Tax Professionals: Darrel Beadle, Jacob Borash, Barbara Brown, Carrie Christensen, Robin Clemmensen, Brad Decker, Jodi Eckhout, Maria Gaffney, Jacen Gondringer, Truman Hardy, Steffanie Haring, Marshall Heap, Cindy Hockenberry, James Hockenberry, Stephanie Jerge, Terry Johnson, Bill Kelly Judy Lashinski, Linda Martin, Ruth Ann Michnay, Kaye Nabo, Dan Ogard, Jodee Paape, Darian Panasuk, Joshua Prince, Kathy Reiniger, Diane Saeger, Jing Shan, Laura Swanson, Will Wallace, Angela Siener Williams
Doug Blade, Karen Brehmer, Kathleen Fox, Eden Holsman, Alan Gregerson, Mike Mudroncik,
Stakeholder Liaison Managers:
Kristen Hoiby, Manager of Area 6 Shane Ferguson, Director
Departments of Revenue:
Halla Elrashidi – MN John Fuller – IA Dawn Holtmeier – NE Fran Krejci – NE
Four webinars planned for June. Check Webinars for Tax Practitioners.
Check out the archived webinars on the IRS Video Portal.
1) Sec 199A, DPAD, Form 1040 line 10
Form 1040 instructions for line 10:
“If you have a domestic production activities deduction passed through from an agricultural or horticultural cooperative under section 199A(g), attach a statement to your return titled “DPAD 199A(g).” Reduce the amount of taxable income you enter on line 10 by the amount of your deduction.”
In some instances, generally before March 1, the IRS appears to have missed this statement, and we sent CP11T telling the taxpayer that their tax was computed incorrectly. But it was not wrong – it was an IRS error. The tax preparer should get Form 2848 and call PPS. (FYI – You can call PPS if you checked the Third Party Checkbox.) Tell PPS that the statement was overlooked and the tax on line 10 is correct. You may have to send a letter to the IRS to get us to correct the tax.
2) The IRS Video Portal has archived webinars
Why this matters: You can view webinars you missed. You can get the PPT and a transcript
of the audio.
• IRS Video Portal at www.irsvideos.gov
• Tax Reform webinars on the home page.
• Click on Tax Practitioners tab for more webinars.
• Use search box to find topics of interest.
• The video portal shows the length of the video or webinar.
• The video portal shows the date it aired, or the date it was reviewed for accuracy.
• You can’t get CE, but it’s good to learn something new!
3) National Taxpayer Advocate Report
Why this matters: Find out what the National Taxpayer Advocate says about the issues the
IRS is facing. Find out what she says about taxpayer’s experiences with the IRS.
• National Taxpayer Advocate delivers annual report to Congress: Addresses impact of
shutdown; urges more funding for IT modernization
• Read the 17 page preface
• The full report is split into two volumes.
• The largest section of the report, which identifies at least 20 of the most serious problems
taxpayers face in their dealings with the IRS, is titled, “The Taxpayer’s Journey,” and is
organized sequentially to track a taxpayer’s interactions with the tax system from start to
finish. Among other issues, it addresses the ability of taxpayers to obtain answers to taxlaw
questions, return filing, notices, audits, collection actions and Tax Court litigation. The
report also contains “road maps” – pictorial representations of the process.
• “One of our goals in creating these roadmaps was to help readers understand the
complexity of the taxpayer journey,” Olson wrote. “It was challenging for us to create
these roadmaps and will probably be difficult for readers to follow them, which hints at the
extreme frustration many taxpayers experience when they have to interact with the IRS.”
o Ruth Ann Michnay commented that she has printed the 6 page “road map” and
shares it with clients to show where they are in the IRS process. She explained
that it’s a great visual.
• The Purple Book presents 58 legislative recommendations designed to strengthen
taxpayer rights and improve tax administration.
• Trivia question: Why is it called the Purple Book? Answer: The Office of the Taxpayer
Advocate is an independent organization within the IRS that advocates for the interests of
taxpayers. The office is non-partisan, and we have dubbed this the “Purple Book”
because the color purple, as a mix of red and blue, has come to symbolize a blending of
4) If you are interested in becoming a CAA, now is a good time to do it.
Why this matters: The Service is actively recruiting Certifying Acceptance Agents. The goal
is to increase the availability of individual ITIN services nationwide, particularly in
communities with high ITIN usage.
• CAA stands for Certifying Acceptance Agent.
• Difference between Acceptance Agent and Certifying Acceptance Agent:
o An AA reviews supporting documentation, original or certified copies and
attaches it to Form W-7.
o A CAA reviews and validates the documents and prepares Form W-7 (COA)
Certificate of Acceptance.
• New ITIN Acceptance Agent Program Changes
5) Draft of the 2020 Form W-4, Employee’s Withholding Allowance Certificate
IRS, Treasury unveil proposed W-4 design for 2020
FAQs on the early release of the 2020 Form W-4
If you have comments about this draft of Form W-4, you can submit them to
WI.W4.Comments@IRS.gov. Comments should be submitted by July 1, 2019 to be
Publication 15-T, Federal Income Tax Withholding Methods
• Draft Pub 15-T here
• When Pub 15-T is finalized, it will be here
6) Tax Transcript faxing service ends June 28
Why this matters: This is a good time to get set up to access transcripts using Transcript
Delivery System (TDS).
• IRS takes additional steps to protect taxpayer data; plans to end faxing and thirdparty
mailings of certain tax transcripts
• Tax professionals who are attorneys, Certified Public Accountants or Enrolled Agents
(i.e., Circular 230 practitioners) and do not have an e-Services account may create
one and, with proper authorization from clients, can access the e-Services’ Transcript
Delivery System. Unenrolled tax practitioners must have an e-File application on file
and be listed as delegated users to access TDS.
7) Follow up on previous month’s IMRS issues
No POA Notices Received, IMRS issue 18-0002259.
Notice CP522 was not sent to practitioner who had a valid POA, but only to the taxpayer.
Collection indicates that the CP522 is only sent to the taxpayer or entity, even if there is a
POA on file. Practitioners say that they need to get copies of CP522.
Similarly, only the taxpayer gets a copy of the letter informing them they are switching from
being a monthly depositor to semi-weekly depositor. The POA or reporting agent needs to get
a copy of this notice, too.
This issue is still being worked.
Your issues and questions:
1) Filing season review
What went well? What didn’t? What can the IRS do to help you prepare for filing
Comments on the new 1040 form:
The new Form 1040 is like signing a blank check. The taxpayer signs under penalty of
perjury on page 1. There are no dollar figures on page 1 (no income, AGI, tax, etc). All of
that is on page 2. The taxpayer could sign page 1 and an unscrupulous person could
change everything on page 2. The taxpayer has no idea what he or she is signing.
- Many tax pros agreed with the statement above: the comment that signing page one is
like signing a “blank check” was excellent. Anything on page two could be added or
changed without the taxpayer or preparer awareness.
- The new Form 1040 serves no real purpose. It wastes paper. It’s time-consuming when
trying to compare years because numbers are buried.
- New forms are awful. They added wasted paper and confusion.
- The new 1040 makes it more difficult to explain to taxpayers, having to switch between
1040 and schedules.
- The old 1040 was a good summary of income and deductions. They fixed something that
did not need to be fixed.
- Agree with everyone – need to scrap the whole thing and go back to the “old” form.
Waste of paper, very confusing, lots of flipping back and forth when trying to review, etc.
- The numbers don’t add up. An example would be the calculations on line 6 and line 7 of
- Line 6 Total income. Add lines 1 through 5. Add any amount from Schedule 1,
- Line 7 Adjusted gross income. If you have no adjustments to income, enter the
amount from line 6; otherwise, subtract Schedule 1, line 36, from line 6
- There is no place for the tax preparer to enter the date they signed the return.
- One tax pro said the new 1040 design doesn’t go far enough. They should have changed
Form 1040 to be more like Form 706. One line for income with a schedule attached. One
line for deductions with a schedule attached, etc.
2) Another DPAD question
Marshall Heap asked: What about the deduction of the DPAD when calculating MAGI for
determining taxable social security benefits? IRC §86(b)(2)(A) was modified by the TCJA to
no longer make this adjustment but some taxpayers are receiving DPAD in 2018 from fiscal
year partnerships. Most tax preparation software no longer makes this adjustment for 2018
even though it was made in prior years. However, the IRS have been making this adjustment
and issuing refund checks. What should taxpayers do with these checks? The IRS recalculation
complies with the intent of the law but not the letter of the law.
This has been elevated to the TCJA cadre via the IMRS process.
3) VITA returns
Mike provided filing season statistics. This page shows the number of returns e-filed by tax
professionals, and the number of e-filed returns that are self-prepared. Someone asked if
returns prepared through the VITA/TCE program are included in those numbers. No, they are
4) Fax machines
Question: Are fax machines turned off on evenings and weekends? Tax pro sent a fax but it
did not go through.
Answer: The majority of IRS fax numbers are e-Fax numbers, which means the fax is
delivered to an email Inbox. We have very few, if any, traditional fax machines. The e-Fax
numbers were turned off during the government shutdown. Under normal circumstances, e-
Fax numbers remain available 24/7. If you send a fax to an IRS fax number and feel it did not
go through, please contact your local stakeholder liaison.
5) Form 8839
IRS did not accept F8839 adoption electronically last filing season. Why?
We will research this.
State Departments of Revenue:
John Fuller – IA
The Iowa Department of Revenue has partnered with the Center for Business Growth
and Innovation at the University of Northern Iowa to provide free tax webinars on
Geothermal Heat Pump Tax Credit
Mark Krause – MN
Our new website launched June 4th. The main website address remains the same.
However, many of the URLs have changed that take you to specific pages. You may
need to update any saved bookmarks in your browser to reflect the changes to our
website. We hope you enjoy using our new website. If you have any feedback or notice
anything missing, please contact me.
• The Governor signed the 2019 tax bill into law on May 29th. This bill address conformity
for tax years 2017 and 2018 and updates the tax code for tax year 2019. We have begun
reviewing and analyzing the bill and its impacts on our customers. It’s extremely
important that you do not file any amended returns that specifically address retroactive
provisions contained in the tax bill for any tax year affected. We will provide further
guidance and resources on our website once we have determined the full impacts of the
bill. Notice that the orange Tax Law Changes button has been replaced by a link on the
bottom of our website. In the meantime, you may sign up , verify or update your
subscription by entering your email address in the request field on the lower right hand
corner of our website and then clicking the Subscribe button.
• We began mailing letters this week to approximately 185,000 taxpayers that may have
included pre-tax medical and dental premiums on line 5 of the M1PR as household
income for 2018. Do not amend a 2018 M1PR to correct this specific issue. If there were
no pre-tax premiums included, the taxpayer doesn’t need to respond. If there were pretax
premiums included, they can either enter the total amount on the letter and mail it
back to us or they can use our new online Letter Response System which will ask for a
few simple pieces of data and then it will submit the information electronically. The
requested information cannot be phoned in by anyone. The good news is that refunds will not be delayed regardless of receiving a response or not. If we get new information after
the refund was processed, we will issue a separate additional refund. For any year other
than 2018 that needs to be corrected, an M1PRX will need to be filed.
Dawn Holtmeier and Fran Krejci – NE
Filing season went well.
The next call will be on the second Thursday in July: THURSDAY, JULY 11.
We’ll send out the WebEx link closer to that date.
Meetings are one hour long. Come when you can, leave when you must.
Thank you to everyone who attended. We appreciate your time and input!