Yardley CPA

IRS Plans to Process Complaints against Tax Preparers Faster.pdf IRS Plans to Process Complaints against Tax Preparers Faster http://www.accountingtoday.com/news/irs-watch/irs-plans-to-process-complaints-against-tax-preparers-faster-71884-1.html The Internal Revenue Service intends to process complaints against tax preparers from their clients in a more timely way, in response to a new government report that found it had begun work on only about half the complaints it received since October 2012. The report, from the Treasury Inspector General for Tax Administration, reviewed 8,354 complaints against tax preparers received by the IRS between Oct. 1, 2012 and Sept. 11, 2013 and identified 3,953 (or 47 percent) for which work on the complaints had yet to be initiated. Of the 3,953 complaints, 1,920 (49 percent) had been in the IRS’s inventory for at least 60 business days with no work initiated. The IRS processed about 77 million individually electronically filed federal income tax returns prepared by paid tax return preparers in 2013, TIGTA pointed out. As part of its oversight responsibilities, the IRS has developed processes and procedures through which taxpayers can file a complaint with the IRS. However, those procedures do not ensure that taxpayer complaints are accurately and consistently processed, TIGTA noted. In addition, processes have not been established to effectively track the complaint referrals to IRS business functions to ensure that the complaints are received for evaluation and track how the referred complaints are ultimately resolved. “Tax return preparers play an increasingly important role in helping taxpayers to comply with the tax laws,” said TIGTA Inspector General J. Russell George in a statement. “Unqualified or unethical tax return preparers can negatively impact taxpayers as well as tax revenue if the tax returns they prepare are incorrect and/or fraudulent.” TIGTA made eight recommendations to the IRS, including that it establish goals and procedures to ensure that complaints are timely processed; develop a process to ensure that complaints are recorded in inventory records; ensure that criteria for referring complaints to business functions are appropriately applied and that the business functions’ resolution of complaint referrals is tracked; and establish procedures to contact taxpayers for missing information. IRS management agreed with six of TIGTA’s recommendations and plans to take corrective actions. However, the IRS disagreed with the recommendation that it ensure its Complaints Referral function establish procedures for case processors to contact taxpayers for missing information in order to work on as many complaints as possible, noting that it is focusing first on resolving the current backlog of complaints and does not have the resources at this time to contact complainants or establish a pilot program to contact those who submit incomplete information. In addition, the IRS only partially agreed with the recommendation that it track the resolution of how complaints were resolved by the various business functions. With respect to the recommendation with which IRS management partially agreed and the other with which IRS management disagreed, TIGTA said it continues to believe that the IRS should track how the business functions resolve referred complaints and should contact taxpayers for missing information on submitted complaints in order to work on as many complaints as possible. IRS deputy commissioner of services and enforcement John M. Dalrymple wrote in response to the report that conditions at the IRS’s Complaint Referrals function have improved significantly since TIGTA began its inspection. “Since the Complaint Referrals office was created in December 2011, we have made significant progress establishing effective processes to handle the large volume of complaints we receive every year,” he wrote. “While TIGTA observed a backlog of unprocessed complaints in September 2013, we have since increased staffing, enhanced our processes and written guidance, and trained RPO employees. Further, we are now using a centralized database to manage the complaints. As a result of these improvements, between January and May 2014, we reduced our inventory backlog by 59 percent. We will continue to reduce the inventory level and increase efficiencies as we analyze results and refine our processes.”

By the letter of the law, I don't know if the program would qualify. Here's some information I found on qualified educational expenses from publication 970: http://www.irs.gov/publications/p970/ch06.html Included in this is: Related expenses. Student-activity fees and expenses for course-related books, supplies, and equipment are included in qualified education expenses only if the fees and expenses must be paid to the institution as a condition of enrollment or attendance. $100 or so, while I'm not suggesting you should do anything unethical, I'm not even sure it would make a difference if you did include it. I personally would lean toward including it given the nominal amount you're talking about.

Just curious as to the cost of the software?

http://www.journalofaccountancy.com/News/201410547.htm AICPA sues IRS to stop return preparer program By Alistair M. Nevius, J.D. July 15, 2014 The AICPA filed suit in the U.S. District Court for the District of Columbia on Tuesday, asking the court to halt the IRS’s recently introduced Annual Filing Season Program. The AICPA’s three-count complaint asks the court to declare the rule implementing the program unlawful and stop its operation. The Annual Filing Season Program, introduced June 30 in Rev. Proc. 2014-42, allows unenrolled tax return preparers and others to receive an annual Record of Completion from the IRS if they complete continuing education courses from IRS-approved providers. Participants must have a valid preparer tax identification number (PTIN) and agree to abide by the rules in subpart B and Section 10.51 of Circular 230, Regulations Governing Practice Before the Internal Revenue Service (31 C.F.R. Part 10). Program participants will be listed in an IRS directory of federal tax return preparers. The AICPA’s complaint is brought under the Administrative Procedure Act (APA), 5 U.S.C. §§551–706, and it alleges that the IRS violated the APA’s notice and comment requirements when it implemented the rule through a revenue procedure. The APA requires federal government agencies to provide for notice and comment, except when issuing “interpretative rules, general statements of policy, or rules of agency organization, procedure, or practice” (5 U.S.C. §553(b ). The complaint states that the revenue procedure implementing the program fits under none of these exceptions. The AICPA also alleges that the rule is “an illegitimate exercise of government power” because it violates the APA and is “an impermissible end run” around the decision in Loving, 742 F.3d 1013 (D.C. Cir. 2014), aff’g 917 F. Supp. 2d 67 (D.D.C. 2013), which held that the IRS does not have statutory authority to regulate tax return preparers. The complaint notes that the rule implements a program that is nearly identical to the mandatory return preparer registration program that was invalidated in Loving. The complaint also notes that the IRS cites no statutory authority that allows it to implement the new rule, and, under 5 U.S.C. §706(2)©, without statutory authority, the program is invalid. The AICPA argues in its complaint that while the program is purportedly voluntary, it will actually be “de facto mandatory because it creates a strong competitive incentive for unenrolled tax return preparers to comply.” In promoting the program, IRS Commissioner John Koskinen has noted that participating in the program will allow return preparers to “stand out from the competition (Ohlemacher, “IRS Announces Voluntary Program to Certify Tax Preparers Who Complete Course, Pass Test,” Associated Press (June 26, 2014)). The AICPA argues that the IRS is thus aware that the program creates a situation in which unenrolled tax return preparers must participate in order not to lose business to those who do. Finally, the complaint states that the rule is “arbitrary and capricious,” that by creating new categories of tax return preparer it will confuse consumers, and that it does nothing to address the issues of unethical or fraudulent tax return preparers who understate income or file invalid refund claims for their clients. The complaint asks the court to declare the rule unlawful, vacate and set aside the revenue procedure, declare null and void any action taken by the IRS pursuant to the rule, enjoin the IRS from implementing the rule, and postpone the effective date of the rule pending the conclusion of the case.

An article from JOA...http://www.journalofaccountancy.com/News/201410503.htm E-filing of amended returns, elimination of Form 1040X among TIGTA recommendations By Sally P. Schreiber, J.D. July 9, 2014 Taxpayers should be allowed to use Form 1040 to amend their returns and should be able to e-file amended returns, according to recommendations made by the Treasury Inspector General for Tax Administration (TIGTA) on Wednesday. Although individual tax returns in the Form 1040 series may all be filed electronically, the IRS can only accept Form 1040X, Amended U.S. Individual Income Tax Return, on paper. According to TIGTA, more than 4 million amended returns were filed in 2012. Because these amended returns are on paper, they must be processed manually, which, TIGTA claims, leads to “potentially erroneous refunds” being paid. In the statistical sample of 259 amended returns TIGTA examined, it found 44 returns with refunds totaling $103,270 that TIGTA believed could have been incorrect. From that number, TIGTA concluded that the IRS could pay out a potential $2.1 billion in erroneous refunds claimed on amended returns over the next five years and that the IRS could protect against this revenue loss by using the same systemic processes used to verify claims on originally filed tax returns to verify amended tax return claims. However, the IRS disagreed with these figures, stating that the flagged returns had been processed correctly and the validity of the claims on them could only be determined by an examination. The IRS did agree with TIGTA’s suggestion that it accept e-filed amended returns, explaining that the ability to accept such returns has been a long-term goal. Nonetheless, the IRS pointed out that its ability to convert to e-filing amended returns depended on its receiving enough funding to implement the program, which is beyond the Service’s control. TIGTA also was critical of the format and appearance of Form 1040X and recommended that the IRS revise Form 1040 to allow taxpayers to amend their returns using it instead of Form 1040X. Although the IRS did not agree with the recommendation, it did agree to consider revising Form 1040X so that the form provided more information to the IRS to use to verify refund claims.

I've always been charged upon renewing, which is normally during the month of May.

Isn't that a by-product of your browser recognizing you and automatically signing you in?

Just wondering if any of you offer a discount for a client's dependent child? If the client includes tax information for their dependent son or daughter, who may or may not be a student, and asks you to complete their return. If there is only a W-2 and maybe a bit of interest or dividends, do you tend to discount what you charge for that?

I tried renewing based on the instructions provided in the email I received. It indicated to input "admin" as the username. I did that...no luck. I receive a "Log-in Failed" message. Has this happened to anyone else?

I had this issue this year. I included the 5329 with the return when we efiled it earlier this month. Within the 5329 there is an opportunity to provide an explanation and also to include seeking to have the penalty reduced. Still waiting to hear from the IRS. Good luck.

Congrats, Jack!

Christian...I believe you're correct, you need to included the name, address and SSN of the seller. I had a client who obtained a seller financed mortgage for their personal home. I indluded the individuals name, address and SSN on line 11 of Schedule A. I assume it would be similar for a Schedule E.

I am in the market to purchase new tax return folders. My current folders were purchased through Tenenz and they have generally offered me good service and quality. I have to call them to see if they offer fodlers with expandable pockets. Seems like the copies I am providing to clients are increased in size . Was hoping for input on where you purchase your folders?

How very sad. And the law makers and President don't seem to care.

I haven't received anything as of yet. I had a good year with ATX and plan on renewing.

I've actually seen an increase in the number of younger clients who have come to me. People who I would classify as professionals and well educated who could easily use Turbo Tax to prepare their returns. Some only have a W2 and a 1099-INT. I'm very confident in the service I offer and while some may think it's foolish, I do let these individuals know that they could save money by filing themselves through a Turbo Tax or State Free File option. No one has ever asked for their paperwork back and I end completing their returns. I think much of that has to do with hearing the media discuss all of the tax changes that have occurred over the past year. I'm not complaining.

Interesting article. May be more suited for the Politics Page? http://thehill.com/blogs/on-the-money/domestic-taxes/203473-gallup-majority-think-taxes-are-fair

As we approach April 15th, I wanted to take a minute to thank everyone on this forum for their time and their sage advice. It's comforting to know that we can turn to this page, add our questions and receive feedback from a professional (some more than others ) group of preparers. I appreciate everyone's input! Thanks also to Eric for all he has done and continues to do for the site! I plan on sending my donation in the next day or two! I hope everyone enjoys a more relaxed few months...until it all starts up again!

i figured it out. I had to populate Schedule B, Line 9 on the 1041.

I've completed a simple 1041 that only contains a small amount of interest and dividends. There are two beneficiaries (son and daughter of the deceased.) I input their personal information on the K-1 input screen and, based on the Will, assigned each of them 50% allocations on Line D of the K-1 input screen. The interest and dividends are not flowing to the respective K-1's. Not sure why and wondering if anyone had any ideas. Thanks!

Thank you, all. I used a program called Full Shot that I believe is similar to Alt+Print Screen. It did not allow me to copy it to the post. I tried pasting it to Word and then copying it from Word to paste on the post and that was not allowed either. It was a very small screen shot.

Thanks for the information. I realized that I could Private Message Eric. I wanted to post on here in the event someone did have success attaching a screen shot and would offer information. Eric, I'll reach out to you if I run into the issue again.

Thanks again for all the responses. This is a New Jersey Estate.

Kea.....can you xxx out a portion of the SSN or just print the last four digits of the SSN in the space provided on the 8879? While I don't know if that is acceptable by IRS standards, security is obviously a hot topic and safe guarding SSN is prudent. I think it's easily explained should you ever be questioned.

Eric...is it possible to attach screen shots to posts? When I've tried to do that, I received an error message that indicates I am not allowed. Just wondering if there are security or memory issues that disallow that?