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Peterson alerts tax division to coming IRS changes.

Shirley Peterson, Internal Revenue Service commissioner, in addressing the American Institute of CPAs spring tax division meeting in Washington, told the gathering the IRS is entering a period Of fundamental change. "We must," she said, "begin to view taxpayers as our customers."

The IRS has done business the same way for 40 years, and Peterson says it must change its technology, organization and structure. "It no longer makes sense to organize the IRS along geographical lines. We realize we can do our job better if we look at the organization in a functional way."

Taking advantage of her first opportunity to speak to the AICPA since she took office in February, Peterson outlined three goals she set for her administration:

* Improve voluntary compliance with the tax laws.

* Reduce the burden on taxpayers.

* Improve productivity and customer satisfaction.

Peterson also discussed two elements--outreach and enforcement-of the IRS's new Compliance 2000 program, which seeks to make tax administration and compliance significantly easier for taxpayers and the IRS.

Increased outreach is needed, Peterson says, because "some noncompliance is unintentional and caused by complexity in the tax laws." For example, she said, last year the IRS enforced a payroll tax penalty on one-third of U.S. employers. "I don't believe one-third of U.S. employers willingly violated the laws-the laws were too complex."

Because some noncompliance is intentional, Peterson believes improved enforcement is necessary. She also believes the IRS must increase the cost of noncompliance. She told the assembled AICPA tax practitioners, "The only reason to have penalties is to increase compliance. Penalties are not designed to raise revenue or to punish taxpayers."

Peterson says the IRS will not turn away from its goal of revolutionizing the tax system. The Compliance 2000 battle will be waged with increased staff, improved outreach and aggressive examination and criminal prosecution. Peterson concluded by emphasizing that the Compliance 2000 philosophy must permeate all IRS programs and by saying, "We're going to get there."
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Title Annotation:Shirley Peterson addressing AICPA
Publication:Journal of Accountancy
Article Type:Brief Article
Date:Sep 1, 1992
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