The Treasury Inspector General for Tax Administration said that although the process for separating joint tax accounts in innocent spouse cases has been improved, additional action needs to be taken.

The Internal Revenue Service separates joint tax accounts to help protect innocent spouses from enforcement action that may be taken against the spouse who actually owes the feds.

The TIGTA said that it initiated an audit to evaluate a new "mirroring process" instituted as part of the IRS's revamped computer system. While it was at one time difficult for the IRS to process innocent spouse claims and properly show each spouse's separate tax liability (thus making it difficult to make sure that collection actions were taken against one spouse, but not the other), the changes were designed to help the agency treat each taxpayer separately.

The inspector general found that IRS employees did not ensure that proper actions were taken, or taken in a timely manner, in 27 percent of the taxpayer accounts reviewed.

During the course of the TIGTA's review, the IRS did revamp the program's system for inputting transaction and action codes, as well as conducting training for its employees. The IRS agreed with the report's recommendations to establish a consistent, formal methodology for managerial reviews of inventory and un-postable case lists to eliminate problems in the future.

The full report is available online at


The Internal Revenue Service announced the appointment of David R. Williams as director of the agency's Electronic Tax Administration and Refundable Credits Division.

Reporting to Williams, and focusing entirely on the administration of the EITC program, will be Debra Holland, the director of the IRS's Pre-Refund Program Office. Williams had served as the director for the EITC, health coverage tax credit and telephone excise tax refund programs, and will maintain responsibility for those programs in his new capacity.

Prior to joining the IRS in 1998 as chief of communications and liaison, Williams was a deputy assistant secretary with the Department of the Treasury. Holland had previously served as the director of business systems planning within the Wage and Investment Operating Division.

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