The IRS is Planning to Scale Back Taxpayer Assistance

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An in-house watchdog has warned that IRS is planning to scale back many services that will freeze out millions of taxpayers or make them pay for tax advice. According to National Taxpayer Advocate Nina Olson, there’s a plan to scale dramatically back face-to-face and telephone service for 11 million businesses and 150 million individual taxpayers seeking information and help.

Olson further said that the service cutbacks will force more and more and more taxpayers to turn to software such as TurboTax and tax preparers to file their returns, and the IRS should be more open about the proposed changes. Millions of filers will have to bear considerably higher costs.

The report further said that the intension of the IRS, so far, is to be implicit in the plan and explicit in internal discussions in order to substantially reduce face-to-face and telephone interaction with taxpayers. The report demands to know exactly how much money the IRS wants to save in the process and how much assistance it will actually provide taxpayers.

The IRS said while responding to Olson’s report that the report has painted a wrong picture. It further said that taxpayers have been asking for new options to interact with the agency and that they want to move more and more communications online so that resources are freed up for traditional services.

The statement further said that increasingly making self-service interaction available frees up the resources for those who actually need them, including the taxpayers who don’t access to a computer or are not comfortable with online interactions with the IRS. It also says that IRS is fully committed to personal services to taxpayers.

IRS receives over 100 million calls every year from taxpayers currently and more than 5 million taxpayers visit the walk-in assistance centers of the agency. The plan has been under development for a year-and-half. Millions of taxpayers are not willing to share sensitive information online and millions more simply do not want to go on the internet, according to Olson.

Republicans in Congress have imposed budget cuts on the IRS prompting the agency to scale back taxpayer services. The agency has already stopped assisting low-income taxpayers in filing their returns and is conducting fewer audits. The calls of many taxpayers are not answered and those who get through receive answers only to the simplest questions.

The IRS finally received a budget boost that included $290 million for taxpayer assistance after it faced a 19 percent cut in the budget since 2010. Olson said that though there are many effective components in the new plan such as it will speed information to taxpayers and they will no more depend on face-to-face interaction with the agency, not all problems of taxpayers can be solved through online assistance.