Taxpayer advocate: IRS underfunded, overworked
Taxpayer advocate: IRS underfunded, overworked
An expanding workload and declining funding for the Internal Revenue Service (IRS) will further erode the services it provides taxpayers, an official warned Congress today.
National Taxpayer Advocate Nina Olson today released her annual report to Congress, identifying the combination of the IRS’ expanding workload and declining resources as the most serious problem facing taxpayers. The result, the report says, is inadequate taxpayer service, erosion of taxpayer rights and reduced tax compliance.
“This is causing the IRS to resort to shortcuts that undermine fundamental taxpayer rights and harm taxpayers – and at the same time reduces the IRS’ ability to deliver on its core mission of raising revenue,” Olson said.
There were more than 4,400 changes were made to the tax code in the past decade, an average of more than one a day, including an estimated 579 changes in 2010 alone, the report said. Those changes required the agency to explain each new provision to taxpayers, write computer code so it can process returns affected by the provision, and train its auditors to identify improper claims.
In addition, the report said, an expansion of refundable credits in recent years, among them the First-Time Homebuyer Credit, the Making Work Pay credit and the American Opportunity tax credit, has helped spawn an increase in illegal activity that seeks to profit off the tax system by filing bogus refund claims and often by stealing and using another taxpayer’s identity.
Olson also expressed her concern that the IRS’ expanding use of automated processes to adjust tax liabilities is causing harm to taxpayers and recommended that Congress enact a comprehensive taxpayer bill of rights.
An expanding workload and declining funding for the Internal Revenue Service (IRS) will further erode the services it provides taxpayers, an official warned Congress today.
National Taxpayer Advocate Nina Olson today released her annual report to Congress, identifying the combination of the IRS’ expanding workload and declining resources as the most serious problem facing taxpayers. The result, the report says, is inadequate taxpayer service, erosion of taxpayer rights and reduced tax compliance.
“This is causing the IRS to resort to shortcuts that undermine fundamental taxpayer rights and harm taxpayers – and at the same time reduces the IRS’ ability to deliver on its core mission of raising revenue,” Olson said.
There were more than 4,400 changes were made to the tax code in the past decade, an average of more than one a day, including an estimated 579 changes in 2010 alone, the report said. Those changes required the agency to explain each new provision to taxpayers, write computer code so it can process returns affected by the provision, and train its auditors to identify improper claims.
In addition, the report said, an expansion of refundable credits in recent years, among them the First-Time Homebuyer Credit, the Making Work Pay credit and the American Opportunity tax credit, has helped spawn an increase in illegal activity that seeks to profit off the tax system by filing bogus refund claims and often by stealing and using another taxpayer’s identity.
Olson also expressed her concern that the IRS’ expanding use of automated processes to adjust tax liabilities is causing harm to taxpayers and recommended that Congress enact a comprehensive taxpayer bill of rights.
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