AICPA recommends top three goals for IRS Oversight Board.

The AICPA recommended that the top three tax administration goals on which the IRS Oversight Board should concentrate in 2005 are improving taxpayer service, enhancing enforcement of the tax law, and modernizing the IRS through its people, processes and technology. The AICPA made specific suggestions about improvements that could be made in each area (to read the full comment letter, visit www.cpa2biz.com/tax).

In its letter, the AICPA said the IRS will continue to have difficulty realizing its strategic priorities unless adequate budgetary funding is provided for fiscal year 2005 and beyond and commended the IRS Oversight Board for providing vigorous support for full budgetary funding for the IRS. The Institute also said it will continue its long-standing advocacy for funding levels that would allow the IRS to efficiently and effectively administer the tax laws and collect taxes.

Regarding improvements in taxpayer service, the AICPA encouraged the Oversight Board to continue its strong support of the IRS in implementing initiatives that help promote effective communications with the IRS Oversight Board, Congress and stakeholders (such as the AICPA). Strong support for timely, clear and effectively written guidance was also emphasized, saying IRS guidance should promote a more uniform understanding and consistent application of the tax laws. The AICPA also supports IRS initiatives to increase the amount of published guidance, including more revenue rulings and revenue procedures, and making such guidance more timely.

Another point the AICPA made is that the Oversight Board should continue supporting efforts to enhance tax law enforcement, particularly in light of the substantial decline in the number of income tax examinations in recent years. Much of this decline can be attributed to fewer IRS compliance personnel and the increased workloads resulting from the IRS Restructuring and Reform Act of 1998. The AICPA also commended the IRS and Treasury for clearly addressing the issue of professional responsibility standards for tax professionals in general, and particularly with respect to the eradication of abusive tax transactions.

Lastly, the AICPA strongly supported the Oversight Board's continuing emphasis on modernization. Saying modernization must begin with a vigorous commitment to investing in the IRS's current employees and new hires, the AICPA noted that retirements of mid-level and rank-and-file employees are affecting the IRS's ability to implement the reorganization and improve employees' productivity. Replacing retirees with qualified staff and compensating for the loss of "institutional memory" will be a major challenge and, therefore, must be a major priority for the immediate future, the Institute said.