TAX CHANGES TARGET SCOFFLAWS.

Byline: EVA ROSENBERG Guest Column

This summer, we lost all chance for tax simplification.

The latest tax changes in the Taxpayer Relief Act of 1997, the Balanced Budget Act of 1997 and the Taxpayer Browsing Protection Act will provide administrative challenges to Steven A. Jensen, the Internal Revenue Service's director for the Los Angeles District.

Jensen has extensive background in audits and estates. The strength of Richard Auby, his assistant district director, lies in the collections area. Together, their goal is to bring the Los Angeles District into compliance.

Compliance. What does compliance mean to taxpayers? For the majority of the population who file tax returns and pay their balances due . . . not a thing.

But it could be the end of the line for freeloaders: those bragging about picking up a ``little cash'' here and there; people who don't file tax returns at all; those whose earnings are ``off the books.''

Jensen is surprised that more taxpayers don't get angry having to foot the bill for these tax outlaws.

Peace. Jensen feels strongly that if everyone picked up their fair share of the tax burden, the rest of us could pay substantially less.

Sure, he's heard the argument that you don't like the way Uncle Sam spends your money, so why chip in? Do you enjoy driving along an interstate highway? See those streetlights along your thoroughfare? Did you ever visit Yosemite or the Santa Monica Mountains?

Surely, you like getting money from your customers, clients and patrons who get paychecks from the federal government or government contractors? Our taxes don't just pay for wars. They pay for peace, too.

Tax protesters. A particular target for today's IRS. Taking full advantage of the benefits provided by society, they are not willing to share in the costs and responsibilities. Jensen considers this a rather lopsided view.

When asked if their claims have ever stood up in a court of law, Jensen paused and thought, ``No. Not that I ever heard.'' And it's his job to know.

What about all those cases they're always citing that support the position that taxes are illegal? ``Usually the cases have no relationship to the point. Their citations result from searching legal databases for particular words. But the decisions in those cases don't support the tax protesters' positions. These protesters count on bombarding us with cases, thinking we'll never read them all. We do.''

Tax outlaws. It's harder to hide from the system. The cash economy is disappearing. As companies computerize their records and cash registers, hiding income becomes more difficult.

Despite the disdain toward the IRS' outdated computers, their matching programs spotlight independent contractors and free-lancers who are not filing tax returns.

Not surprisingly, when faced with the prospect of losing a deduction, business owners are issuing 1099s to workers and contractors, even after promising not to report them.

Targets. Jensen notes that here in the Los Angeles District, his employees can run programs to look for specific kinds of taxpayers and patterns. Although the Tax Compliance Management Program, or TCMP, audits are temporarily on hold, the District Director hints that they have better ways to target their audits.

For instance, they could search for all taxpayers who:

a) File a Schedule C.

b) Have losses.

c) Have W-2 income that absorbs those losses.

d) Have generated these losses for three years.

e) Have a specific ZIP code.

Or, for those people who enjoy the skills of a tax professional who uses the IRS' national averages to invent deductions - the local IRS computer can do a search on all tax returns:

a) Showing deductions within a slight margin of national averages.

b) Within a 10-mile radius of, say, Woodland Hills.

c) With some preparer's Social Security number or employer identification number.

He does not say that they will do these specific searches, just that they could.

Fairness. Is this powerful chief unreasonable? He agrees that examiners should not be wasting your time.

Repeated audits on taxpayers when previous audits showed no balance due should not be done. Jensen wants to run his IRS like a business. He wants ``profits,'' not spinning wheels.

Courtesy. Jensen also agrees that his employees must treat taxpayers with courtesy and respect.

When visiting your place of business, they must show you proper government identification, not just a business card.

They must follow IRS procedures and guidelines. They must provide you with an opportunity to respond and correct the problem before making seizures or filing levies.

What, me worry? Most taxpayers never get bothered by the IRS. However, many people get notices about minor (or major) errors turned up by matching programs or math checks of their returns. Respond to each notice right away and you can usually forget it. Ignore the IRS - trigger levies and garnishments.

Communicate. Knowing the unpopularity of the office, Jensen has expressed an interest in feedback from the public. Let him know about an IRS employee who does a good job.

If you have constructive suggestions, comments or criticisms, send them to rickygrayearthlink.net or mail them to Eva Rosenberg, P.O. Box 280549, Northridge, CA 91328. The information will be forwarded to Jensen on a monthly basis. (Due to volume, personal replies cannot be promised.)

FOR MORE HELPL: Useful IRS phone numbers:

Speakers: [phone].

VITA (Volunteer Income Tax Assistance): [phone].

Tax Counseling for the Elderly [phone].

TeleTax (recorded information - 140 topics): [phone].

Forms and Publications: [phone].

Missing Refunds: [phone].

IRS Tax Fax (Get Forms by Fax): [phone].

General IRS Tax Assistance Number: [phone].

Web sites

Internal Revenue Service.

http://www.irs.ustreas.gov

Enrolled Agents - EAs and tax specialists www.naea.org/

Accounting Associations - CPAs

www.accountingnet.com/association.html

American Bar Association - Attorneys http://www.abanet.org/

Looming deadlines

Sept. 15 - Third estimated tax payments to the IRS and Franchise Tax Boards.

Oct. 15 - Last date to file 1996 extended personal income tax returns.

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