Questionable solution: IRS outsourcing taxpayer communication.
By Rick Telberg
CPA Trendlines
A few years ago the Internal Revenue Service launched a belt-tightening overhaul it called The Future State.
The changes were devised with good intentions. The service wanted to deal with taxpayers more through the Internet and less over the phone or in person. It would also expect taxpayers to hire outside tax specialists to give them advice that the IRS had once offered as a free service.
Ideally, all of this would reduce the cost of collecting taxes. But the Taxpayer Advocate Service soon warned that the changes would lead to more aggravation and less goodwill among taxpayers. Less goodwill, the TAS said, could lead to less compliance, which translates into less revenue to the United States Treasury.
The IRS heard the warnings and initiated a country-wide series of forums and a website dedicated to explaining the Future State plan. IRS representatives even went before Congress to explain that the service was not eliminating all phone or personal contact with taxpayers.
National Taxpayer Advocate Nina Olson, who heads the TAS, commended the IRS on these outreach efforts, but she felt that the real problems had not been addressed. The plan failed to consider and incorporate the needs and preferences of people who are expected to voluntarily comply with their tax obligations, i.e., American taxpayers.
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