IRS funding and preparer oversight are top issues for IRS Advisory Council

This year’s report of the IRS Advisory Council includes recommendations on 37 issues covering a broad range of topics, among the most important of which are IRS funding and oversight of preparers.

The top general report issues also include IRS Strategic Operating Plan assessment and analysis, hiring, online accounts promotion and technical support, capabilities and authorizations for business online accounts, ID theft and the PTIN database and broader continuing education for Enrolled Agents, among other topics.

“IRSAC members have spent numerous hours analyzing issues in tax administration and the transformation work underway across the IRS,” said IRS Commissioner Danny Werfel. “The IRS is grateful for their hard work.” 

Among the issues and recommendations:

• IRS funding: Noting that many Americans do not understand the tax gap or its impact, and that Congress rescinded some of the IRS funding granted under the Inflation Reduction Act and continues denying inflation adjustments to the IRS base budget, IRSAC recommended greatly improved communication to the public regarding the impact of the tax gap.
• Preparer oversight: The report noted that tax prep businesses “continue to train tax preparers they employ according to their own needs and standards” and that “sole proprietors have complete discretion as to their preparation and training.” Among other recommendations, IRSAC proposed a voluntary Filing Season Agent credential modeled on the Enrolled Agent credential. “Research and publish results regarding accuracy rates among [Annual Filing Season Program] record holders, uncredentialed preparers, and preparers otherwise exempt from AFSP test requirements,” the report suggested.
• EA CE: The 72 hours of continuing education required to renew enrollment for EAs should allow up to four hours of practice management, which could include business organization, communications, marketing and IT, among other topics.

The IRSAC serves as a federal advisory committee to the IRS commissioner and executive leadership. It provides a public forum for discussion of relevant issues in tax administration. IRSAC subgroups cover information reporting, large business and international, small business/self-employed, tax exempt/government entities and taxpayer services.