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National Taxpayer Advocate Delivers Annual Report to Congress; Discusses Tax Reform Implementation and Unveils “Purple Book”

National Taxpayer Advocate Nina E. Olson today released her 2017 Annual Report to Congress, describing challenges the IRS will face as it implements the recently enacted tax reform legislation.

She also unveiled a new publication, “The Purple Book,” that presents 50 legislative recommendations intended to strengthen taxpayer rights and improve tax administration.

Implementation of Tax Reform Legislation

The National Taxpayer Advocate’s report says the reduction in IRS funding since FY 2010, approximately 20 percent in inflation-adjusted terms, has challenged the agency’s ability to perform the basic tasks of administering the tax system.  “As the National Taxpayer Advocate, I see daily the consequences of reduced funding of the IRS and the choices made by the agency in the face of these funding constraints,” Olson wrote in the preface to the report.  “These impacts are real and affect everything the IRS does.  Funding cuts have rendered the IRS unable to provide acceptable levels of taxpayer service, unable to update its technology to improve its efficiency and effectiveness, and unable to maintain compliance programs that both promote compliance and protect taxpayer rights.  ’Shortcuts’ have become the norm, and ‘shortcuts’ are incompatible with high-quality tax administration.”

The report says the IRS is already struggling to meet the service needs of U.S. taxpayers, particularly with regard to telephone service.  In most years, the IRS receives more than 100 million telephone calls.  Even prior to the enactment of the tax reform legislation, the IRS was projecting it would only be able to answer about six out of 10 calls from taxpayers routed to speak with a telephone assistor during the filing season and about four out of 10 taxpayer calls during the full fiscal year.

There is a lot of information in this report, re: challenges to meeting taxpayers’ needs and Congressional mandates -- too much to detail in this short space.  See the IRS’ News Release (IR-2018-3) and/or the Taxpayer Advocate’s Annual Report.

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