Topics Include Office of Promoter Investigations, Fraud Enforcement Office Update, and the Introduction of Several New Office Directors
As reported by Tax Chair, Stephen Mankowski, CPA, CGMA, who recently attended the monthly IRS Meeting.
New Resources Relative to Child Tax Credits Can Be Found Here
Office of Promoter Investigations
This newly created service-wide office is being headed by Lois Deitrich, a 20-year veteran of the agency. Deitrich is working on agency-wide compliance issues, including coordination of promoter activities with other business divisions, including Large Business & International, Tax Exempt/Government Entities, Office of Fraud Enforcement, and Criminal Investigations. The office works with data analytics and operates like a think-tank to identify promoter behavior prior to auditing returns. Currently, they are working internally but will be shifting their focus to outreach with practitioners, in the hope of identifying tax schemes as early as possible.
Updates on Forms 940X/941 Inventory
This year continues to be unique and present filing issues. Tax law changes have made it more difficult to provide the level of service needed. The IRS has hired over 3,200 employees to cover attrition and to increase staffing. Austin and Fresno have been tapped to help process Form 941 returns to help reduce the backlog. As of mid-July, approximately 1.8M forms have not yet been processed. For returns prior to 2021, 11K are still in inventory. These figures are for 941 returns, not 941X amended returns.
Updates About Notices, Liens & Levies
The IRS began sending letters from the Automated Collection System (ACS) function in June. The income tax levy program will be restarting in July. This includes state tax levy and treasury payments. In addition, Responsible Officers (ROs) continue to work on non-filer cases and sending out notices and billing notices; however, their focus is primarily on egregious cases, such as high-income non-filers.
Introduction of Field Director of Exam
Lou Ann Kelleher recently became the Field Director of exam for SB/SE in mid-June. She was formerly the Field Director for the Western Region in Denver. Field Exam focuses on areas of non-compliance, including areas and priority categories from Congress: high income, offshore referrals, high wealth, and preparer promoter cases.
Update from the Fraud Enforcement Office (FEO)
The Office is now about one year old. It has been dealing with emerging threats and evolving frauds. The National Fraud Counsel is a dedicated group that began as a one-year test and is now being expanded. The Emerging Threats Mitigation Team is the data analytics arm that identifies threats—basically where investigation meets data science. They deal with the gig economy (and decentralized finance), high net worth non-filers and falsification of asset disclosure statements. With the gig economy, this is much more than Uber-type drivers; they are looking at internet activity that is not reported. They also cover fuel tax and other refundable credit schemes. Fraud Enforcement Advisors deal with case-specific issues in the field. In addition, the FEO has been dealing with Virtual Currency and PPP fraud issues.
Deputy Commissioner of Services & Enforcement
Douglas O’Donnell, Deputy Commissioner of Services & Enforcement recently transferred to this Office from the Large Business & International (LB&I) Division. His office primarily deals with addressing compliance within the IRS. This includes whistleblower, LB&I, and other areas, as well as budgeting to ensure the ability to hire and screen applicants so that they can be placed into the proper area within the IRS.
Thank you and please look for more topics in my next IRS update communications.
The National Conference of CPA Practitioners (NCCPAP) is a professional organization comprised of Certified Public Accountants practicing in the United States. In addition to serving as a forum for education, networking, and community impact, NCCPAP also advocates for its clients. NCCPAP influences tax administration and tax policy by regularly meeting with Internal Revenue Service representatives, state taxing authorities, and elected officials. NCCPAP members represent over one million businesses and individual clients. The organization is headquartered in Woodbury, NY. For more information visit, www.NCCPAP.org.