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77: IRS Service Problems, Funding, and Returning to “Normal”
Episode 7728th December 2021 • Taxgirl Podcast • Kelly Phillips Erb
00:00:00 00:37:20

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While many may have complained about long call wait times and difficulty seeking IRS help in the past, the pandemic has exacerbated service problems such as these for the federal agency. As a result, today, it takes longer for claims to be addressed, and for taxpayers and practitioners alike, the process of reaching an IRS service representative seems nearly impossible.

Who is to blame for the IRS's service issues, and what can be done to resolve them?

On today's episode of the Taxgirl podcast, Kelly is joined by Bill Smith to talk about the IRS's difficulties that have emerged since the pandemic and what we can expect in the future. Bill is the Managing Director of the CBIZ MHM's National Tax Office in Washington DC. He has more than 40 years of experience in both the public and private sectors. In his current role, he consults nationally on a broad range of tax services, including foreign and domestic transactional tax planning for corporations, partnerships, LLCs, and individuals.

Listen to Kelly and Bill discuss expectations for IRS processes returning to “normal” after the onset of COVID-19:

  • What are Bill's thoughts on the IRS's current operating procedures for addressing taxpayer questions and concerns? What changes has he noticed since the onset of COVID-19?
  • Are taxpayers aware of the modern-day challenges and delays involved in communicating with IRS representatives today, or are tax practitioners more alert to the difference in practices between now and pre-pandemic? How does this affect the relationships between tax practitioners and their clients?
  • Bill speaks on what he describes as the" ripple effects" of the IRS's poor operating status. Taxpayers and tax practitioners can't get the IRS to respond to them promptly, and the IRS's use of only paper requests makes it easy for things to get lost or confused. These issues can affect not only taxpayers but their businesses, their relationships with professionals, the practices of tax professionals, and so on. 
  • How may the Taxpayer Advocate Service's office's recent announcement about not accepting certain cases impact businesses and citizens who would not receive their refunds on time?
  • Bill believes that the IRS faced such significant hardships due to their adjustment to remote working. How was their situation different from any other company's, and to such a great extent? In what ways did the stimulus payments affect the IRS processes and contribute to their slow processing and production difficulties? 
  • Kelly and Bill discuss the IRS's technology as partially to blame for their operational issues. How could their technology be improved to resolve some of these problems? Could the controversy over the IRS's funding be contributing to its technology and operational issues? 
  • How would the proposed amendment to the Build Back Better Act affect the IRS's processes? If the Act's amendment gets passed, the responsibility will fall on the IRS to explain and implement it. Could this cause adverse effects, considering their current operational status? 
  • It is easier for the IRS to handle "lower hanging fruit" items such as smaller business audits rather than going after the more sophisticated tax issues. How would an amendment that caps the salary of the people who can be audited change this trend? Would the amendment impact the IRS's income, and if so, what would that mean for their future?
  • What would Bill consider priorities, or areas of importance to taxpayers, if he were in charge of allocating additional funding to the IRS? Bill explains what areas of the IRS he believes should receive funding in order to restore normalcy to its processes.

More about Kelly:

Kelly is the creator and host of the Taxgirl podcast series. Kelly is a practicing tax attorney with considerable experience and knowledge. She works with taxpayers like you every day. One of the things that she does is help folks out of tax jams, and hopefully, keep others from getting into them.

You can find out more about Kelly here and you can follow her on Twitter, Facebook, Instagram, and Linkedin.

To subscribe to the podcast (it’s free!) using Apple, Spotify, or your favorite listening app, click here.

Links:

Kelly’s Website – Taxgirl

Bill’s Twitter – @BillSmithTax1 

Bill’s LinkedIn – Bill Smith

Bill’s Company Profile – CBIZ

Bill and Kelly’s Forbes Article – Forbes

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