Taxpayer Advocate Wants More Money Spent on Collections

Shouldn’t the Taxpayer Advocate be focused on providing high quality tax relief within the bounds of the law?

The Taxpayer Advocate Service (TAS) describes themselves as an “independent organization within the IRS whose employees assist taxpayers who are experiencing economic harm, who are seeking help in resolving tax problems that have not been resolved through normal channels, or who believe that an IRS system or procedure is not working as it should. ”

Today the TAS submitted its biannual report to Congress which evaluates IRS’s progress in 2010 and spells out its objectives for 2012. Here are some key points:

  • IRS resources are being strained due to new programs and less funding. New programs have resulted in higher call/inquiry volumes and there is less money available to pay for employees to field these calls and question.
  • TAS praises the IRS for making improvements to lien filing procedures, but does not believe it is doing enough. TAS suggests that the IRS cease filing liens based on amount owed, and instead look at the individual ability to pay. If the taxpayer is suffering from an economic hardship, no lien should be filed.
  • Dwindling resources resulted in more “bright-line” tests used by IRS employees; in other words, less discretion and less consideration of taxpayers’ individual circumstances.

The TAS also cited an interesting statistic: In 2010 the government spent $12.1 billion to run the Collections Department of the IRS, and that department collected $2.35 trillion in revenue (that’s $194 for each dollar spent). The TAS cited this statistic to show just how successful the IRS is in collecting taxes and to make their case for increased funding for these collection efforts. In fact, the TAS wants the IRS to be exempt from budget caps or reductions.

In my opinion, the TAS’s push for more funding seems inconsistent with their stated goal of looking out for the best interests of the taxpayer. What kind of advocate would be so interested in beefing up Collections?

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