Report Card Time

Memorial Day has come and gone, and the school year is quickly winding down, if it isn't already over. Kids are getting excited for summer vacay, and there's just one hurdle left — the dreaded report card. (If your kids are getting nervous and antsy around mail time, you might want to pay attention!)

And how do you think our friends at the IRS are doing? Well, this year's Annual Report listed twenty-two problems, not 20. Their biggest conclusion is that the IRS is simply "not adequately funded to serve taxpayers and collect taxes." It identifies "the combination of the IRS’s expanding workload and declining resources as the most serious problem facing taxpayers."

And there were more specific problems, too. The IRS has to rely on computers to do most of their work, and computers don't always get things right. The IRS adjusts about 15 million returns per year — but treats only 10% of those as "audits," so taxpayers don't always get traditional audit protections. And sometimes the IRS is just too busy to respond: they answer just 70% of taxpayer phone calls, and just 53% of written correspondence gets answered in 45 days. It's hard to ace your report card when you're missing that much of your homework!

Fortunately, the news isn't all bad — the IRS has joined the social media revolution! There's a smartphone app to help track your refund, a channel with helpful videos in English, American Sign Language, and various foreign languages, and podcasts you can download from the iTunes store. You can even on Facebook and Twitter!

Our "Plan A," of course, is to give you the concepts and strategies to help you pay the least amount of tax legally possible — then help prepare returns that avoid IRS scrutiny. But just in case that scrutiny finds you, we're always ready with "Plan B" — to help deal with the IRS on your behalf, and make sure you don't become another Annual Report statistic!