This should be enough to get you started thinking about how to use the Inflation Reduction Act to help your clients – and yourselves.
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Eva Rosenberg, MBA, EA, known as the Internet’s TaxMama®, publishes the popular TaxMama.com website, cited by Consumer Reports magazine as a top tax advice site, and a LIFE Magazine Editor’s Pick.
This is designed to cover the cost of hiring an additional 87,000 IRS employees and improving services and infrastructure – over the next ten years, not all at once. Bear in mind that 52,000 of the most experienced employees will be eligible to retire in the next 6 years. They will also need to be replaced – with new, less experienced staff.
In fact, we are losing the current Commissioner of the IRS, Chuck Rettig. His term expires on November 12, 2022. Doug O’Donnel has been appointed as the interim Commissioner. Although he has over 35 years of experience working for the IRS – running the entire organization will require quite a learning curve – until he is replaced by a permanent appointee.
As to other new hires, even if the IRS were to hire 5,000 employees today – it takes 3 - 6 months or so before the mandatory federal background checks allow them to start work – and then the additional time to get trained. So don’t expect a huge influx of staff quite yet.
Perhaps for both purposes!
First of all, are you tired of sitting on hold for hours with the Practitioner Priority Service (Hotline) and other IRS phone lines – only to get the call disconnected before it’s even picked up? Do you resent paying for the phone bot services to get your call at the head of the line?
Are you tired of the IRS posting delays for payments – and the related balance-due notices for payments people have already made?
Are you sick and tired of getting calls from your clients who are still waiting for their refunds – some from the 2020 tax return?
Well, believe it or not, so is the IRS.
In fact, nearly $5 billion dollars is going towards modernizing information technology (IT) systems. One goal is to establish an authentication system on all IRS collection phone lines to screen out the bots in 2023. (You may be aware of the pilot program now in effect on the Hotline.)
In addition, the IRS is opening two new call centers in 2023 – in Puerto Rico and the Mississippi Delta – currently under-served areas.
The IRS is expanding their Rapid Response Appeals Process (RRAP) pilot program to speed up settling collections cases. Collections intend to provide more automation and to work with Appeals to establish significantly shorter case processing times.
On the other hand, with the employees already on staff, IRS is using the funds to put more Revenue Officers (collections) and Revenue Agents hitting the field right now. Expect to see them target taxpayers who are delinquent in filing and paying, with an emphasis on the high-income non-filers. So tax collection revenue should be rising.
Here are some of the highlights that are apt to affect your clients:
This should be enough to get you started thinking about how to use the Inflation Reduction Act to help your clients – and yourselves. However, with everything going on this year, I urge you to attend tax update classes as soon as you can.
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