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Adoption tax credit: GAO says the IRS can reduce audits and refund delays.

The Government Accountability Office was recently asked to describe the IRS strategy for ensuring compliance with the adoption credit for the 2011 filing season, assess the IRS related communication with taxpayers and stakeholders, and assess its processing and audit of claims.

The report,, made the following recommendations for the 2012 filing season:

* Instruct appropriate officials to ensure that the communications effort includes state and local adoption officials, and clarifies acceptable documentation for the certification of special needs adoptees.

* Instruct appropriate officials to place the agreements on its website to help taxpayers better understand what constitutes acceptable documentation.

* Instruct appropriate officials to determine whether requesting documentation in cases where no documentation is provided before initiating an audit would reduce the number of audits without significantly delaying refunds and, if so, implement such a strategy for the 2012 filing season.
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Publication:California CPA
Date:Jan 1, 2012
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