IRS Automated Underreporter Program

Transcription

1 IRS Automated Underreporter Program Presenter Name Title Date The information in this presentation is current as of the date it is presented and should not be considered official guidance.

2 Automated Underreporter Process Overview Computer Matching Inventory (case) Selection Screening Responses Case closure Reconsideration

3 Automated Underreporter Matching and Case Selection IRS matches returns with information from third parties Matching begins after original return due date AUR cases are created after potential discrepancy identification

4 Automated Underreporter Screening Tax examiners attempt resolution of the discrepancy prior to taxpayer contact CP 2501 preliminary contact CP 2000 proposed changes and tax calculations Statutory Notice of Deficiency (Letter 3219) 90 Day Letter

5 CP 2000

6 Automated Underreporter Response Process AUR issues a notice or letter Cases are controlled in a suspense file The suspense file has a pre-set suspense period based on notice/letter type Controlled responses remove cases from suspense No response received

7 Automated Underreporter Response Process If taxpayer disputes the proposed liability: Taxpayer sends in response or makes telephone contact IRS AUR Unit reviews taxpayer response Possible phone contact made Determination made on case

8 Automated Underreporter Responding Respond timely Include the Response Page even if faxing the response Use the return envelope Include detailed explanations Provide contact information

9 AUR - Helpful Hints Do not group or net amounts Report income on correct line Include explanation of incorrect payer data Include all back-up schedules

10 CP 2000 Practitioner Preferential Call Routing to AUR 1) IRS Practitioner Priority Service ) Menu Option 5 - Automated Underreporter Notice

11 AUR Compliance Program Key Points: Respond to notice Cooperate to resolve issues

12 Publication 5181

13 Automated Underreporter Program Resource Page Pub 5181 Tax Return Reviews by Mail Pub 3498-A The Examination Process (Audits by Mail) Pub The Audit Reconsideration Process IRS Videos - Your Guide To An IRS Audit IRM Part 4 - Examining Process Use of Electronic Accounting Software Records - FAQ's

14 Christopher V Thornton EA, MBA, NTPI Fellow BBA IN ACCOUNTING AND FINANCE ADELPHI UNIVERSITY 1978 MBA IN ACCOUNTING AND FINANCE ADELPHI UNIVERSITY 1982 ENROLLED AGENT SINCE 2004 PRESIDENT OF NJSEA 2012/2013 AND 2013/2014 ASSOCIATE MEMBER OF AICPA AND NJSCPA SINCE 2006 PASSED CPA EXAM USING GLEIM IN 2005/2006 NTPI FELLOW 2011 LEDERSHIP ACCADEMY 2012 OVER 50 CREDIT EDUCATION HOURS ON TAX PREPARATION AND REPRESENTATION EVERY YEAR SINCE VP OF WEST WINDSOR LL SINCE 2004 MERRILL LYNCH VP OF TECHNOLOGY/INFORMATION SYSTEMS H & R BLOCK 2001 THRU 2003 PRESIDENT OF E TAX SERVICES LLC 2004 THRU PRESENT EXPERTISE IN TAX PREPARER INDIVIDUALS, SMALL BUSINESS, TAX EXEMPT, FIDUCIARY TAX REPRESENTATION AUDITS, COLLECTIONS, OIC AND NON FILERS.

15 Bio Lisa Chan Lisa Chan has been with the Internal Revenue Service since October She started out working in Submission Processing for several years. She has worked in many areas in SBSE such as Centralized Insolvency, Document Matching, Automated Underreporter, and Examination. Before being selected as the Examination Operation Manager in September 2015, she had responsibility over Correspondence Examination and Examination Specialty programs. Lisa is a 2007 Department Manager Readiness graduate and 2012 Senior Manager Graduate. She has worked on Headquarter projects, high level assignments, and several temporary detail assignments. Lisa has been an active leader on new programs and pilots to the IRS such as Centralized Insolvency, Identity Theft, and Taxpayer Digital Communication. On a personal note, Lisa is married and has three adult children.

16 Biography Mary Hannah 2970 Market St Phila. Pa (267) Mary has gained extensive Senior Management experience over the 35 years of her career. She currently has oversight of the AUR (Automated Under-reporter) Operation, both the paper and telephone functions. Her background covers Submission Processing, Error Correction, Collection, ACS Support and ACS (Automated Collection System). She is involved in leadership training, covering the course writing, training new instructors and delivering the course to new managers.

17 Correspondence Examinations Presenter Name Title Date The information in this presentation is current as of the date it is presented and should not be considered official guidance.

18 Objectives Review: Correspondence Exam process Issue resolution Case closure 2

19 Correspondence Examinations Efficient Broad compliance coverage Highly automated Campus operations IRS Audits webpage 3

20 Inventory Analysis and Selection Identify returns with high potential for a tax adjustments using: Results of prior audits Third party information Entries on the return 4

21 Inventory Analysis and Selection Referrals from: Criminal Investigation Preparer /promoter actions Non-filer conditions 5

22 Correspondence Examinations Defined scope Generally less complex Focus on documenting specific tax return entries 6

23 Common Examination Issues Earned Income Tax Credit Schedule A Employee business expenses Charitable contributions Schedule C Emerging issues Non-filing conditions 7

24 Common Initial Letters and Notices Initial contact letters, no examination report CP 18/19 Unallowable Items CP 75/75A Earned Income Tax Credit CP 06/06A Premium Tax Credit Letter 566 Most other issues Combination Letter: Letters 1862 or 1864 and examination report 8

25 Letter 566 9

26 Enclosures with Initial Contact Letters Forms 886 and Questionnaires Publication 3498-A 10

27 Acknowledgement and Interim Letters Acknowledgment Letter 3500 Interim Letter

28 Publication 3498-A 12

29 Common Follow Up Letters and Notices Letter 525/692 Follow-up including the examination report Form 4549 Form 886-A Letter Statutory Notice of Deficiency, ( 90 Day Letter) Letter 555 Follow up after Letter 3219 issuance 13

30 Resolve Disagreements and Reconsideration Resolve Disagreements Reconsideration Publication 3598, The Audit Reconsideration Process 14

31 Correspondence Examinations - Key Points Respond to notices timely Ask for additional time to respond if needed Provide a complete and organized response Fax or mail documentation Work with IRS to resolve issues Reconsiderations 15

32 Practitioner Priority Service For expedited access to Correspondence Exam contact PPS: Call At the voice prompt press or say 6 16

33 Questions? 17