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MSP #13: MILITARY ASSISTANCE

The IRS’s Customer Service and Information Provided to Military Taxpayers Falls Short of Meeting Their Needs and Preferences

TAS Recommendations and IRS Responses

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1.

TAS RECOMMENDATION #13-1

Assign a dedicated IRS employee to routinely update the military information on irs.gov website.

IRS RESPONSE TO RECOMMENDATION: There is a broad range of topics on IRS.gov and each is assigned a specific functional owner and subject matter expert. These individuals are responsible for performing regular content reviews and updates, as needed. They review user data analytics and reprioritize the content on the main landing page for members of the military (Tax Information for Members of the Military) several times each year, based on seasonal needs. For example, the IRS prioritizes VITA and Free File services at the beginning of the filing season and provides links to filing for an extension during the latter part of the filing season. Our IRS website content team includes veterans, and we also work with the Department of Defense to review and revise content. In situations where we identify potentially incorrect or out of date information, we quickly partner with stakeholders to rectify the guidance provided. We appreciate the National Taxpayer Advocate for identifying a section on the web for Soldiers & Sailors Civil Relief Act (SSCRA) that unfortunately had not yet been updated. Based on feedback contained in your report, we have updated the content on the following web pages: Retirement Plans FAQs Regarding USERRA and SSCRA, Miscellaneous Provisions — Combat Zone Service, and Military Family Tax Benefits.

CORRECTIVE ACTION: N/A

TAS RESPONSE: The National Taxpayer Advocate appreciates the IRS’s acknowledgement that the identified information for military service members on IRS.gov was out-of-date or inaccurate. We are pleased that in response to the National Taxpayer Advocate’s recommendation, the IRS has corrected its online content. The National Taxpayer Advocate applauds the IRS’s renewed efforts to assign a specific functional owner and subject matter expert to perform regular content reviews and updates to military taxpayer information, as needed — actions that have not in recent years been taken regarding military tax issues.

ADOPTED, PARTIALLY ADOPTED or NOT ADOPTED: Adopted

OPEN or CLOSED: Closed

DUE DATE FOR ACTION (if left open): N/A

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2.

TAS RECOMMENDATION #13-2

Create a special unit of SPEC staffed with veterans whose responsibilities are to develop and conduct outreach, education, and assistance to current military taxpayers, including National Guard and Reservists, and to those organizations that provide tax assistance to these taxpayers.

IRS RESPONSE TO RECOMMENDATION: ​The IRS’s Stakeholder Partnerships, Education and Communication (SPEC) organization has an employee assigned within each Territory Office to assist military partners with outreach, education, and tax preparation. These employees are IRS certified and qualified to handle military issues.

CORRECTIVE ACTION: N/A

TAS RESPONSE: Although SPEC provides free tax software and limited training for military tax volunteers, there are no SPEC employees who are dedicated solely to assist this vulnerable taxpayer population with the myriad of unique and challenging tax issues they face. Service members have limited options for obtaining assistance with tax filing and must rely primarily on military VITA sites where they can speak with a tax preparer trained in military tax law. Even that option is only available during the tax season. Establishing a specialized unit within SPEC whose role would be to service members and their families is essential to a population that has a very difficult time in reaching an IRS employee over the phone, much less reaching one who is well-versed in the nuances of military tax law. The National Taxpayer Advocate urges the IRS to create a special SPEC unit to provide military service members with tax assistance which would be consistent with recently introduced legislation, entitled “Military Taxpayer Assistance Act.” (H.R. 5479 (2018)).

ADOPTED, PARTIALLY ADOPTED or NOT ADOPTED: Not Adopted

OPEN or CLOSED: Closed

DUE DATE FOR ACTION (if left open): N/A

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3.

TAS RECOMMENDATION #13-3

Allocate ample funding for SPEC to provide face-to-face training for military VITA volunteers in overseas locations.

IRS RESPONSE TO RECOMMENDATION: ​​​The IRS provides annual training support to prepare military volunteers to certify and to prepare accurate tax returns, both virtually and in-person. The SPEC organization has provided face-to-face VITA training to armed forces volunteers at domestic and overseas military installations since 2000.

CORRECTIVE ACTION: N/A

TAS RESPONSE: We are pleased to learn that the IRS has indicated that SPEC VITA trainers will be sent to South Korea in December 2018 to train military tax volunteers for the upcoming tax filing season. We commend the IRS for reinstating in-person face-to-face training in South Korea. As stated in the annual report, for the first time in many years, SPEC decided to forego in-person VITA training in South Korea in 2017, citing personal safety concerns for their employees. Shortly after the publication of our report and after the Olympics were held in Pyeongchang, South Korea, in February 2018, SPEC reported it would send VITA trainers back to South Korea, as it had done for many years.

ADOPTED, PARTIALLY ADOPTED or NOT ADOPTED: Partially Adopted

OPEN or CLOSED: Closed

DUE DATE FOR ACTION (if left open): N/A

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4.

TAS RECOMMENDATION #13-4

Provide a year-round dedicated toll-free telephone line for service members and their families to answer tax law and filing questions, and to resolve their tax account and compliance issues.

IRS RESPONSE TO RECOMMENDATION: ​​

​The IRS is committed to helping all taxpayers resolve their issues as expeditiously as possible. Our telephone assistors are trained to address questions from service members who are currently in, or have been in, a combat zone. Our telephone assistors rely on a suite of resources, including the Servicewide Electronic Research Program, and Internal Revenue Manual (IRM), to specifically address military-related account and tax law issues. For example, IRM Part 5, Collecting Process, covers how to handle balance due inquiries to ensure military personnel are afforded deferred payment opportunities as well as special treatment of penalties and interest. We provide a Special Services telephone line to handle military-related questions. Overall customer satisfaction for our toll-free services was 90% in fiscal year (FY) 2017. The fiscal year 2017 level of service for taxpayers attempting to reach an assistor improved to 77%, versus 53% in FY 2016. Our analysis indicates that approximately 1% of the toll-free calls the IRS receives relate to former or current military taxpayers, and the associated issues identified can be resolved through our normal menu of telephone options.

In addition to our toll-free telephone support, active duty military personnel can take advantage of our suite of online services available 24 hours a day, seven days a week, through IRS.gov. By simply entering the word “military” into the IRS.gov search field, users are provided with information about several topics, including tax law provisions (e.g., taxability of military income, filing extensions, claiming the EITC); free tax filing services such as Free File or VITA; explanations of notices such as Letter 2761C, Request for Combat Zone Service Dates; access to Publication 3, Armed Forces Tax Guide, and Publication 4940, Tax Information for Active Duty Military and Reserve Personnel; and links to other services including self-service applications that allow for handling account issues such as obtaining an installment agreement for a balance due or securing transcripts.;

CORRECTIVE ACTION: N/A

TAS RESPONSE: The National Taxpayer Advocate is pleased that IRS telephone assistors are trained to address questions from service members who are currently in, or have been in, a combat zone. However, the myriad of unique and very complicated tax issues related to deployments in combat zones, direct support areas, and qualified hazardous duty areas require more than a generalist answering the phone lines. In her 2017 Annual Report to Congress, the National Taxpayer Advocate cited the IRS estimate that in FY 2018 less than 40 percent of those who attempted to call the IRS would be able to speak to a live phone assistor. Importantly though, service members and their families cannot be confident the IRS employees on the other end of the line understand their issues. The IRS response does not even begin to address the problem that military taxpayers have when stationed abroad and trying to find answers outside the domestic filing season (January 1– April 15), but within the overseas filing season (January 1–June 15). Additionally, the IRS does not consider the additional six months outside the filing season, during which the IRS does not answer these questions and military taxpayers have few tax resources available to them. Additionally, since 2014, the IRS has limited the scope of questions it answers over the phone. For instance, the IRS has designated questions about transportation and travel expenses of military personnel as well as uniforms as out-of-scope for its Customer Service Representatives using the Interactive Tax Law Assistor when responding to telephone tax law inquiries. Therefore, the IRS has not addressed the issues raised by our recommendation.

ADOPTED, PARTIALLY ADOPTED or NOT ADOPTED: Not Adopted

OPEN or CLOSED: Closed

DUE DATE FOR ACTION (if left open): N/A

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