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Tax Talk Blog for Tax Pros

Welcome to TaxBlawg, a blog resource from Chamberlain Hrdlicka for news and analysis of current legal issues facing tax practitioners. Although blawg.com identifies nearly 1,400 active “blawgs,” including 20+ blawgs related to taxation and estate planning, the needs of tax professionals have received surprisingly little attention.

Tax practitioners have previously lacked a dedicated resource to call their own. For those intrepid souls, we offer TaxBlawg, a forum of tax talk for tax pros.

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Will "Starving the Beast" Mean the End of the Taxpayer Advocate's Office?

Your writer has been dealing with tax disputes for over 40 years, and believes that the two most important developments for taxpayers were the passage of the 1998 IRS Restructuring and Reform Act, and the creation of the Taxpayer Advocate Service ("TAS," formerly known as the "Problem Resolution Office" and the "Ombudsman").  The Advocate created to assist taxpayers where, for lack of a better term, the system simply was not working properly, and for most of its existence has done a wonderful job.

Well, that organization's health now appears to be in peril.  IRS Commissioner Shulman has warned that threatened budget cuts were going to adversely impact the IRS' enforcement and service roles.  No one in Congress has, to this writer's knowledge, reacted whatsoever to his warning.  The TAS is part of the "service" side, and as the years have passed, the Commish and his people have been more and more frustrated with efforts the TAS has made on behalf of taxpayers, and always seem to be trying to cut back its authority.  On October 1st, the National Taxpayer Advocate announced that the TAS is "temporarily limiting its acceptance" of cases where the taxpayer's problem involves an IRS delay in processing tax documents so long as the taxpayer is not "currently facing an imminent threat of enforcement action" or otherwise faced with some sort of economic burden.

For many years, particularly since the IRS reorganization in the late 1990s, personnel staffing at the IRS to process returns, deal with unpostable returns and payments, deal with amended ones and innocent spouse claims, and perform other routine functions seem to have been cut back.  This writer has experienced many situations where a normal filing has gotten "lost" in the system, and his attempts to deal with the people "in the system" has proven to be a gross exercise in futility.  Only the Taxpayer Advocate has been able to break the logjam and get things moving.  Now, it appears that this avenue of recourse is in doubt, and if in fact the "beast" is "starved" in a manner that reduces the funding for the TAS, the ability of that organization to help taxpayers will be further crippled.

Your writer does not wish a bad IRS experience on anyone.  Well, maybe a few people, but for the most part, it is something no taxpayer should have to endure.  If the blind and mindless budget cutters have their way, and the demise of the TAS comes about, I can foresee a situation in which one of those people most proud of seeing funds taken from the IRS has the kind of problem that only the TAS could solve, and is told by his professional that there simply is no recourse anymore.

When asked what else can be done, I would tell that champion of budget cutting to "write your Congressman."  Perhaps that's what all of us should be doing right now – writing our Congressman to explain that this is one area the Commissioner should not be permitted to cut under any circumstances, and that if taxpayer "service" is to have any meaning, the Taxpayer Advocate needs to be strengthened.

  • George W. Connelly

    George Connelly is recognized as one of the leading federal tax litigators in the United States.  His practice focuses on IRS audit, collection and criminal matters including civil and criminal tax litigation matters, for clients ...