(Washington, DC) The IRS Restructuring and Reform Act of 1998 (RRA 98) has helped improve the IRS in the past decade, said keynote speakers Senator Rob Portman and former Senator Bob Kerrey at the IRS Oversight Board March 2, 2011 public meeting. The Senators co-chaired the National Commission on Restructuring the IRS, which called for major changes in the IRS, and culminated in the passage of RRA 98. Among the changes recommended by the Commission was the establishment of the IRS Oversight Board, which is led by private sector members who provide expertise, continuity, and accountability to the governance of the IRS.
Senator Portman noted that since the passage of RRA 98, taxpayers are receiving better, more accurate phone service, while 70 percent of individuals file electronically – up from 20 percent in 1998. He praised the Oversight Board for helping the IRS identify problems and solutions. “It is important for the Board to look at the long term, and to bring together the best and brightest to focus on how to make tax administration better,” he commented.
Former Senator Kerrey, who served as the President of the New School in New York City from 2001 to 2010, called the IRS “one of the most under-appreciated successes” in the country and the best tax administration system in the world. He warned the nation against complacency in improving the tax administration system.
In addition to keynote speakers, the event included panel discussions regarding the future of tax administration. Nancy Killefer, Senior Director and Head of the Washington, DC office of McKinsey & Company, and formerly Board Chair from 2002-2005, moderated a discussion on people and partnerships. Pamela F. Olson, Esq., a partner at Skadden Arps Tax Group and former Assistant Secretary for Tax Policy at the U.S. Treasury,moderated a discussion on business processes and technology. Panelists agreed that modernized technology is the most critical aspect of a successful future tax administration. Strong enforcement was also viewed as vital. Many agreed that the nation’s increasingly complex tax code creates a challenge for taxpayers who seek to be compliant.
A summary report on the meeting will be available in the coming weeks at www.irsoversightboard.treas.gov.
Board Discusses Status of Filing Season, Modernization, IRS Budget and Diversity
At its March 3, 2011 meeting, the Board discussed the 2011 filing season, progress on the Customer Account Data Engine 2, IRS workforce diversity, and results in a year-long effort to improve collection services. The Board was briefed on the status of the implementation of tax preparer registration, and met with the National Taxpayer Advocate to discuss her annual report to Congress. The Board also discussed the IRS FY2011 and FY2012 IRS budgets.
The IRS reported the filing season as successful so far, with nearly 52 million returns filed as of February 25, approximately the same number at this point in 2010, despite a late start in the season for those affected by late legislative changes in the tax code. In addition, the IRS briefed the Board on its first mobile phone application, “IRS2Go,” which allows users to check the status of their refunds and to find contact information for the IRS.
The IRS reported on its Collection Process Study, which was conducted over the past year. The study reviewed the IRS current collection processes and made recommendations to improve the system. Among the recommendations include offering “fresh starts” for taxpayers, focusing on compliance initiatives and early interventions for taxpayers at risk for not filing their returns.
The Board discussed the status of IRS tax preparer registration. So far, 680,000 tax preparers have received “preparer tax identification numbers,” or PTINs.
Finally, the Board reviewed the status of the IRS FY2011 and FY2012 budgets. All federal agencies continue to operate under an FY2010 continuing resolution until March 18th. The Board is developing its updated recommendations on the IRS FY2012 budget, and will release a special report on the topic in the coming weeks.