Preparing accurate tax returns is still a challenge for all too many participants in the Internal Revenue Service’s Volunteer Program, according to a new government report.
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The report, by the Treasury Inspector General for Tax Administration, found that tax returns were prepared incorrectly because some volunteers did not follow all guidelines. For example, volunteers did not always use taxpayers' intake sheets correctly.
The IRS Volunteer Program provides no-cost federal tax return preparation and electronic filing to underserved segments of individual taxpayers, including low-to moderate-income, elderly, disabled, and limited-English-proficient taxpayers. It includes the Volunteer Income Tax Assistance, or VITA, program, and the Tax Counseling for the Elderly, or TCE, program.
TIGTA conducted an audit to determine whether taxpayers visiting IRS Volunteer Program sites receive quality service, including accurate tax return preparation. The resulting report recommended that the IRS continue to emphasize with volunteers the necessity of reviewing the intake sheet with taxpayers during tax return preparation to ensure that tax returns are prepared accurately. In addition, the IRS should also establish minimum due diligence standards for volunteers when preparing tax returns, TIGTA suggested.
"The IRS has taken numerous actions to ensure the integrity of volunteers," said J. Russell George, the Treasury Inspector General for Tax Administration. "The IRS must continue to train and educate volunteers so that taxpayers will receive accurate tax return preparation.”
IRS management agreed with TIGTA's recommendations. The IRS updated Form 13614-C, Intake/Interview and Quality Review Sheet, and plans to continue to emphasize training on proper intake and interview techniques. The IRS also plans to adjust volunteer training and resource materials to clarify and underscore the due diligence obligations of volunteers when preparing tax returns.
“A fundamental objective of the IRS is to promote voluntary participation within the tax system,” wrote Peggy Bogadi, commissioner of the IRS’s Wage and Investment Division, in response to the report. “The volunteer programs sponsored by the IRS help achieve that objective by providing tax return preparation and electronic filing services at no cost to those segments of the population most in need.” She pointed out that during the 2012 filing season, more than 98,000 volunteers assisted more than 3.2 million individuals with preparing and filing their federal and state income tax returns.