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MLI #8: Itemized Deductions Reported on Schedule A (Form 1040)

TAS Recommendations and IRS Responses



Evaluate the existing communication strategy, including the IRS website, guidance, and publications, to taxpayers, preparers, and practitioners to determine how to increase awareness about itemized deductions, including recordkeeping requirements.  Then based on the findings, conduct outreach within the next two fiscal years to better educate taxpayers.

IRS RESPONSE TO RECOMMENDATION: The IRS has included itemized deductions and recordkeeping requirements consistently in our outreach efforts and is constantly evaluating information, feedback, and other data to build campaigns to educate taxpayers. Therefore, we agree to implement Recommendation MLI #8-1 in part.

The IRS, including through our tax organization partners, regularly provides educational opportunities to inform taxpayers and practitioners about itemized deductions, along with other audit issue topics, and connects with the tax preparer community through virtual presentations, meetings, and cascading media information. In addition, through our partnerships with other non-tax organizations and corporations, the IRS has shared information to help the people they serve, members and employees in meeting their filing obligations, including itemized deductions changes and recordkeeping.
The IRS Nationwide Tax Forums have addressed the changes to itemized deductions included in the Tax Cuts and Jobs Act (TCJA) as well as recordkeeping. In 2020, the Tax Forums presented the following seminars on preparer audit issues: “IRS Key Enforcement Issues,” “Due Diligence in Practice before the IRS: Record-Keeping,” and “Representing the Taxpayer without Records, Reconstructing Income and Expenses.” Recordkeeping and documentation of itemized deductions are also addressed in the 2021 annual federal tax refresher course that is part of the Return Preparer Office’s Annual Filing Season Program (AFSP). Approximately 33,000 return preparers take the federal tax refresher course each year.

The IRS posts general communications about recordkeeping and Schedule A itemized deductions on our website. In addition, the Interactive Tax Assistant’s Deduction section for taxpayers currently includes a wealth of information on the topic. Information is also included through tax forms and publications. Our news media and social media messages include information on itemized deductions and recordkeeping. For example, we posted several tweets during the Get Ready for Filing Season campaign that focused on deductions.

The IRS also regularly conducts outreach on new tax legislation, most recently for the individual extenders and the Taxpayer Certainty and Disaster Relief Act of 2020 and how such legislation affects deductions for which taxpayers may be eligible.
As the National Taxpayer Advocate’s report acknowledges, it is reasonable to predict that litigation in this area will diminish now that fewer taxpayers itemize deductions under the TCJA. Nonetheless, the IRS will continue to analyze data, update, and create specialized messages, presentations, and campaigns to address itemized deductions and other recordkeeping requirements, as appropriate.


TAS RESPONSE: It is encouraging that the IRS agrees to implement this recommendation in part, and we look forward to working with the IRS to better educate taxpayers, preparers, and practitioners to increase awareness about itemized deductions, including recordkeeping requirements.


OPEN or CLOSED: Closed

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