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National Taxpayer Advocate Releases Mid-Year Report

National Taxpayer Advocate Nina E. Olson has released her mid-year report to Congress. The report contains a review of the 2018 filing season and identifies the priority issues the Taxpayer Advocate Service (TAS) will address during the upcoming fiscal year. It also includes the IRS’s responses to each of the 100 administrative recommendations made in the 2017 Annual Report to Congress.

The report identifies and discusses 12 priority issues the TAS plans to focus on during the upcoming fiscal year. The top five include implementation of the Tax Cuts and Jobs Act of 2017 (TCJA), the effectiveness of IRS service channels in meeting taxpayer needs, the development of an integrated case management system, the impact of high false-positive rates on legitimate taxpayers, and the protection of taxpayers facing financial hardship from IRS and private debt collection activities. The most significant challenge the IRS faces in the upcoming year is implementing the TCJA, which, among other things, requires programming an estimated 140 systems, writing or revising some 450 forms and publications and issuing guidance on dozens of TCJA provisions. The TAS has launched a new website that lists key tax return items under current law (2017), shows which ones have been impacted by the TCJA, and illustrates how the changes will be reflected on tax year 2018 returns filed in 2019.

In her preface to the report, Ms. Olson focuses on the IRS’s customer service challenges. The report says the IRS uses narrow performance measures that suggest the agency is performing well but do not reflect the taxpayer experience. Recommendations to improve customer service include:

  1. adopting robust performance measures that more accurately reflect the taxpayer experience;
  2. providing taxpayers with modernized “omnichannel” services so that taxpayers can obtain assistance online, by phone or in-person;
  3. accelerating the development of an integrated case management system; and
  4. using “big data” to help taxpayers as well as to bolster enforcement.

Further, Ms. Olson reiterated her longstanding concern that IRS funding reductions have undermined the agency’s ability to provide high-quality taxpayer service and to modernize its aging information technology infrastructure.

Post-September 30, 2018 Domestic Per Diems Is Released

The General Services Administration (GSA) has posted the federal domestic per diem rate table for fiscal year (FY) 2018 on its website. The rates are in effect from October 1, 2018 through September 30, 2019.

The per diem rate table is used by employers who pay a per diem allowance to employees for business travel away from home within the continental United States (CONUS). The per diem allowance is an alternative to reimbursing employees for their actual substantiated expenses for away-from-home lodging, and meals, and incidental expenses (M&IE). The per diem rate may not exceed the rate paid by the federal government to its workers on travel status. The rate varies by locality of travel. If employees provide simplified substantiation (time, place, and business purpose), the per diem reimbursement is not subject to income or payroll tax withholding and is not reported on the employee’s Form W-2. Standard CONUS rates apply to all counties not specifically listed in the GSA’s per diem rate table.

GSA has now posted the rates that will apply from October 1, 2018 through September 30, 2019. The maximum standard per diem rate for travel locations not listed in the per diem rate table will increase from $144 to $149 on October 1 ($94 for lodging, $55 for M&IE). The standard rates cover most of the approximately 2,600 CONUS counties. Per diem rates for localities that do not have standard rates (i.e., non-standard areas or NSAs) are listed in the per diem rate table. Total per diem rates by locality in FY 2019 range from $149 to $470. Vail, CO (Eagle County) has the highest per diem rate in the table (i.e., $470 during the period from December 1, 2018 to Mar. 31, 2019).

There are six possible M&IE rates ($55, $56, $61, $66, $71 and $76). These rates are higher than in 2018 when they were $51, $54, $59, $64, $69 and $74. Lodging rates for locations listed in the per diem rate table will range from $94 to $394 in 2019.

There is one new NSA location for FY 2019 (Marietta, GA in Cobb County). The following 21 locations that have their own rates in FY 2018 will move into the standard CONUS rate category in FY 2019:

1. Shelby County, AL;
2. Little Rock, AR;
3. Kings County, CA;
4. Bond/Calhoun/Clinton/Jersey/Macoupin/Madison/Monroe Counties, IL;
5. Plaquemines/St. Bernard Parishes, LA;
6. Leelanau County, MI;
7. Crawford/Franklin/Jefferson/Lincoln/Warren/Washington Counties, MO;
8. Butte, MT;
9. Glendive/Sidney, MT;
10. Williston, ND;
11. Sullivan County, NH;
12. Las Cruces, NM;
13. Seneca/Tioga Counties, NY;
14. Huron/Darke Counties, OH;
15. Washington County, RI;
16. Butte/Mead Counties, SD;
17. Greene County, VA;
18. Warrenton, VA;
19. Franklin/Addison Counties, VT;
20. Wheeling, WV; and
21. Uinta County, WY.

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