773 - Education – Tax Law Education in Schools
The IRS should provide tax law education in schools
Decision: The committee would like the following information:

• The sub-committee would like the current status of IRS efforts to educate youth about taxes.
• Has IRS developed other initiatives since 2003?

#3775 - Toll-free Number – Making Other Toll-Free Numbers Available
The IRS does not make the public aware of toll-free taxpayer assistance numbers, other than 1-800-829-1040
Decision: The committee agreed that additional research is needed. The subcommittee had the following ideas about where the number might appear:

• www.irs.gov web site
• Form 1040 family of instructions
• Publication 17 – back page

#3379 - Estimated Tax Instructions
The IRS instructions for Estimated Tax Payments fail to inform the taxpayer to round the payment to the nearest dollar amount.
Decision: The sub-committee is interested in the following information prior to making a decision:

• The policy for issuing for CP13 and a copy of the letter.
• What does the Form 1040ES instructions say about rounding?
• What is the IRS check cashing policy?

Subcommittee A

#3579 – 990 EZ
Part 5, Line 35 of Form 990 EZ, as it relates to business activities, is incorrectly worded. It implies an intent which contradicts other parts of Form 990 EZ.
Decision: The committee agreed to submit the correction for the taxpayer via the number provided in Publication 17.
Action: Dave C. will send a letter to the taxpayer informing him/her of the action taken.

#3669 – Notices – Timeframes
The IRS does not always allow sufficient mailing time when providing taxpayers timeframes for responding to notices.
Decision: The committee agreed with the subcommittee that the issue should be closed. This issue is legislative in nature and is not within the scope of TAP.
Action: Dave C. will send a letter to taxpayer to contact his/her congressional leader.

#3745 – IRS Toll-Free Line – Info about VITA, TCE and irs.gov
The IRS toll-free number (800-829-1040) does not provide a list of VITA or TCE sites. It also does not provide information about accessing the IRS web page (irs.gov)
Decision: The committee has agreed to drop the issue.
Action: Dave C. will send letter to the taxpayer to inform him/her that the number was intended to provide VITA/TCE information close to the caller’s home instead of a comprehensive list. Taxpayer may contact SPEC for a comprehensive list.

#2771 – EFTPS – Educating Practitioners about Website
Many practitioners are not aware that, for those practitioners who electronically file, there is an IRS internet site to look up estimated tax payments.
Decision: The committee has agreed to close this issue.
Action: Dave C. will send a letter to the taxpayer that will explain that the service is available and provide information on where to find it.

End of Day Announcements
The committee concluded their second day by reviewing the agenda for April 8, 2006.

DFO, John Tam closed the meeting.

April 8, 2006

Designated Federal Official

• John Tam, Local Taxpayer Advocate

Attendance

• Larry Combs
• Margaret Ferguson
• Greg Gursey
• Dave Jones
• Allena Kaplan, Chair
• Tom Karwin, Vice Chair
• Mavis Smith
• Iris Sosa
• Wayne Tanna
• Wayne Whitehead
• Doug Wilhelm
• Gil Yanuck

Staff

• Judi Nicholas, TAP Program Manager
• Dave Coffman, Program Analyst
• Marla Ofilas, Note Taker

Opening and Welcome
John opened the meeting.

Incentive Program Proposal
Tom informed the group of his proposal for an incentive program which would recognize taxpayers’ suggestions that have resulted in exceptional IRS improvements. Tom’s proposal is based on the “There Ought to be a Law” program in California.

Decision: The committee decided to explore this issue by forming a subcommittee to develop a business case for the suggestion. The subcommittee will consist of Doug, Tom, Dave J., Gil and Mavis.

Referring Non-TAP Issues
Allena led a brief discussion on referring non-TAP issues to proper areas within IRS. Non-TAP issues are often encountered during outreach events.

Action: Judi will ask Marla to order copies of Publication 4255 for the members.

New Issue
Dave C. introduced the newest Area 7 issue to the group. He read the “Brief Description of Problem” for contact #3831.

Action: The Issue Process Subcommittee will include this issue in the review at their next meeting.

Announcements
Allena reminded everyone to follow through with Dave C. on their subcommittee research and action items.

Decision: Subcommittee facilitators will report on the progress of the issues at the next Area 7 meeting.

Action: Dave C. will provide the action items to the subcommittee facilitators by the end of next week.

Next conference call will be on May 17th at 2:00 Pacific Time. A request was made to move the time to earlier in the day.

Action: Dave C. will send an e-mail to all members asking them for their availability on May 17th.

End of Meeting Assessment
Allena asked the group to comment on the meeting.

Larry noted that there was too much sidebar discussion.

Margaret enjoyed the face-to-face discussions. She found them good for cementing relationships.

Judi noted that working in subcommittees was an effective way to tackle some of the issues.

Doug observed that Area 7 loses a tremendous amount of energy and forward movement from one year to the next. Allena suggested that Area 7 set some goals early in the year.

Wayne W. said that more information could be disseminated during the orientation about issues that the TAP can work, instead of focusing on the issues that TAP cannot work.

Tom asked about a potential new issue: The IRS would generate a preliminary tax return for taxpayers who would normally prepare a Form 1040EZ form, the IRS would prepare the form for the TP and send it to them for their approval. Tom added that there’s already some information about a similar program being done with the state.

Action: Dave C. will load this on the database.

Closing
John noted that this has been a very productive meeting. He recognized the passion and energy of the members in completing their tasks. John closed the meeting.