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Treasury Inspector General Releases Results of IRS Audit
April 6, 2011
On March 24th, The Treasury Inspector General for Tax Administration (the “TIGTA”) released an audit report of the IRS’s Correspondence and Discretionary Examination (the “CDE”) Program. CDE is the formal name for IRS audits via the mail system. When a tax return is selected for audit under the CDE Program, a taxpayer is sent a letter requesting additional information to support specific tax items listed in the letter. Issues have arisen regarding the length of time it often takes to obtain a final resolution. Additionally, complaints lodged against the IRS have claimed a lack of communication between the taxpayer and auditor. The complaints ranged from failure to return taxpayer calls to receiving correspondence letters that were extremely difficult to understand. The IRS sought to revamp the CDE Program and later engaged the TIGTA to assess the revamped program’s effectiveness. The results were mixed. Rather than attempt to explain the improvements, shortcomings and TIGTA recommendations, you can read the entire report here. The IRS appears to have acknowledged at least some of TIGTA’s audit recommendations and have attempted to improve the CDE Program by aligning some of their procedures more closely to the TIGTA recommendations. If the goal is to lessen the financial and personal burden on taxpayers, then the IRS is going to have to do better than make an attempt. Time will ultimately tell whether or not the IRS is successful in this goal, but my hope is that within the year the IRS reaches out to TIGTA once more for an update on its progress in the matter.