Taxpayer Advocacy Panel (TAP)
EITC Project Committee Face-to-Face
April 20-21, 2010 8:00 am EST

Tuesday, April 20, 2010
Wednesday, April 21, 2010

Designated Federal Official (DFO)
Ferree, Nancy TAP Program Manager, Plantation, FL

Members Present
Akbar, Sandra
Alvarado, Frank
Birge, Eileen
Cabusora, Haidee
Granger, Jacqueline
Patterson, Robert
Stepner, Gerald
Tatum, Sue
Villarreal, Josefina
Webber, Erica

Members Absent
Armstrong, Charles
Hayes, Herbert

Program Owners
Verlinda Paul, EITC Director
Patricia Lee, PESE Director (EITC Office)
Foley, Barbara, EITC Program Analyst
Anne Smiley, EITC Program Analyst

Staff Present
Shawn Collins, TAP Director
Fields, Anita, TAP Secretary
Ayala, Marianne, TAP Analyst

Tuesday, April 20, 2010

Welcome & Roll Call/Quorum

Jo Villarreal welcomed everyone to the meeting. She introduced Marianne Ayala and the EITC staff present.

Nancy Ferree welcomed everyone to the meeting and stated that if there is anything anyone needs while here to please let us know.

Shawn Collins welcomed everyone. Collins shared that recruitment is going well and it ends April 30, 2010. Currently there are 295 final applications and 1000 draft applications. Collins also shared that on the 27 of April, TAP Chair Sabby Jonathan along with a few more TAP members will have an interim conference call with NTA Nina Olsen. Jonathan will give an overview of the discussion during the JC call.

Anita did roll call and quorum was met.

Introduction of Guest
None

Review Meeting Minutes
The committee approved February and March minutes by consensus.

EITC Overview
Verlinda Paul gave a brief overview of the EITC Program and she discussed EITC Awareness Day 2010.
EITC Awareness Day (EAD) was a bustle of activity, President Barack Obama, along with the IRS and hundreds of partners, issued 143 news releases. IRS executives, managers and relationship managers joined partners, congressional members and local politicians nationwide at 72 media events. IRS representatives participated in interviews with the Washington Post and USA Today, 24 satellite media interviews with television stations, 22 satellite interviews with Spanish television stations, a conference call with 24 print reporters and 10 interviews with radio networks reaching more than 1,000 radio stations. Field Media Relations Tweeted throughout the day and there were 24 letters to the editors, 13 social media events and 99 other types of events.

Verlina also thanked the TAP members that participated in EAD. The TAP members that participated was:

Frank Alvarado—attended the EITC function in Bridgeport, CT. It was attended by the VITA sponsors, United Way, and the Mayor. It was a smaller attendance than previous years. However, it was an enthusiastic kickoff.

Jackie Granger—did not find an event in her area. She lives North of Milwaukee. Nevertheless, Jackie Granger reached out to non-profit groups who help low-income people in her county and found they had little information on EITC. Jackie is bringing them materials about EITC and is trying to get to rural areas during her term.

Bob Patterson shared that he sent letters and news releases to local newspapers and television stations. Unfortunately, it was overshadowed by the impeding snowstorm in the Northern hemisphere so it didn’t get front-page coverage.

Gerald Stepner— attended EITC day in Boston sponsored by the Boston coalition that sponsors about 30 volunteer sites. He said it was about 50-60 people there. He was able to talk about TAP to a couple of people there and it was a positive day for EITC and TAP.

Other TAP members and staff also attended EITC events, Charles Armstrong in Baton Rouge, LA, Tommy Thompson in Southaven MS, Naomi Woodward in Oklahoma and Nancy Elk in Montana.

There was some changes in the EITC Income Limits and Credit Amounts for 2010. The temporary decrease of the marriage penalty for couples filing a joint return who claim EITC continued in 2010 and the expansion of the credit for three or more children continued. This is a temporary increase for 2009 and 2010 tax years only. However, there are some congressional proposals to make permanent. Due to the lower rise in the inflation rate, there is only a slight increase for credit and the income limits from 2009 to 2010. For a single, head of household or qualifying widow or widower, in 2009 both the amount of earned income and AGI had to be less than $13,400, for 2010, the amount rose to $13,460. The maximum amount of credit remained the same. For a couple filing a joint return with 3 or more children the amount rose to $48,362 from $48, 279 in 2009; the maximum amount of credit is $5,666 from the $5,657 maximum credit in 2009.

Verlinda gave a quick update on the 2009 recommendations from the TAP EITC Committee. The partner website committee reviewed the partner site and provided input to improve. One recommendation was to keep the website updated so people know the information is current, rely on the site and keep coming back. We have been making a concerted effort to keep the website up-to-date especially the What’s Hot page, which last was updated 4/16/2010. She encouraged everyone to visit the site at www.eitic.irs.gov and provide feedback on what’s working, what should be there and what’s not easily accessible.

The Partner Relations made additional recommendations. From the work both committees did, we found out that we had many of the products Partners needed but they didn’t know what was available. Based on the findings, last year we held an internal EITC Summit to find out ways to spread the message to Partners. As a result, we expanded participants on our weekly Awareness Day calls to include those working directly with the partners. Our office also joined some regional partnership calls and talked directly to the partners about the products available.

Verlinda added that TAP is very important to the EITC office because the members are on the ground and know what is going on out there with taxpayers.

Joint Committee Report
Villarreal shared that Sabby is having an interim conference call with Nina Olsen. Shawn Collins was announced as TAP Director. There is a SWOT analysis team ongoing within TAP. It was discovered that there were issues that have been closed when they shouldn’t have. There is a new process in place to help alleviate that problem. The Annual Report is in the final stages. July is the target date for release.

2010 EITC Update
Patricia Lee thanked the members for being a part of the EITC committee. She mentioned that she is so proud of all the work done last year. Lee discussed the Return Preparer Strategy. The strategy began in 1998 and we call it due diligence requirements.

EITC have a due diligence program because of the EITC error rate, 66% of EITC returns are prepared by preparers, Congress enacted in response to EITC error rate by establishing IRS code 6695(g) and it will require preparers to take extra steps to ensure correct EITC claims.

Due diligence requirements consists of completion of Eligibility Checklist, computation of the credit, records retention and knowledge requirements.

Consequences of EITC Error for taxpayers are: math error notices, payback the credit, penalties and interest, form 8862, a two year ban of claiming the credit, and a 10 year ban of claiming the credit if it was determined to be fraud.

Lee stated there are consequences of EITC due diligence non-compliance. There are due diligence penalties, E-file sanctions, injunction actions barring preparers from return preparation and criminal prosecutions.

Lee informed the committee that the EITC office initiatives align with the new service wide goals. Those goals include increasing taxpayer compliance by leveraging the tax return preparer community, ensuring uniform and high ethical standards for tax preparers conduct through (service and outreach, education and training, and enforcement).

When the IRS EITC office do a Due diligence visit and if errors are found, the consequences for preparers are $100 per return. Beginning next year preparers that file 100 or more are required to file electronically. The objective is to reduce the number of EITC claims made in error by visiting tax preparers who file a disproportionate number of “high risk” EITC returns. The IRS agents perform on-site audits to review preparer records, verify due diligence compliance, including whether preparer is meeting the knowledge standard, and to assess penalties when noncompliance is identified.

There are also streamline injunctions. These are reserved for preparers with a demonstrated history of non-compliance, IRS, the Department of Justice (DOJ) can move quickly and shut down preparers, and preparers could face criminal prosecution and/or additional penalties.

Questions and Comments
There were no questions or comments.

Wednesday, April 21, 2010

Welcome & Roll Call/Quorum
Erica Webber opened the meeting and welcomed everyone back this morning.

Anita did roll call and quorum met.

Webber made some agenda changes and suggested that the meeting ends at 11:00am.

Subcommittee Report-Out:
Education—Jacqueline Granger shared that they were tasked to create slides to help facilitate educating people about EITC. She stated that they will put the final changes to the slide presentation in May and a goal completion is August 2010.

Training—Bob Patterson shared that the training subcommittee is tasked with coming up with an EITC training module. He stated that they are following the VITA training guide. The subcommittee goal dated for completion is June 2010.

Round Robin
Ferree and Collins stated that they think that the EITC committee members are doing an outstanding job and keep up the good work. They said that we would not have a program without the members.

Patricia Lee echoed the statements of gratitude.

Foley shared, the two projects the committee is working on this year are suggestions from prior years. She asked as you complete the projects this year, to keep an eye out and send any suggestions to Marianne and the EITC office will consider them.

Tatum shared that the she appreciated the presentations given by the program owners and it was well delivered. She asked is there anything the committee could do to help reduce the EITC error rate.

It was asked if the EITC office ever thought about verifying before the refund is released. Lee shared that they did do a three-year study and it did not get the results the EITC office anticipated. You can find the research study at www.irs.gov/EITC

The group-brainstormed ideas on how to reach individuals that qualify for EITC without having a qualifying child.

Closing
Villarreal thanked everyone for attending and she look forward to continue to work with the group. She also shared that this is her last year on the committee and she has enjoyed working with everyone.

The next meeting is a teleconference May 26, 2010 at 2:00pm EST.