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The IRS’s new Offer in Compromise Pre-qualifier toolHelps Tax Practitioners determine a taxpayer’s eligibility for an offer in compromise and calculates a preliminary offer amount before they start on the paperwork. An offer in compromise is an agreement between a taxpayer and the IRS that settles the taxpayer’s tax liabilities for less than the full amount owed. 

The online tool asks information such as the taxpayer’s ZIP code, state, county, the total number of members of their household, including those over age 65, and the total IRS tax debt, along with the most recent tax year they are requesting to compromise. It begins by asking if the taxpayer is in an open bankruptcy proceeding, has filed all of the required federal tax returns, made all of the required estimated tax payments, and submitted all of the required federal tax deposits if they are self-employed or have employees.  

The tool also requests information on the taxpayer’s assets, income and expenses, and leads to a proposal. 

Last year, the IRS expanded its Fresh Start initiative to offer more help to unemployed and financially stressed taxpayers (see IRS Announces More Flexible Offer-in-Compromise Terms to Help a Greater Number of Struggling Taxpayers!). Those efforts included streamlined procedures for both installment agreements and offers in compromise. The IRS now has more flexibility with financial analysis for determining reasonable collection potential for distressed taxpayers. 

However, an offer generally will not be accepted if the IRS believes the liability can be paid in full as a lump sum or through a payment agreement. The IRS first examines a taxpayer’s income and assets before making a determination regarding the taxpayer’s ability to pay. 

The number of requests for offers increased by 28 percent between fiscal years 2007 and 2011. At the same time, the resources available at the IRS to work on the offers have decreased, creating an inventory backlog and delaying responses to taxpayers.  

The new OIC pre-qualifier tool could help the IRS reduce this backlog by encouraging taxpayers and tax practitioners to do the work ahead of time to determine whether an offer in compromise is worth pursuing.

Source:

AccountingToday

The European Commission requested consultations from the pubic regarding establishing an EU Taxpayer Identification Number (TIN).

Title

Consultation on the "Use of an EU Taxpayer Identification Number (TIN)" [short-name: EUTIN]

Policy fields

Taxation

Target groups

All citizens and organisations are welcome to contribute to this consultation. Contributions are particularly sought from individual citizens, businesses, tax practitioners, academics, intergovernmental, non-governmental and business organizations, tax administrations.

Period of consultation

From25.02.2013 to 17.05.2013

Objective of the consultation

The Commission adopted on 27th June 2012 a Communication on the fight against tax fraud and tax evasion. An Action Plan which details concrete proposals to strengthen the fight against tax fraud and tax evasion was adopted on the 6th of December 2012.   One of the 34 measures contained in the Action Plan is the creation of a European Taxpayer Identification Number (EU TIN) which is described as follows (action 22):   "TINs are considered as providing the best means of identifying taxpayers under automatic exchange of information.   The national TINs are however built according to national rules which differ considerably and make it difficult for third parties (financial institutions, employers, other) to correctly identify and register foreign TINs and for the tax authorities to report back this information to the other tax jurisdictions.   The creation of an EU TIN might constitute the best solution to overcome the current difficulties faced by Member States in properly identifying all their taxpayers (natural and non-natural persons) engaged in cross border operations.   Whether this could be a unique EU number or the addition of an EU identifier to existing national TINs is an issue which should be further explored, as should be explored links with the other existing EU registration and identification systems.   Although the concept of an EU TIN is simple, its implementation is a complex issue which calls for a step-by-step approach.   A public consultation will be launched by March 2013. The presentation of a subsequent legislative proposal requires further in-depth studies and the strong support of the Member States. As a first step, a possibility would be to further develop the "TIN on EUROPA" portal, by making it possible to check the validity of national TINs by linking this application with Member States' databases." The Commission services are launching this public consultation in order to collect the opinions of all interested stakeholders on the creation of an EU Taxpayer Identification Number (TIN). The Commission is seeking to collect information on the possible scope of an EU TIN (both in terms of operations and taxpayers covered), its practical aspects (including possible simplification and a step-by-step approach), its design and functioning, as well as various legal considerations (a.o. data protection).   The views expressed by the contributors will be used by the Commission services to identify the appropriate approach to the creation of an EU TIN and to develop the appropriate policy response.   The contributions may also be used in the possible preparation of the relating impact assessment.

The Joint Committee Released Their Explaniation of American Taxpayer Relief Act (ATRA) of 2012.

This document, prepared by the staff of the Joint Committee on Taxation in consultation with the staffs of the House Committee on Ways and Means and the Senate Committee on Finance, provides an explanation of tax legislation enacted in the 112th Congress.

The explanation follows the chronological order of the tax legislation as signed into law. For each provision, the document includes a description of present law, explanation of the provision, and effective date. Present law describes the law in effect immediately prior to enactment. It does not reflect changes to the law made by the provision or subsequent to the enactment of the provision. For many provisions, the reasons for change are also included.

In some instances, provisions included in legislation enacted in the 112th Congress were not reported out of committee before enactment. As a result, the legislative history of such provisions does not include the reasons for change normally included in a committee report.

In some cases, there is no legislative history for enacted provisions. For such provisions, this document includes a description of present law, explanation of the provision, and effective date, as prepared by the staff of the Joint Committee on Taxation.

In some cases, technical explanations of certain bills were prepared and published by the staff of the Joint Committee. In those cases, this document follows the technical explanations.

Section references are to the Internal Revenue Code of 1986, as amended, (the ‘‘Code’’) unless otherwise indicated. 

File Size:  904.52 Kb 

File Type: pdf

U.S. states could collect millions of dollars in online sales taxes, with members of both parties in Congress sponsoring legislation that would resolve states' decades-long struggle to tax businesses beyond their borders.

A bipartisan group of 53 lawmakers in the Senate and House backed the Marketplace Fairness Act of 2013 last Thursday, Febuary 15, 2013, which aims to resolve the differences between bills introduced in the Senate and House in the last Congress. 

The proposed legislation permits States to enforce the Collection of Sales & Use Taxes from Internet Retailers, placing them on a par with brick and mortar businesses.  

This Act permits States to require qualifying Sellers to collect and remit sales and use taxes on remote sales, but the States must implement certain simplification requirements.  

In the last decade, Internet sales have gone from 1.6 percent of all U.S. retail sales to more than 5 percent, according to Commerce Department data, a proportion that will likely grow as shoppers turn more to handheld devices to make purchases. In the third quarter of 2012, retail "e-commerce" sales were $57 billion, the department said. 

Large Internet retailers are worried the tax could drive up the cost of doing business. They would also have to create new systems and software to collect the surcharges, adding to their costs.

Amazon said in July it prefers having the tax issue resolved at the federal level. States and cities say they can recoup billions of dollars with the tax. Some estimate around $11 billion in tax revenues are currently being lost, due to exempt internet sales.

In the last decade, Internet sales have gone from 1.6 percent of all U.S. retail sales to more than 5 percent, according to Commerce Department data, a proportion that will likely grow as shoppers turn more to handheld devices to make purchases. In the third quarter of 2012, retail "e-commerce" sales were $57 billion, the department said.

Large Internet retailers are worried the tax could drive up the cost of doing business. They would also have to create new systems and software to collect the surcharges, adding to their costs. Amazon said in July it prefers having the tax issue resolved at the federal level.