November 2, 2023

IRS Enhances Services, Targets Tax Evasion, and Modernizes Technology

The Internal Revenue Service (IRS) is embarking on a transformative journey, unveiling innovative business tax accounts and enhancing its online tax professional services. These initiatives are underscored by a substantial boost in the recruitment of skilled accountants, part of a concerted effort to combat tax evasion within the domain of large corporations and high-net-worth individuals.

IRS Commission Danny Werfel stated that “The business tax account will allow businesses to check their tax payment history, make payments, view notices, authorize powers of attorney and conduct other business with the IRS.  The first phase of this account will allow unincorporated sole proprietors who have an active Employer Identification Number to set up a business tax account where they can view their business profile and manage authorized users. Future improvements will add more features to this account.”

Business Tax Accounts – Revolutionizing Tax Management:
The IRS introduces a groundbreaking solution – the Business Tax Accounts. This forward-looking platform empowers companies of all sizes, offering them the convenience of seamless tax management. These accounts open doors to an array of functionalities, enabling businesses to closely monitor and efficiently handle their tax-related affairs.

Among the features, businesses can easily access their tax payment histories, facilitating transparency and informed financial planning. The platform further simplifies the payment process, allowing for swift and hassle-free transactions. By offering the ability to view notices, it ensures that businesses are promptly aware of any relevant tax-related communication from the IRS. Additionally, the platform streamlines the authorization of powers of attorney, optimizing the representation process.

While currently accessible to unincorporated sole proprietors possessing an active Employer Identification Number (EIN), these accounts are designed for continuous improvement. The IRS plans to roll out additional enhancements, enriching the platform with even more advanced features and capabilities in the foreseeable future.

This monumental step by the IRS reflects its unwavering commitment to providing taxpayers with innovative tools and resources that simplify their tax management processes. It marks a pivotal shift in the way businesses interact with the IRS, fostering transparency, efficiency, and compliance. As the business tax accounts continue to evolve, they promise to be a vital asset for organizations navigating the complex landscape of taxation.

With the IRS’s forward-looking approach and its dedication to enhancing services, the future of tax management is set to become more accessible and uncomplicated for businesses across the nation.

Tax Professional Accounts:
The IRS is enhancing its online tax professional accounts, enabling tax professionals to manage active client authorizations efficiently. This includes features such as viewing clients’ tax information, including balance due amounts, and the ability to withdraw from active authorizations in real time.

Crackdown on Tax Evasion:
To address tax evasion issues, the IRS is focusing on U.S. subsidiaries of foreign corporations that distribute goods in the U.S. These entities often use transfer pricing to underreport profits. The IRS is sending compliance alerts to around 150 U.S. subsidiaries, reminding them of their U.S. tax obligations and encouraging self-correction.

High-Income Taxpayer Pursuit:
The IRS is intensifying efforts to address noncompliance among high-income individuals. Their focus is on taxpayers with over $1 million in income and more than $250,000 in recognized tax debt. Notable achievements include collecting $122 million from 1,600 high-end collection cases, demonstrating their commitment to pursuing tax debts effectively.

Technological Advancements:
The IRS is modernizing its technology to enhance taxpayer services. Online platforms now offer features like the ability to respond to notices online, submit mobile-friendly forms, and validate bank accounts for efficient payments. The IRS is also expanding document scanning capabilities and embracing digitalization.

In-Person Taxpayer Assistance:
Additional funding has enabled the IRS to open more in-person Taxpayer Assistance Centers, particularly in underserved and rural communities. These centers have seen an 18% increase in taxpayers served in fiscal year 2023. Community assistance visits have also been organized to reach taxpayers in remote areas.

A Plea for Continued Funding:
Despite these achievements, the IRS is concerned about potential funding cuts due to budget uncertainty. The agency emphasizes the importance of consistent, reliable funding to sustain improvements and ensure fairness in the tax system.

In conclusion, the IRS is making significant strides in enhancing services, targeting tax evasion, and modernizing technology to provide better support to taxpayers and enforce tax compliance. Continued funding is crucial to maintaining this momentum and achieving long-term goals.