The Internal Revenue Service’s (IRS’s) Office of Taxpayer Burden Reduction is soliciting recommendations from members of the public on ways to reduce taxpayer burden. The Office is also coordinating several initiatives designed to help ease taxpayers’ burden in complying with federal agencies.
The Office of Taxpayer Burden Reduction encourages tax professionals, business owners and others to submit their proposals for ways to reduce burden by using referral Form 13285A, Reducing Burden of America’s Taxpayers. Taxpayer burden is defined as the time and money taxpayers spend to comply with their federal tax obligations. Form 13285A requests a specific description of the problem, as well as a description of the proposed solution and the type of taxpayers or businesses that are affected.
Established in early 2002, the Office of Taxpayer Burden Reduction provides direction and leadership for burden reduction efforts, such as the simplification of forms and publications and streamlining of internal procedures. The Office’s project managers work with specialists from all divisions and functions of the IRS and consult with outside experts, such as tax professionals, business groups and state and federal agencies. This year, initiatives coordinated through the Office include:
- AMT Assistant for Individual Taxpayers The AMT Assistant is a new online tool that helps individual taxpayers determine whether they are potentially subject to the alternative minimum tax (AMT).
- Streamlined Extension of Time to File Taxpayers are able to request an automatic, six-month tax-filing extension for most common individual and business returns. The new regulations make this option available to most non-corporate business taxpayers, including partnerships and trusts.
- Simplified Tax Filing Requirements for Small Employers with Form 944 Beginning January 1, 2006, certain employment tax filers are able to file the new Form 944, Employer’s Annual Federal Tax Return, once a year rather than filing Form 941, Employer’s Quarterly Federal Tax Return, four times a year. The first Form 944 is due January 31, 2007.
- Revised Schedule K-1 for Partnerships, S-corporations and Trusts The IRS revised Form 1041 Schedule K-1 for this year’s filing season. The schedule has been simplified to reduce errors and the burden associated with preparation and filing requirements. Schedule K-1 for Forms 1065 and 1120S were revised last year. More information is available on the new K-1 for trusts, as well as the revised K-1s for partnerships and S-corporations.
The IRS often partners with members of the public, tax professionals, businesses and others to obtain input on a variety of issues relating to tax administration. Partnership may take the form of formal committees and programs, or less formal activities, such as requests for comments on proposed guidance. Other partnership activities currently include:
- Internal Revenue Service Advisory Council (IRSAC) – The IRSAC advises the IRS on issues that have a substantive effect on federal tax administration. Membership includes representation from the taxpaying public, the tax professional community, small and large businesses, state tax administration and the payroll community.
- Information Reporting Program Advisory Committee (IRPAC) – The IRPAC works with the Commissioner and other IRS executives to provide recommendations on a wide range of information reporting administration issues. Membership includes representation from the taxpaying public, the tax professional community, small and large businesses, state tax administration and the payroll community.
- Nationwide Tax Forums – The three-day forums, which the IRS presents jointly with several professional associations, offer tax professionals the latest word from the IRS tax law, compliance and ethics, as well as the opportunity to interact with IRS executives and specialists.
- Industry Issue Resolution (IIR) Program – The IIR Program resolves frequently disputed or burdensome tax issues affecting large numbers of taxpayers. The IRS solicits suggestions for issues for the program from business taxpayers and associations.