The Annual report recently submitted by the National Taxpayer Advocate contains the top issues plaguing the American taxpayer. It also makes recommendations on amending the tax codes to better serve the taxpayers. The report will be available for the general public to review in a week. The acting national taxpayer advocate Henry Lamar calls this report their vision of how the IRS can provide better service to taxpayers.
The most serious problem facing taxpayers, individuals and small business owners, is unfamiliarity with the tax code. They are unable to decipher the language to their advantage. Other issues include miscommunication between the various department administrations at IRS and taxpayers. They are unable to receive satisfactory answers to their problems and the solutions to their issues are not forthcoming.
The report also contains the top ten most litigated tax issues during last year. The top three spots went to filing status issues, independent contractor vs. employer issues, and penalty issues.
Amending the tax code to better serve the taxpayers was part of legislative recommendations in the report. Others include retirement plan rules, elderly and the disabled and military death benefits. Other issues from previous years that needed mention again were Earned Income Tax Credit, Alternative Minimum Tax, penalties and interest, and expansion of authorities for the IRS to correct errors, among others.