2017 IRSAC General Report


General Report of the Internal Revenue Service Advisory Council

The predecessor to the current Internal Revenue Service Advisory Council—which was originally called the Commissioner’s Advisory Group—was first established in 1953, a year before the enactment of the Internal Revenue Code of 1954 and the reorganization of the “Bureau of Internal Revenue” into the “Internal Revenue Service.” The IRSAC’s operations are now governed by the Federal Advisory Committee Act (FACA), a “government in the sunshine” law enacted in 1972, which requires that advisory groups’ advice is made public.

As a Federal Advisory Committee, the IRSAC’s purpose is to serve as an advisory body to the Commissioner of the Internal Revenue Service. According to its charter, the IRSAC was formed to provide an organized public forum between IRS officials and representatives of the public for discussing relevant tax administration issues. Because a central purpose of the FACA is to ensure transparency in the work of government agencies and to keep Congress—and the public—informed of the activities of various advisory bodies, the IRSAC is required to hold a public meeting each year and to memorialize its advice in at least one written, public report during the year. This report summarizes the IRSAC’s work during 2017 and presents our recommendations to the Commissioner and other IRS leaders.

The IRSAC membership is balanced to include representation from the taxpaying public, the tax professional community, small and large businesses, academia, and the payroll community. The IRSAC currently consists of 21 members with substantial experience and diverse tax backgrounds, many active in professional organizations but all selected in their individual capacities because of their expertise, interest in, and commitment to improving federal tax administration. Specific subject matter and technical expertise in federal tax administration issues is generally required to help members advance the IRSAC’s mission.

This year’s IRSAC includes enrolled agents, certified public accountants, and lawyers. These members, who come from firms of varying sizes, help taxpayers prepare and file their tax returns and otherwise comply with the law, and they represent taxpayers in disputes with the IRS, both administratively and in court. The group also includes law and accounting professors, a state revenue official, a large city taxpayer advocate, a corporate tax executive, an appraiser, and a software developer. In sum, the IRSAC members interact with all operating divisions of the IRS, including Appeals and the Office of Chief Counsel, as well as with taxpayers of all sizes and types (from low-income families, trusts, and estates to multinational corporations, passthrough entities, and nonprofit organizations). Collectively, they represent the agency’s major stakeholders, customer segments, and a broad cross-section of the taxpaying public.

The members of the IRSAC are volunteers, are bound by a duty of confidentiality, and receive no compensation for their service. They eschew conflicts of interest and fully subscribe to the principle that the tax system will operate most effectively when the IRS, taxpayers, their representatives, and other stakeholders work together collaboratively. As a group, the IRSAC adheres to a consensus model of decision-making.

Working with IRS leadership, the IRSAC reviews existing practices and procedures, and makes recommendations on both existing and emerging tax administration issues. In addition, the IRSAC suggests operational improvements, conveys the public’s views on professional standards and best practices for tax professionals and IRS activities, offers constructive observations regarding current or proposed IRS policies, programs, and procedures, and advises the Commissioner and senior IRS executives on substantive tax administration issues.

The members appreciate the assistance and support provided by personnel from the IRS Office of National Public Liaison (NPL) and the operating divisions, specifically including Melvin Hardy, Director, Office of National Public Liaison; John Lipold, Chief, Relationship Management, NPL; Anna Millikan, NPL Program Manager; Maria Jaramillo, NPL; Brian Ward, NPL; Johnnie Beale, Wage & Investment; Rose Smith, Online Services; and Mary (Maggie) Monahan, Large Business & International.

The Council is grateful for the support provided by IRS executives and Operating Division personnel throughout the year and we thank them for their commitment to the IRS’s mission and for engaging in the meaningful discussions and dialogue that each subgroup held on numerous important issues. Knowing the demands on IRS executives and other IRS representatives, the IRSAC sincerely appreciates the time and effort devoted by them to the Council.

Finally, we note that the fixed duration of the term of the Commissioner of Internal Revenue means that John A. Koskinen’s service as the head of the Internal Revenue Service will end before this report is released in conjunction with the IRSAC’s public meeting on November 15, 2017. The members of the IRSAC, individually and as a group, express their appreciation to Mr. Koskinen for his service to the nation as Commissioner. The group’s sentiments were conveyed directly to the Commissioner before his departure in a letter that reads, in part:

The daunting challenges confronting the agency—including budget constraints, antiquated IT systems, identity theft efforts, and mandates to implement new legislation as complicated, capacious, and controversial as the Affordable Care Act and the Foreign Accounts Tax Compliance Act—would give many, if not most, leaders pause. But you embraced them and the intense scrutiny and oversight that come with leading an $11 billion organization that interacts with nearly every American.

From our vantage point as IRSAC members and practitioners who deal with the IRS on a daily basis, the American people should be exceedingly grateful that you answered the call of duty. Your skillful dedication to balancing the IRS’s twin goals of taxpayer service and tax enforcement, administering the tax code with fairness and integrity, and empowering the IRS’s employees while holding them accountable have borne fruit. We have observed firsthand the high esteem in which the IRS workforce holds you; their respect and loyalty toward you is no doubt owing to yours toward them. We thank you for your willingness to speak truth to power and for the optimism, acumen, and integrity you have demonstrated throughout your term as the agency’s 48th Commissioner.

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The IRSAC is currently organized into four subgroups—the Small Business/Self-Employed and Wage and Investment (SB/SE-W&I) Subgroup, the Large Business and International (LB&I) Subgroup, the Office of Professional Responsibility (OPR) Subgroup, and the Digital Services (DS) Subgroup.

Issues selected for inclusion in this annual report represent those to which the IRSAC members have devoted particular attention during four, fact-gathering working sessions of the entire Council and the subgroups, numerous conference calls involving the subgroups, and ongoing communications via telephone and email throughout the year. The issues covered in this report originated from topics that members deemed particularly important or that were raised by IRS management as deserving attention. Nearly all issues involved extensive research efforts and consultation with IRS personnel.

Subgroup Reports—Summary of Issues Discussed

The Large Business and International (LB&I) Subgroup, chaired by Thomas Cullinan, made recommendations in its report regarding (1) the new LB&I Examination Process (LEP), including how LB&I might measure the effectiveness of that process and improve communication and coordination, between LB&I and taxpayers; (2) LB&I’s new “campaign” approach of enhancing compliance on identified issues, including proposals on how the IRS might obtain feedback from various parties to better enable it to revise particular campaigns to increase efficiency and effectiveness; and (3) whether Schedule UTP, relating to so-called Uncertain Tax Positions, should be modified or abandoned in light of the changed enforcement environment.

The Digital Services (DS) Subgroup, chaired by Stephanie Salavejus, made recommendations on three issues: (1) the Tax Professional Account, including improving communication with a commitment to a timeline and coordinating with industry and state agencies to identify and implement the best solutions, as well as empowering taxpayers to authorize tax professionals to assist with compliance with the same abilities present today through paper; (2) leveraging Application Programming Interfaces (APIs) to implement a framework to support real-time authorization, thereby providing taxpayers the ability to unlock their taxpayer information and import tax information into tax software; and (3) the IRS’s implementing a digital method to process Form 2848 immediately, thereby facilitating the provision of timely assistance by representatives to taxpayers and reducing costs for the IRS and taxpayers.

The Small Business/Self Employed Wage and Investment (SBSE/W&I) Subgroup, chaired by John McDermott, addressed and made recommendations concerning (1) the W-2 Verification Code pilot program, (2) the development of a system to allow taxpayers to lock their tax accounts to protect the integrity of their tax returns, (3) marketing/promoting priority practitioner service improvements to the practitioner community, (4) the implementation of a program to engage private debt collectors to collect outstanding inactive tax receivables, and (5) the development of new collection notices to improve taxpayer responsiveness. These topics share the common themes of protecting taxpayers and ensuring the integrity of the tax collection system, the importance of clear and effective communication to improve the delivery of IRS services, and the development of systems and practices to improve the efficiency of IRS operations.

The Office of Professional Responsibility (OPR) Subgroup, chaired by Walter Pagano, developed recommendations on (1) the need for express statutory authority to confirm the Treasury Department’s ability to establish, enforce, and require minimum standards of competence for all tax practitioners, including tax return preparers, (2) educating practitioners and preparers about their responsibilities under the Internal Revenue Code’s penalty provisions and the Treasury Department’s practice standards contained in Treasury Circular 230, and (3) the use of generally accepted appraisal standards in IRS valuations equally applying one set of standards to all appraisers and appraisals might improve the IRS’s processes.

General Report

Issues covered in the IRSAC’s General Report typically represent topics that have been identified by members as broad and Service-wide and do not fall under the purview of any particular subgroup. This year, the Council has identified three issues: (1) the continuing need for the Internal Revenue Service to be adequately funded; (2) attendance by Compliance personnel from the Operating Divisions and Counsel attorneys at Appeals Division conferences; and (3) the future of the IRSAC (i.e., suggestions for strengthening the role and effectiveness of the Internal Revenue Service Advisory Council).

Before turning to these three issues, we note that during the year, the IRSAC received reports on the staffing, priorities, and activities of the Office of Appeals, the National Taxpayer Advocate, and the Office of Chief Counsel. We also engaged in a very illuminating and helpful discussion with George Contos and his colleagues in the Office of Strategic Planning of ongoing efforts to update and vivify the IRS’s Strategic Plan. The IRSAC was heartened by the IRS’s commitment to improving the taxpayer experience, not only by better leveraging new and emerging technology tools, but also by utilizing and building upon relationships that practitioners have with their clients and, more generally, taxpayers as a whole. The IRS’s commitment to collaborating with professional associations and other external stakeholders—including the IRSAC—is commendable, as are the agency’s efforts to make the IRS an employer of choice and therefore ensure a qualified and engaged workforce. We were especially pleased that the Strategic Plan focuses in part on better understanding (and positively affecting) both taxpayer and tax practitioner behavior.

Given the reality of ongoing budget constraints, of course, the process by which the agency sets and adjusts its priorities and implements its Future State initiative remains critical. Accordingly, the IRSAC believes an ongoing dialogue with the Office of Strategic Planning and other IRS leaders concerning the Strategic Plan should be a continuing part of the IRSAC’s activities, ideally early in the year.

Finally, as part of its recurring interest in sound administration of the Internal Revenue Code’s penalty provisions, the IRSAC received a very informative, and positive, update on the Office of Servicewide Penalties (OSP), which was the subject of detailed attention in last year’s General Report. The mission of the OSP is to promote fair, consistent, and effective administration of the application of the Code’s civil penalties across the entire IRS. To accomplish this mission, the OSP is charged with, among other things, soliciting and analyzing internal and external stakeholders’ input and views on the effect of civil penalties on taxpayer compliance and incorporating that information in formulating policy and guidance.

The IRSAC is very much pleased that OSP’s staffing and activities have increased. The Council was briefed on a number of OSP studies underway to measure the efficacy and effectiveness of programs and tools such as the Reasonable Cause Assistant and the First Time Abate initiative. The IRSAC commends OSP for these recent efforts, and encourages the OSP to bring even greater transparency to its activities. The IRSAC believes that properly understanding the reasons for taxpayer noncompliance (including whether it was volitional or inadvertent) is key to ensuring taxpayers’ perception of the fairness of the tax system. We are supportive of OSP’s efforts to assess the efficacy of expanding programs to abate penalties in appropriate cases, including whether some penalties should be abated automatically (i.e., without any action on the taxpayer’s part).


A recurring issue for the tax system—and the IRSAC—has been the critical importance of providing stable, adequate funding to the Internal Revenue Service. (the IRSAC’s 2016 and prior reports may be accessed here.) This topic demands continual attention because of its fundamental importance to the effective functioning of the government. The Internal Revenue Service is one of the world's largest, most efficient tax administrators. To succeed in its mission of providing “America’s taxpayers top quality service by helping them understand and meet their tax responsibilities and enforce the law with integrity and fairness to all,” the IRS must have sufficient funds to discharge its statutory duties, including helping the large majority of taxpayers understand and meet their tax obligations while ensuring that the minority who are unwilling to comply pay their fair share.

Regrettably, overall funding for the IRS has decreased dramatically—by approximately $1 billion—since FY2010, even though the requirements imposed by Congress have expanded during the same period. The agency’s increased workload is attributable not only to population growth and economic expansion, but to the enactment of the Patient Protection and Affordable Care Act (ACA), the Foreign Account Tax Compliance Act (FATCA), and other complex laws, which spawned the need for guidance and educational outreach as well as enforcement initiatives to ensure compliance.

The consequences of the cutbacks have not been minor or hypothetical. They undeniably affect every facet of the agency’s work. As Commissioner Koskinen has emphasized, the budget reductions have forced hiring freezes, training reductions, and the scaling back of both taxpayer assistance and enforcement activities. They have forced the IRS not to “do more with less” but, unavoidably, to “do less with less.” Thus, the inability to invest in modernizing the IRS’s Information Technology infrastructure, employee recruitment, and essential training has compromised the quality and timeliness of telephone assistance and other taxpayer services, slowed the processing of refunds and the issuance of necessary forms and guidance, impaired the IRS’s ability to meaningfully address tax noncompliance through audits and other enforcement and collection mechanisms, and made more difficult the task of safeguarding taxpayer information. The budget cuts are particularly concerning at a time when many of the IRS’s most experienced personnel are retiring or are eligible to retire.

The IRSAC fully appreciates the fiscal imperatives and the well-grounded commitment to accountability that have fueled both budget reductions and rigorous congressional oversight. Crafting the IRS’s budget has always entailed a balancing of competing interests. We reluctantly conclude, however, that the balance has been skewed in recent years. Actions to defund mandated programs and otherwise diminish the IRS are, in our view, ill-advised, and counterproductive. They do a disservice not so much to the agency and its employees, but to taxpayers and the Nation as a whole. Because underfunding prevents the IRS from delivering high-quality customer taxpayer service and otherwise doing its job, it harms all taxpayers by impeding the IRS’s efforts to fairly and fully administer the laws.

Because an efficient, well-functioning IRS is essential to every aspect of every agency and program of our federal government and because imprudent budget cuts exact a heavy toll on all taxpayers, the IRSAC was heartened by the testimony earlier this year by incoming Treasury Secretary Steven Mnuchin concerning the need to adequately fund the IRS. At his confirmation hearing before the Senate Committee on Finance, Mr. Mnuchin acknowledged the unavoidable consequences of staff and budget reductions on the IRS’s ability to deliver taxpayer services, combat noncompliance, and collect taxes owed. He also spoke knowledgably of the harm done by reduced IRS staffing (in terms of sheer numbers and expertise) as well as the need to “bring the IRS up to date.” Finally, he emphasized the absolute necessity of having a strong in-house technology team “to protect Americans’ information at the IRS and keep our financial architecture safe from malicious attacks,” adding that “to the extent we have resources, we can collect more money.”

Regrettably, although the need for an increased IRS budget remains unabated, Secretary Mnuchin’s powerful testimony has not yet produced sufficient results. The IRSAC wholly supports providing adequate funding to the IRS. We say this as a representative group of professionals who deal with the tax law, the tax agency, and taxpayers on a daily basis. The continued failure to do so will put our tax system, and jeopardize the IRS’s efforts to collect the revenues necessary for the government to “provide the common defense and promote the general welfare.”


The Appeals Division was established in 1927 with the mission to resolve cases, without litigation, on a basis that is fair and impartial to both the IRS and the taxpayer and in a manner that enhances both voluntary compliance and public confidence in the integrity and efficiency of the IRS.  When an IRS examination ends without agreement between the taxpayer and the Compliance function—Examination, Collections, and Accounts Maintenance—the taxpayer has the opportunity to protest the proposed assessment administratively by asking Appeals, a separate part of the agency, to review the areas of disagreement and hold settlement discussions with the taxpayer. While Compliance personnel and representatives of the IRS Office of Chief Counsel have participated in the past in preconferences with Appeals and the taxpayer (if they are held), they generally do not participate beyond that point. This separation of Appeals from the Compliance function and Counsel helps safeguard the independence and impartiality of Appeals.

In 2016, the Appeals Division implemented changes in its conference procedures that, among other things, expand the circumstances in which Appeals may invite personnel from the Compliance (Examination) function and the Office of Chief Counsel to participate more broadly in Appeals conferences. Earlier this year, Appeals reiterated its support of those changes and announced a pilot program, effective May 1, 2017, for Appeals Team Cases requiring the attendance of Compliance personnel (as well as Chief Counsel attorneys) at conferences held by approximately one-third of the Appeals Team Case Leaders (ATCL). (These ATCL cases typically involve matters that had been examined by Large Business & International Division.) The IRSAC appreciates that these changes were intended to aid case resolution, but is concerned about their practical effect.

Ensuring the independence of Appeals from the operating divisions is indispensable to Appeals’ achieving its mission. The concept of Appeals’ independence is so vital that the Congress expressly addressed this requirement in the Internal Revenue Service Restructuring and Reform Act of 1998, which among other things prohibits ex parte contact between Appeals and other parts of the IRS.  Taxpayers must have the confidence that they will be able to work with Appeals professionals who will be independent of the other divisions of the IRS. If the independence of Appeals, or even the appearance of independence, is compromised, taxpayers would see little benefit of utilizing Appeals in an effort to resolve their cases administratively. The alternative would be litigation, which would invariably be more costly and time consuming. Furthermore, while the principles of the ex parte contact prohibition may not be directly implicated in the changes (since the taxpayer would still be involved in the process), the IRSAC is concerned about the initiative’s potential effect on the appearance and substance of independence.

Since its inception 90 years ago, Appeals has been able to reach mutual agreements in the vast majority of disputed cases. While Appeals serves as the IRS’s primary administrative alternative dispute resolution (ADR) forum, it does not operate in the same manner as other forms of ADR. An Appeals Officer (AO) is not technically a “neutral” party. Rather, Appeals employees are vested with the authority to resolve matters, weighing the merits of arguments on both sides and taking into account (among other things) the hazards of litigation.  Based on the experiences and observations of many IRSAC members, Appeals is a true “success story” for the IRS.

The IRS recently released a set of frequently asked questions (FAQ) relating to the involvement of Compliance and Counsel personnel in Appeals conferences. The document explains that the goals of the initiative are “to improve conference efficiency, reach case resolution sooner, and offer earlier certainty for issues in future years.”

Narrowing the scope of factual and legal differences and making the process more efficient are clearly laudable goals for Appeals. The IRSAC has reservations, however, whether the new initiative is necessary to achieve its ends, is concerned that the initiative will not succeed and is concerned about the potential ill effects of the recent changes. To appreciate our concerns, it is important to first consider traditional Appeals large case procedures:

  • When Large Business & International (LB&I) considers raising an issue during an examination, it generally prepares a Notice of Proposed Adjustment (NOPA). The taxpayer is provided an opportunity to respond. If LB&I holds to its view, it will prepare a Revenue Agent’s Report (RAR), which will discuss, in detail, the facts and legal positions of both the IRS and the taxpayer.
  • Upon receipt of the RAR, the taxpayer has 30 days to prepare a protest. A well-drafted protest will generally set forth a detailed description of the facts and the applicable legal precedent and then discuss the application of the law to the facts; it will also discuss the taxpayer’s differences with the law and the facts as described in the RAR.
  • Upon receiving the protest, LB&I has the opportunity to prepare a rebuttal that addresses each disagreement or interpretative nuance it has with the facts or legal arguments contained in the protest. Pursuant to Rev. Proc. 2012-18, the rebuttal can be shared with the taxpayer.
  • Before the Appeals conference with the taxpayer begins, a pre-conference meeting is held with LB&I personnel (including pertinent specialists and Counsel), who can present their position to the Appeals professionals. Taxpayers are invited to attend the pre-conference.

As the foregoing summary confirms, the current Appeals procedures in LB&I cases already serve to focus Appeals professionals on legal and factual differences in a case. Greater participation in the preconference by taxpayers is a worthy goal, but the IRSAC questions whether the required and routine attendance of Counsel and Compliance personnel at Appeals conferences is conducive to that goal.

More important, we are concerned about the potential negative consequences of having Compliance personnel and Counsel attorneys in Appeals conferences as a matter of course. First, the initiative could require additional time to arrange meetings and secure input from the additional participants. Second, and more concerning, it could change in the customary dynamics of the Appeals process, undermining its core value. A third, ancillary concern is that the involvement of Compliance personnel in Appeals could disrupt the taxpayer’s working relationship with the examination team in future years.

Currently, the Appeals discussions take place between the two parties (the Appeals officer and the taxpayer), both with the ability to reach a reasoned resolution of the issues. Under the new initiative, additional players (from Compliance or Counsel) participate in the process, and while they technically may not have the ability to resolve issues, from the taxpayer’s perspective they can disrupt the process and can unduly influence the decision-maker. This can affect the appearance, if not the reality, of Appeals’ independence. To be sure, the taxpayers involved in the ATCL pilot program are likely sophisticated and well-represented; nevertheless, the unintended consequences of the change could be substantial.

In addition, alternatives already exist for cases where the taxpayer and the IRS agree that continued Compliance or Counsel participation would be helpful. Fast Track Settlement (FTS)  is an ADR alternative that has been effectively used, on an optional basis, if both the taxpayer and LB&I reasonably believe that settlement is achievable. FTS is a non-binding, voluntary process where an Appeals professional effectively acts as a traditional neutral. Another alternative is the Rapid Appeals Process (RAP).  This voluntary process does give Compliance and Counsel a seat at the table, while keeping settlement authority with Appeals. The idea behind RAP is to focus on areas of agreement and disagreement. This, of course, is the same goal as the new initiative, though made mandatory.

In conclusion, the IRSAC is concerned about the significant negative effect that the new initiative could have on the Appeals resolution process and the existence and appearance of Appeals’ independence. Our first preference is for Appeals to reinstate its prior policy of limiting the involvement of Compliance and Counsel personnel in Appeals conferences pending further study and discussions with the practitioner community and other affected stakeholders. Alternatively, we recommend that, as Appeals evaluates the current pilot, it pay especially close attention to the potential detriments discussed in this report.



Although the precise charter, structure, and the operating procedures of the IRSAC have by no means remained constant since its initial establishment as the Commissioner’s Advisory Group in 1953, the advisory body’s essential duty has remained unchanged over six and a half decades: to provide the Commissioner of Internal Revenue with candid advice about how to improve tax administration. The IRSAC’s current charter broadly defines the group’s duties, as follows:

The IRSAC reviews existing policy and/or recommends policies with respect to emerging tax administration issues, suggests operational improvements, offers constructive observations regarding current or proposed IRS policies, programs, [and] procedures, and advises the Commissioner or his delegate and senior IRS executives with respect to issues having substantive effect on federal tax administration. The IRSAC researches, analyzes, considers, recommends, and advises IRS on issues that include customer service, compliance, taxpayer segment-specific issues, and factors regarding non-compliance.

The charter specifies that the IRSAC is to provide a written report to the Commissioner “at least annually,” and it is the understanding of the current members of the IRSAC that the group’s advice has historically indeed been limited to a single, written report each year. (This is not to say that the information exchange between the IRSAC members and IRS personnel has not been ongoing and productive, only that formal recommendations have been confined to the written report presented at the public annual meeting.)

In light of ongoing technological advances (which enable the IRSAC members and their IRS counterparts to conduct their work other than at a limited number of face-to-face meetings during the year) and the time-sensitive nature of some topics that the IRSAC regularly addresses—e.g., the IRS’s strategic plan, its budget, and the need to clarify the Treasury Department’s authority, via Treasury Circular 230, to regulate tax practitioners (and tax return preparers)—we believe it would be productive for the IRS to consider how the IRSAC can operate most effectively in the future.

An initiative to “reimagine the IRS Advisory Council,” overseen by the Designated Federal Officer but also involving both IRS employees and IRSAC members, seems especially important with the impending appointment of a new Commissioner of Internal Revenue and the very real prospect of significant tax law changes as part of an ongoing tax reform effort. Among the issues that the IRSAC believes could appropriately be addressed in the review are—


  • The circumstances under which the IRSAC may file interim reports with the Commissioner.
  • Since a central purpose of the FACA is to ensure that Congress and the public are kept informed of the activities of various advisory bodies, whether and when it is permissible for the IRSAC to formally disseminate its views more broadly, for example, to the Taxpayer Advocate or Congress.
  • Whether there may be a role for the IRSAC, working with the Office of National Public Liaison, in reaching out to other stakeholders (such as professional associations) to gather feedback, or participate in open forums, on select topics. (This past year, the IRSAC informally communicated with representatives of certain associations as part of the research state of its work on some issues.)

At this time, the IRSAC makes no recommendations pertaining to these issues, other than that they be reviewed. In addition, we believe it would be beneficial to consider the mix of in-person and virtual meetings (or conference calls) to enable the IRSAC to better and more efficiently shape its agenda and do its work. For example, the IRSAC did not have the opportunity to meet with the Chief Counsel or the Taxpayer Advocate until its final working session (in September), long after the group had identified the issues to be covered in its annual report; our meeting with representatives of the Office of Strategic Planning did not occur until July. Incorporating virtual meetings more fully into the IRSAC’s operating procedures would have allowed the IRSAC to receive these reports earlier in the year and to more realistically consider whether the information conveyed in those reports merited attention in the annual report. (The subgroups did effectively use conference calls with pertinent operating division personnel throughout the year.)

Finally, the IRSAC appreciates that a number of factors, including the constricted IRS budget, led the IRS to combine the SB/SE and the W&I subgroups two years ago. Given the importance of the work done and the constituencies served by SB/SE and W&I, augmented by our experience the past two years, the IRSAC believe that the IRS should reinstate SB/SE and W&I as separate subgroups.