According to the Treasury Inspector General for Tax Administration (TIGTA), the IRS is working to comply to an executive order for reporting requirements.
Even though there has been a decline of improper payment for Earned Income Tax Credit (EITC) since the 2003 fiscal year, errors at the IRS have increased from $10.5 billion in 2003 to $14.5 billion in 2013. In a report to TIGTA, the IRS reported improper payment in 2013 of EITC totaling approx. $60 billion and that 24 % were paid in error.
This prompted an audit because Executive Order 13520 (Reducing Improper Payments and Eliminating Waste in Federal Programs) requires that TIGTA assess IRS compliance with the order annually. This is so the TIGTA could determine if the IRS has complied with the Executive Order.
They found that the IRS was not in compliance for 2013 because it has not established annual payments in error reduction target as required.
It seems the government is making more and more mistakes, costing taxpayers even more money to fix them. It’s been my experience that the mistakes are affecting individual clients rather than the taxpayers in general (meaning, you are more likely to get a letter making it seem like you made a mistake).
It is in times like this that it is most important to seek out the advice of a tax professional. The IRS will play its game to lock the taxpayer into a collections nightmare, but you don’t have to be alone in this. We can help!!
If you are receiving notices for underreported income or additional tax due, you should call us immediately. The problem won’t go away by hiding the envelope.