The IRS's Taxpayer Advocacy Panel has released an annual report on its activities and recommendations for improving the Internal Revenue Service.

Last year, TAP's area committees produced 19 recommendations, including the revision of Form 1127, Application for Extension of Time for Payment of Tax, which has not been revised since 1993, to update where to file the form and the appropriate function and position titles of the approver.

TAP also recommended that the IRS provide clearer instructions on the classification and reporting of income from a litigation settlement resulting from securities class-action suits. TAP said the IRS should reduce the rejections of e-filed returns due to mismatches of Social Security numbers and names on electronically filed returns of taxpayers with multiple last names.

It also recommended that the IRS revise the instructions for Form 8300, Report of Cash Payments Over $10,000 Received in a Trade or Business, to improve their clarity and consistency. In addition, TAP said the IRS should assist taxpayers in obtaining forms and publications during the filing season by providing basic information on how to obtain them at sites where taxpayers might ordinarily go to find them.

The TAP issue committees recommended reviewing the 2007 instructions for Form 1040 and providing input to the IRS on issues faced by taxpayers filing Schedule C. The committees also recommended reviewing numerous IRS notices and publications for readability and usability, and providing specific recommendations to improve the electronic filing process throughout the Volunteer Return Preparation Program.

The committees also issued recommendations to improve services to the visually impaired, and conduct surveys to assess the customer service experience from both sides of the counter in IRS Taxpayer Assistance Centers across the nation.

A copy of the 2007 TAP Annual Report is available at www.improveirs.org.

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