The Internal Revenue Service Advisory Council (IRSAC) released its annual report today, which included recommendations for improving efficiency at the IRS.  Here are some of the points that stood out to me:

1. Expand awareness of OPA

Online Payment Agreement (OPA) is a tool that some taxpayers may use to enter into installment agreements if they meet certain criteria.  IRSAC says that the IRS should be doing more to encourage taxpayers to use OPA rather than call and waste their time on the phone.

 Of the more than 3.1 million total installment agreements created in FY 2012, less than 3 percent (92,519) used the OPA to enter into an installment agreement.

The reason I don’t use OPA is I have found that getting a live body on the phone normally results in a better deal.   Plus, the other day I was playing around with it and it wasn’t even working.

2. Reduce processing time for Form 2848, Power of Attorney

3.4 million Power of Attorney forms were filed in fiscal year 2012, but less than 10 percent were filed electronically.  The IRS subsequently discontinued electronic filing a few months ago.  IRSAC recommends going back to electronic filing and making changes to the form in order to reduce errors that cause them to be returned.  I use e-fax to file my Power of Attorney forms.  It is quick, inexpensive, and paperless — as close to electronic filing as you can get.  In my experience, the processing time has been relatively quick: around 5-7 days usually.

One of the other problems that IRSAC addressed is duplicate filing, which happens when a practitioner files a 2848 and then doesn’t have the patience to wait a week.  If that practitioner then calls the IRS and tries to gain access to the account before the POA has been processed, the IRS representative will have him/her fax the POA while waiting on the phone.  Sometimes the IRS rep will forward that POA on to the CAF Unit without first checking with the practitioner to see if it has already been filed.

3. Update the transcript request policy on the PPS Line

The Practitioner Priority Service (PPS) phone line is for tax attorneys, accountants, enrolled agents, and such.  If you have ever dealt with the IRS by phone then you know how ridiculous the hold times can get.  The IRS call center employees should be answering unique questions, taking financial information, and resolving tax accounts; they shouldn’t have to do something that a practitioner can easily do him/herself.  Some firms have a habit of calling in and tying up phone lines for simple transcript requests when transcripts can more efficiently be ordered electronically via the IRS website or through the automated phone system.