IRS Issues 'Progress Report' on Tax-Exempt Improvements

By Ken Berry 
 
While ill will over the Tea Party scandal continues to fester, the IRS says it's improving its procedures for reviewing tax-exempt applications. On September 24, the nation's tax collection agency released a new table showing the progress it has made in following recommendations outlined by the Treasury Inspector General for Tax Administration (TIGTA).
 
The scandal first began brewing back in May when it was revealed that IRS staffers had exerted extra pressure on certain conservative groups, including those with Tea Party affiliations, that had applied for tax-exempt status. Amidst a lot of finger pointing, IRS officials admitted that conservative political groups were wrongly singled out. 
  

Tea Party Scandal

Follow AccountingWEB's coverage of the Tea Party scandal here.

TIGTA then issued a report on the IRS activities, concluding that the agency had used inappropriate criteria for identifying reviews of applications by organizations. In the report, TIGTA offered several recommendations to the IRS for ensuring fair and reasonable standards. Acting IRS Commissioner Daniel Werfel responded promptly through a report of his own in June, outlining steps to fix the problems and improve the overall operations.
 
The new table released by the IRS features the following actions:
  • The IRS is revising the internal manual for processing tax-exempt applications. It has incorporated comments from the Taxpayer Advocate and is training staff members on how to apply appropriate screening criteria.
     
  • To facilitate a better means of choosing reviews by specialists, the IRS is conducting training on new procedures. Senior managers are being reminded of all new procedures and policies. Also, extra training sessions have been added to the 2014 schedule.
     
  • The IRS has developed a process for its Determinations Unit to formally request assistance from the Technical Unit and the Guidance Unit. 
     
  • The IRS Emerging Issue Committee will continue to develop guidance for specialists on processing requests for tax-exempt status by groups involving potentially significant political campaign intervention.
     
  • An initial draft has been developed for a training course to be held before each election cycle. This will include an examination of what constitutes political campaign intervention, as opposed to general advocacy, and how to initiate follow-up activities for organizations that may conduct future activities that could jeopardize their tax-exempt status.
     
  • Finally, all eligible organizations in the initial backlog have been contacted. The IRS has offered those organizations the opportunity for expedited processing. The report says 70 percent of cases in the backlog have been closed, including seventy-two that have received favorable determination letters.
The table provided by the IRS indicates that all actions are either completed or are "green" status (i.e., on schedule). For more details on the IRS's progress in this area, go to the IRS website
 
Related articles:
 

You may like these other stories...

Legislation coming out of Washington just might reduce homeowners' burden for disaster insurance. It's a topic very much on everyone's minds since the mudslide in Oso, Washington. The loss of human life was...
Divorce is hard, and the IRS isn't going to make it any easier. The IRS generally says "no" to tax deductions that might ease the pain of divorce. In certain circumstances, however, you might be able to salvage...
IRS chief: New rule on the way for tax-exempt groupsIRS Commissioner John Koskinen told the USA Today on Monday that the agency will likely rewrite a proposed rule regulating the political activities of nonprofit groups to...

Upcoming CPE Webinars

Apr 17
In this exciting presentation Excel expert David H. Ringstrom, CPA shares tricks that you can use with pivot tables every day. Remember, either you work Excel, or it works you!
Apr 22
Is everyone at your organization meeting your client service expectations? Let client service expert, Kristen Rampe, CPA help you establish a reputation of top-tier service in every facet of your firm during this one hour webinar.
Apr 24
In this session Excel expert David Ringstrom, CPA introduces you to a powerful but underutilized macro feature in Excel.
Apr 25
This material focuses on the principles of accounting for non-profit organizations' revenues. It will include discussions of revenue recognition for cash and non-cash contributions as well as other revenues commonly received by non-profit organizations.