The California Franchise Tax Board (FTB) recently issued a news blast that many payments sent by mail to the state tax agency in June were delayed significantly due to post office issues. When the mail finally caught up on June 9th, the FTB received some 115,000 payments for estimated taxes and other purposes. The agency is working to process all the backlogged payments now and will post them with a timely date of June 15, 2019. However, this should serve as a reminder to try to issue online payments to tax agencies whenever possible!
The Treasury Inspector General for Tax Administration (TIGTA) recently released its Semiannual Report to Congress for the period October 1, 2018 through March 31, 2019. During this period, TIGTA completed 20 audits and 1,068 investigations concerning taxpayer data security, identity theft and impersonation fraud, tax compliance, and IRS efficiency. Of particular concern for this report and future monitoring was the effect of the lapse of appropriations for the IRS just before the start of the first tax season to incorporate changes from the Tax Cuts and Jobs Act of 2017 (TCJA).
The Internal Revenue Service (IRS) recently issued a warning about a new phone scam involving fake calls from the Taxpayer Advocate Service (TAS). Tax scammers are using "spoofed" TAS phone numbers to contact potential victims to obtain personal information and payments. The IRS reminds taxpayers that TAS does not typically initiate calls to taxpayers, unless the taxpayer has requested assistance first.
The Internal Revenue Service (IRS) recently kicked off its annual "Dirty Dozen" awareness campaign to alert taxpayers to common tax scams. Topping the list in 2019 are new variations on phishing schemes that use "legitimate-looking emails with fake, but convincing website landing pages," social media links, and other methods to obtain taxpayers' personal information.
The California Franchise Tax Board (FTB) recently announced that interest rates for personal income tax underpayments and overpayments, corporate underpayments, and estimate penalties will increase to 6 percent for 2019. The corporate overpayment interest rate will increase to 2 percent this year. For more information, click here.
After a two-year vacancy, the Internal Revenue Service (IRS) has a Chief Counsel again. Michael Desmond, a California tax attorney originally nominated by President Donald Trump last year, was confirmed 83-15 today by the Senate to oversee regulation drafting and provide guidance on federal tax law matters to the agency. Read more here.
Recent news accounts have claimed that federal taxpayers are receiving smaller tax refunds for the 2018 filing season, implying that their taxes are higher as a result of the 2017 Tax Cuts and Jobs Act. According to research by the Wall Street Journal, however, although refund amounts are indeed lower this year for many individuals, it is not necessarily a result of higher taxes.
National Taxpayer Advocate Nina E. Olson recently released a report to Congress concerning the problems facing taxpayers with respect to their interactions with the Internal Revenue Service (IRS). For the 2018 filing season, she cites the government shutdown as the top concern: "The five weeks could not have come at a worse time for the IRS---facing its first filing season implementing a massive new tax law, with a completely restructured tax form." Severely outdated technology is the biggest roadblock to overcoming this challenge, which will require a major shift in federal funding strategy to fix.
The Treasury Inspector General for Tax Administration (TIGTA) recently released its biannual independent assessment of the Internal Revenue Service's (IRS') private debt collection program, which became a requirement under the 2015 FAST Act. According to TIGTA, the private collection agencies are performing well with respect to procedural accuracy and professionalism. Customer satisfaction scores are generally in the low- to mid-90 percent range. As of September 2018, the private collectors had been assigned more than 700,000 taxpayer accounts and collected approximately $88.8 million from the balances owed.
The Internal Revenue Service (IRS) recently posted its contingency plan for managing operations during the federal government shutdown, which includes reducing its available workforce for IRS functions by over 87 percent. Employees may be kept on for half a day to ensure an orderly close-down of operations. After the half-day period, most IRS activities will cease, including the issuing of refunds, processing amended returns, responding to taxpayer phone calls, and providing legal counsel. All audit functions will also stop during the shutdown period.