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MSP #1: ONLINE RECORDS ACCESS

Limited Electronic Access to Taxpayer Records Through an Online Account Makes Problem Resolution Difficult for Taxpayers and Results in Inefficient Tax Administration

TAS Recommendations and IRS Responses

1
1.

TAS RECOMMENDATION #3-1

Provide business taxpayers access to an online account similar to the IRS’s Online Account that is available to individual taxpayers.

IRS RESPONSE TO RECOMMENDATION: The Taxpayer Experience Strategy as laid out in the recent Taxpayer First Act Report to Congress outlines the IRS’s commitment to expanding digital services to businesses as one of its six key areas of focus. The IRS is committed to expanding the secure online accounts currently available for individual taxpayers and making similar online accounts available for businesses and tax professionals. Subject to funding limitations and other resource constraints, the IRS anticipates beginning to conduct taxpayer research in FY 2021, with authorization work and design to begin in subsequent years, again, subject to funding.

CORRECTIVE ACTION:IRS Agrees with TAS Recommendation but Cannot Implement It Currently Due to Funding Limitations.

The Taxpayer Experience Strategy as laid out in the recent Taxpayer First Act Report to Congress outlines the IRS’s commitment to expanding digital services to businesses as one of its six key areas of focus. The IRS is committed to expanding the secure online accounts currently available for individual taxpayers and making similar online accounts available for businesses and tax professionals. Subject to funding limitations and other resource constraints, the IRS anticipates beginning to conduct taxpayer research in FY 2021, with authorization work and design to begin in subsequent years, again, subject to funding.

TAS is monitoring this recommendation.

TAS RESPONSE: TAS is pleased the IRS is moving forward with the actions necessary to provide Online Account services to business taxpayers. Because these taxpayers have similar needs to individual taxpayers when it comes to accessing information and conducting their business with the IRS online, the IRS should prioritize and expedite these efforts.

Update: There is a recommendation similar to this one in the 2021 Online Accounts MSP. Recommendation 6-2 is Prioritize and expedite efforts to deliver BOLA to business taxpayers by the end of FY 2023. We will update this recommendation based on IRS’s response to the 2021 recommendation. Their responses are due to TAS toward the end of April 2022.

Update: The IRS has prioritized business online account (BOLA) development by the end of FY23. However, this development is now entirely dependent on the organization’s ability to secure appropriate funding and IT development resources in FY22. The IRS is very dedicated to developing an online account for business taxpayers.

Assuming funding and IT resources are available, OLS is committed to developing BOLA with an initial set of product features that will allow business taxpayers to make, schedule, cancel and view tax payments online.

TAS is monitoring this recommendation.

ADOPTED, PARTIALLY ADOPTED or NOT ADOPTED: Adopted

OPEN or CLOSED: Open

DUE DATE FOR ACTION (if left open): 10/31/2023, TAS is monitoring this recommendation.

2
2.

TAS RECOMMENDATION #3-2

Prioritize posting to the Online Account notices that provide the taxpayer with key statutory or administrative rights, a deadline for action, or notice of a potential intrusive enforcement action, such as levy.

IRS RESPONSE TO RECOMMENDATION: The Taxpayer Experience Strategy as laid out in the recent Taxpayer First Act Report to Congress outlines the IRS’s commitment to expanding digital services, including the delivery of notices. Subject to funding constraints, the IRS will seek to prioritize conversion of notices and will incorporate the criteria recommended by TAS into the prioritization as possible given other resource demands.

CORRECTIVE ACTION:The Taxpayer Experience Strategy as laid out in the recent Taxpayer First Act Report to Congress outlines the IRS’s commitment to expanding digital services, including the delivery of notices. Subject to funding constraints, the IRS will seek to prioritize conversion of notices and will incorporate the criteria recommended by TAS into the prioritization as possible given other resource demands.

If funding is received, the prioritization of additional notices (beyond the 11 already scheduled) is planned to occur in FY 2022.

TAS RESPONSE: Although there are both funding and technological barriers to placing certain notices in the Online Account, TAS is looking forward to working with the IRS to identify some of the most fundamental notices in terms of taxpayer rights and prioritize these for posting. Even if there are some statutory notices and other notices with deadlines that cannot be posted at this time, TAS expects to target notices that will help taxpayers exercise their rights and meet important deadlines.

ADOPTED, PARTIALLY ADOPTED or NOT ADOPTED: Partially Adopted

OPEN or CLOSED: Open

DUE DATE FOR ACTION (if left open): 9/30/2023

3
3.

TAS RECOMMENDATION #3-3

Develop a timeline for when all remaining notices used by the IRS, outside the 11 notices already scheduled, will be available to be viewed within taxpayers’ Online Accounts.

IRS RESPONSE TO RECOMMENDATION: The IRS intends to convert as many of the remaining notices to a digital format as possible given funding levels and other resource demands. Consistent with the 21st Century Integrated Digital Experience Act (IDEA) legislation, the IRS plans to conduct research to gain insights into taxpayer needs that will inform a more robust prioritization plan for digital notice delivery. Given uncertain resources, legislative demands, and potential changes to the inventory of notices utilized for tax administration, the IRS cannot commit to a timeline for all remaining notices at this time.

CORRECTIVE ACTION: IRS Agrees with TAS Recommendation but Cannot Implement It Currently Due to Funding Limitations.

The IRS intends to convert as many of the remaining notices to a digital format as possible given funding levels and other resource demands. Consistent with the 21st Century Integrated Digital Experience Act (IDEA) legislation, the IRS plans to conduct research to gain insights into taxpayer needs that will inform a more robust prioritization plan for digital notice delivery. Given uncertain resources, legislative demands, and potential changes to the inventory of notices utilized for tax administration, the IRS cannot commit to a timeline for all remaining notices at this time.

TAS is monitoring this recommendation.

TAS RESPONSE: The IRS should work toward prioritizing its goal of placing all taxpayer notices in the Online Account, similar to the California Franchise Tax Board. Including only some notices online may confuse taxpayers, causing them to miss paper notices in the mail that are not in the Online Account. Although funding may dictate the timeline, the IRS should be making plans to place all notices online.

ADOPTED, PARTIALLY ADOPTED or NOT ADOPTED: Adopted

OPEN or CLOSED: Open

DUE DATE FOR ACTION (if left open): 9/30/2023, TAS is monitoring this recommendation.

4
4.

TAS RECOMMENDATION #3-4

Provide access to all self-assistance online applications through the Online Account.

IRS RESPONSE TO RECOMMENDATION: Not all existing self-assistance online applications require the same level of registration or authentication that is necessary to gain access to the individual Online Account. Preserving access to the greatest number of taxpayers is a key IRS consideration in determining which tools should be incorporated into a robust account experience. It would be unnecessarily burdensome for taxpayers to satisfy a higher level of authentication to access all our applications. The integration of existing features within a consolidated account must also be balanced against our ability to develop new features that will improve the taxpayer experience.

CORRECTIVE ACTION: N/A

TAS RESPONSE: TAS’s recommendation is not to remove all freestanding IRS online applications and make them only available in the Online Account. Instead, the recommendation asks the IRS to make them also available within the Online Account, so taxpayers can have a one-stop shop for all their IRS needs. Certainly, we agree with the IRS that requiring additional authentication where it is not needed would burden taxpayers.

ADOPTED, PARTIALLY ADOPTED or NOT ADOPTED: Not Adopted

OPEN or CLOSED: Closed

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

5
5.

TAS RECOMMENDATION #3-5

Update and consolidate Online Account information to reflect information from all other IRS online applications.

IRS RESPONSE TO RECOMMENDATION: The IRS has a growing list of taxpayer needs to prioritize based on funding. The IRS agrees with the need for a migration plan for qualified existing self-service applications to a consolidated account experience where incorporating them will improve the taxpayer experience. However, funding limitations necessitate such a migration plan to be prioritized against the need to build new services that do not otherwise exist online. If funded, IRS agrees that consolidation of features would improve the taxpayer experience. However, the IRS does not agree that all self-assistance online applications should be accessed through Online Account. For example, today the Tax Withholding Estimator is accessible to anyone and does not require registration. Imposing registration requirements will limit the number of taxpayers able to access this self-assistance tool. Conversely, if the same functionality can be used without such protections, rebuilding the service behind such protections could be duplicative and reduce the pace at which other services can be brought online.

CORRECTIVE ACTION: IRS Agrees with TAS Recommendation but Cannot Implement It Currently Due to Funding Limitations.

The IRS has a growing list of taxpayer needs to prioritize based on funding. The IRS agrees with the need for a migration plan for qualified existing self-service applications to a consolidated account experience where incorporating them will improve the taxpayer experience. However, funding limitations necessitate such a migration plan to be prioritized against the need to build new services that do not otherwise exist online. If funded, IRS agrees that consolidation of features would improve the taxpayer experience.

TAS is monitoring this recommendation.

TAS RESPONSE: The recommendation is not asking for the applications themselves to be available within the Online Account (although the previous recommendation does ask for this), but instead for valuable taxpayer-specific data to be incorporated. For example, the information about when a refund is sent to the specific taxpayer should be incorporated into the Online Account so the taxpayer does not have to view a transcript that may not yet reflect this information. The IRS already made progress in this area earlier this year by placing Economic Impact Payment information within the Online Account, which was previously only available through the freestanding application.

ADOPTED, PARTIALLY ADOPTED OR NOT ADOPTED: Partially Adopted

OPEN or CLOSED: Open

DUE DATE FOR ACTION (if left open): 9/30/2023, TAS is monitoring this recommendation.

6
6.

TAS RECOMMENDATION #3-6

Integrate secure messaging so that taxpayers can initiate and view messages and upload and download documents to and from the IRS within their Online Accounts.

IRS RESPONSE TO RECOMMENDATION: The IRS plans to integrate access to secure messaging in Online Account in FY 2023; however, this is not currently funded.

CORRECTIVE ACTION: IRS Agrees with TAS Recommendation but Cannot Implement It Currently Due to Funding Limitations.

The IRS plans to integrate access to secure messaging in Online Account in FY 2023; however, this is not currently funded.

TAS is monitoring this recommendation.

TAS RESPONSE: While TAS acknowledges the funding restrictions, placing secure messaging within the Online Account should be prioritized. Allowing taxpayers to view a notice, ask questions, send documents, and make requests, all within a single visit to the Online Account, should encourage taxpayer participation in the tax system and expedite the exam and collection processes.

ADOPTED, PARTIALLY ADOPTED OR NOT ADOPTED: Adopted

OPEN or CLOSED: Open

DUE DATE FOR ACTION (if left open): 

7
7.

TAS RECOMMENDATION #3-7

Place taxpayer-specific alert banners on the main dashboard of taxpayers’ Online Accounts to provide information regarding their status of their cases and highlight important deadlines, such as the due date for providing documentation in an examination, the assignment of a balance due case to a Revenue Officer, or the deadline to request a CDP hearing.

IRS RESPONSE TO RECOMMENDATION: The IRS would like to evolve the use of alert banners for a more personalized experience; however, this feature is not currently funded.

CORRECTIVE ACTION: N/A

TAS RESPONSE: Although there is not funding at this time, personalization should be revisited when the IRS receives additional funding for the Online Account. This feature may help taxpayers meet deadlines and take advantage of rights that might otherwise lapse if taxpayers are mot reminded of them.

ADOPTED, PARTIALLY ADOPTED OR NOT ADOPTED: Adopted

OPEN or CLOSED: Closed

DUE DATE FOR ACTION (if left open):  

8
8.

TAS RECOMMENDATION #3-8

Allow taxpayers to add, change, or remove authorized representatives through the Online Account.

IRS RESPONSE TO RECOMMENDATION: The IRS will add these features to Online Account this summer along with the launch of Tax Professional Accounts.

CORRECTIVE ACTION: The IRS will add these features to Online Account this summer along with the launch of Tax Professional Accounts.

TAS RESPONSE: Allowing taxpayers to change their authorized representatives within the Online Account supports taxpayers’ right to retain representation. The feature will reduce burden and mitigate delays caused by unopened or unprocessed mail.

ADOPTED, PARTIALLY ADOPTED OR NOT ADOPTED: Adopted

OPEN or CLOSED: Closed

DUE DATE FOR ACTION (if left open):

9
9.

TAS RECOMMENDATION #3-9

Allow taxpayers to give authorized representatives access to Online Account records for the authorized tax years.

IRS RESPONSE TO RECOMMENDATION: In future years, IRS plans to add features to the tax professional online account, including a link to the transcript delivery system where tax professionals could both establish authorization and then access records for a particular taxpayer, tax type, and tax year. Currently, tax professionals may use eServices to access transcripts; however, they must first complete the authorization via fax or mail.

CORRECTIVE ACTION: N/A

TAS RESPONSE: For taxpayers who are represented and choose to interact with the IRS exclusively through an authorized representative, the Online Account does not provide much benefit. It is essential that representatives have a way to access the taxpayer’s information in the Online Account, limited to only the information the taxpayer has authorized them to access.

ADOPTED, PARTIALLY ADOPTED OR NOT ADOPTED: Adopted

OPEN or CLOSED: Closed

DUE DATE FOR ACTION (if left open): 

10
10.

TAS RECOMMENDATION #3-10

Allow taxpayers to update their address and other contact information through the Online Account.

IRS RESPONSE TO RECOMMENDATION: The IRS is currently planning for these features to be implemented in FY 2022 in accordance with the IT Modernization Plan, depending on funding and other resource constraints.

CORRECTIVE ACTION: IRS Agrees with TAS Recommendation but Cannot Implement It Currently Due to Funding Limitations.

The IRS is currently planning for these features to be implemented in FY 2022 in accordance with the IT Modernization Plan, depending on funding and other resource constraints.

TAS is monitoring this recommendation.

TAS RESPONSE: Allowing taxpayers to change their address or contact information online is a service that taxpayers already expect with respect to other institutions such as banks. This change will bring the IRS closer to the world-class service it is striving to provide. This new capability should reduce undelivered mail, saving the IRS time and resources and increasing the chances that taxpayers receive their notices and correspondence.

ADOPTED, PARTIALLY ADOPTED OR NOT ADOPTED: Adopted

OPEN or CLOSED: Open

DUE DATE FOR ACTION (if left open): 12/31/2022, TAS is monitoring this recommendation.

11
11.

TAS RECOMMENDATION #3-11

Allow taxpayers to make certain requests and file certain forms through the Online Account, such as a CDP request, a penalty abatement request, or a tentative carryback application for refund where e-file is not otherwise available.

IRS RESPONSE TO RECOMMENDATION: This capability could utilize planned integration of, and access to, secure messaging in Online Account, which is planned for FY 2023. However, this is not currently funded.

CORRECTIVE ACTION: IRS Agrees with TAS Recommendation but Cannot Implement It Currently Due to Funding Limitations.

This capability could utilize planned integration of, and access to, secure messaging in Online Account, which is planned for FY 2023. However, this is not currently funded.

TAS is monitoring this recommendation.

TAS RESPONSE: Allowing taxpayers to make certain requests and file certain documents online will increase participation in the tax system and mitigate problems caused by unopened and unprocessed mail. TAS looks forward to the IRS making this capability available, even if it is limited to only several types of requests and documents initially.

ADOPTED, PARTIALLY ADOPTED OR NOT ADOPTED: Adopted

OPEN or CLOSED: Open

DUE DATE FOR ACTION (if left open): 12/31/2023, TAS is monitoring this recommendation.

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