Revenooer Rants: Revenooers girding for more scrutiny
Seems the House thinks it’s time for more oversight of IRS goings on. This according to legislation passed in that chamber just last week.
Republicans think it’s time — in consideration of a Treasury Inspector General for Tax Administration’s (TIGTA) report that found the IRS, from 2010 to 2013, actually rehired hundreds of former employees who had experienced significant performance or conduct issues.
Seems Representative Kristi Noem (R-S.D.) decided that enough was just enough, resulting in her authoring legislation because of her finding that IRS has repeatedly rehired employees who had been absent without leave for weeks at a time, and who had accessed sensitive taxpayer information for nefarious purposes.
“IRS leadership has failed to acknowledge its mistakes or change its processes. Instead, they stuck their heads in the sand,” quoth Noem.
And in companion legislation, IRS would be prevented from paying employee bonuses until the bureau implements a comprehensive customer service strategy.
We won’t be holding our breath on this one, given historical track records. Yet another GAO report has found that in fiscal 2015, only 38 percent of callers to IRS who were looking for technical assistance from a real person actually received it — only after suffering through an average wait time of more than one half hour!
“We’re asking very simply in the bill, do your job,” said Representative Patrick Meehan (R-Pa), the bill’s author. “And until you’ve done that job, which other agencies are very capable of doing, no bonuses get paid.”
We hear IRS received a $290 million budget increase for 2016, to which Commish Koskinen attributes significantly improved “customer service” this year.
He noted that the rate of taxpayer telephone calls answered during the recently-concluded filing season was above 70 percent (Holy Cow!!) and that the average telephone service level will be about 47 percent for the year.
And from our “nice try” department comes yet another reminder (from the Tax Court) that ignorance of the law is no excuse.
So found out Nik Lamas-Richie (and his spouse) who was an LLC member who timely filed his 2011 tax return, though omitted any income (albeit undistributed in cash) derived from the LLC which filed its own return late, and did not provide him the usual Schedule K-1 until September of 2012.
The Court reminds us that the case law is replete with examples of the fact that “a partner must report his distributive share whether or not received” even if he was not aware that such income existed at the time it was earned.
Indeed, the partnership’s failure to supply the taxpayer with a timely Schedule K-1 does not relieve the taxpayer of the obligation to include in taxable income the taxpayer’s distributive share of the partnership’s profits — even if the amount was unknown — and should have been estimated.
CONSULT YOUR TAX ADVISER – This article contains general information about various tax matters. You should consult your CPA regarding the implications to your particular situation. Jeff Quinn is a CPA, recently retired from Ashley Quinn, CPAs and Consultants, Ltd., with offices in Incline Village and Reno. He welcomes comments at firstname.lastname@example.org.