On Monday, the IRS will issue furlough notices to all agency employees, identifying five furlough days with the possibility of two more. On those five days, the IRS will completely close all but the most essential operations. This unprecedented action is a direct result of the failure of Congress to avoid sequestration.

This is unwelcome news for every employee and is an event NTEU has worked hard to avoid. At the national level, the union is in ongoing discussions with the IRS exploring all possible options to ease the impact of these unpaid furlough days on employees. While NTEU sought flexibility for employees in scheduling the furlough days, the IRS maintains that it has the right to set the days without regard for employees preferences for days off. The planned furlough days are May 24, June 14, July 5, July 22 and August 30. Our talks with the IRS will continue.

The furlough notice you will receive on Monday identifies a 30-day window before furloughs begin. During that time, NTEU will continue with our strong and vocal presence on Capitol Hill demonstrating to lawmakers the devastating impact on federal employees and the American public of the ongoing sequester. It is NTEU’s intention to bring the full impact of this unprecedented closing to the attention of Congress. 

NTEU will also keep IRS employees informed of any new developments regarding sequestration and furloughs. To be sure that you receive all NTEU communications, please provide us with your home e-mail address. You may do this now, on your government computer, in accordance with the agency’s policy on limited personal use of the Internet.   

There is additional information about sequestration and furloughs available on NTEU’s web site. Learn more. 

FSLG will conduct a phone forum on April 30^th at 2:00PM (EST) to discuss key provisions of the Affordable Care Act. These provisions impact federal, state, and local government employers. To learn more and register, click the following link.

WASHINGTON - The Internal Revenue Service today announced a three-month tax filing and payment extension to Boston area taxpayers and others affected by Monday’s explosions.

This relief applies to all individual taxpayers who live in Suffolk County, Mass., including the city of Boston. It also includes victims, their families, first responders, others impacted by this tragedy who live outside Suffolk County and taxpayers whose tax preparers were adversely affected.

“Our hearts go out to the people affected by this tragic event,” said IRS Acting Commissioner Steven T. Miller. “We want victims and others affected by this terrible tragedy to have the time they need to finish their individual tax returns.”

Under the relief announced today, the IRS will issue a notice giving eligible taxpayers until July 15, 2013, to file their 2012 returns and pay any taxes normally due April 15. No filing and payment penalties will be due as long as returns are filed and payments are made by July 15, 2013. By law, interest, currently at the annual rate of 3 percent compounded daily, will still apply to any payments made after the April deadline.

The IRS will automatically provide this extension to anyone living in Suffolk County. If you live in Suffolk County, no further action is necessary by taxpayers to obtain this relief. However, eligible taxpayers living outside Suffolk County can claim this relief by calling 1-866-562-5227 starting Tuesday, April 23, and identifying themselves to the IRS before filing a return or making a payment. Eligible taxpayers who receive penalty notices from the IRS can also call this number to have these penalties abated.

Eligible taxpayers who need more time to file their returns may receive an additional extension to Oct. 15, 2013, by filing Form 4868 by July 15, 2013.

Taxpayers with questions unrelated to the Boston tragedy should visit IRS.gov, or contact the regular IRS toll-free number at 1-800-829-1040.

The IRS Fresh Start program makes it easier for taxpayers to pay back taxes and avoid tax liens. Even small business taxpayers may benefit from Fresh Start. Here are three important features of the Fresh Start program:

• Tax Liens. The Fresh Start program increased the amount that taxpayers can owe before the IRS generally will file a Notice of Federal Tax Lien. That amount is now $10,000. However, in some cases, the IRS may still file a lien notice on amounts less than $10,000.

When a taxpayer meets certain requirements and pays off their tax debt, the IRS may now withdraw a filed Notice of Federal Tax Lien. Taxpayers must request this in writing using Form 12277, Application for Withdrawal.

Some taxpayers may qualify to have their lien notice withdrawn if they are paying their tax debt through a Direct Debit installment agreement. Taxpayers also need to request this in writing by using Form 12277.

If a taxpayer defaults on the Direct Debit Installment Agreement, the IRS may file a new Notice of Federal Tax Lien and resume collection actions.

• Installment Agreements. The Fresh Start program expanded access to streamlined installment agreements. Now, individual taxpayers who owe up to $50,000 can pay through monthly direct debit payments for up to 72 months (six years). While the IRS generally will not need a financial statement, they may need some financial information from the taxpayer. The easiest way to apply for a payment plan is to use the Online Payment Agreement tool at IRS.gov. If you don’t have Web access you may file Form 9465, Installment Agreement, to apply.

Taxpayers in need of installment agreements for tax debts more than $50,000 or longer than six years still need to provide the IRS with a financial statement. In these cases, the IRS may ask for one of two forms: either Collection Information Statement, Form 433-A or Form 433-F.

• Offers in Compromise. An Offer in Compromise is an agreement that allows taxpayers to settle their tax debt for less than the full amount. Fresh Start expanded and streamlined the OIC program. The IRS now has more flexibility when analyzing a taxpayer’s ability to pay. This makes the offer program available to a larger group of taxpayers.

Generally, the IRS will accept an offer if it represents the most the agency can expect to collect within a reasonable period of time. The IRS will not accept an offer if it believes that the taxpayer can pay the amount owed in full as a lump sum or through a payment agreement. The IRS looks at several factors, including the taxpayer’s income and assets, to make a decision regarding the taxpayer’s ability to pay. Use the Offer in Compromise Pre-Qualifier tool on IRS.gov to see if you may be eligible for an OIC.

Additional IRS Resources:

• Online Payment Agreement tool
• Fresh Start Notice of Federal Tax Liens
• Form 12277, Application for Withdrawal
• Understanding a Federal Tax Lien
• Offer in Compromise Pre-Qualifier tool
• Offer in Compromise
• Electronic Payment Options Home Page
• Payments (payment options)

IRS YouTube Videos:

• Online Payment Agreement - English

IRS Podcasts:

• Online Payment Agreement - English

Due to the significant increase in federal and state submissions transmitted on April 15th, the length of time to create federal acknowledgments and make them available for retrieval is taking longer than expected. The IRS is closely monitoring the acknowledgment rates and is working to close the gap as a top priority.

The majority of state returns are linked to the acceptance of the federal return, so the length of time it takes to make the state return available for state retrieval has also increased. As the federal backlog decreases, the state submissions will then be ready for state pickup.

In the interim, please do not retransmit any submissions awaiting acknowledgment if the IRS has issued a receipt.

We thank you again for your patience and support.

The IRS has some advice for taxpayers who missed the tax filing deadline.

• File as soon as possible.  If you owe federal income tax, you should file and pay as soon as you can to minimize any penalty and interest charges. There is no penalty for filing a late return if you are due a refund.
• Penalties and interest may be due.  If you missed the April 15 deadline, you may have to pay penalties and interest. The IRS may charge penalties for late filing and for late payment. The law generally does not allow a waiver of interest charges. However, the IRS will consider a reduction of these penalties if you can show a reasonable cause for being late.
• E-file is your best option.  IRS e-file programs are available through Oct. 15. E-file is the easiest, safest and most accurate way to file. With e-file, you will receive confirmation that the IRS has received your tax return. If you e-file and are due a refund, the IRS will normally issue it within 21 days.
• Free File is still available.  Everyone can use IRS Free File. If your income is $57,000 or less, you qualify to e-file your return using free brand-name software. If you made more than $57,000 and are comfortable preparing your own tax return, use Free File Fillable Forms to e-file. This program uses the electronic versions of paper IRS forms. IRS Free File is available only through IRS.gov. 
• Pay as much as you can.  If you owe tax but can’t pay it all at once, you should pay as much as you can when you file your tax return. Pay the remaining balance due as soon as possible to minimize penalties and interest charges.
• Installment Agreements are available.  If you need more time to pay your federal income taxes, you can request a payment agreement with the IRS. Apply online using the IRS Online Payment Agreement Application tool or file Form 9465, Installment Agreement Request.
• Refunds may be waiting.  If you’re due a refund, you should file as soon as possible to get it. Even if you are not required to file, you may be entitled to a refund. This could apply if you had taxes withheld from your wages, or you qualify for certain tax credits. If you don’t file your return within three years, you could forfeit your right to the refund.

For more information, visit IRS.gov.

Additional IRS Resources:

• IRS Free File
• E-file Options
• Make a Payment – payment options
• Online Payment Agreement tool
• Form 9465, Installment Agreement Request 

IRS YouTube Videos:

• Do Your Taxes for Free: Taxes Made Less Taxing - English | Spanish
• Online Payment Agreement - English

IRS Podcasts:

• Online Payment Agreement - English

Are you making a payment with your federal tax return this year? If so, here are 10 important things the IRS wants you to know about correctly paying your federal income taxes.

1. Never send cash.

2. If you file electronically, you can file and pay in a single step with an electronic funds withdrawal. If you e-file by yourself you can use your tax preparation software to make the withdrawal. If you use a tax preparer to e-file, you can ask the preparer to make your tax payment electronically.

3. Whether you file a paper return or e-file your return, you can pay by phone or online with a credit or debit card. The company that processes your payment will charge a processing fee.

4. If you file Schedule A, Itemized Deductions, you may be able to deduct the credit or debit card processing fee on next year’s return. This is a miscellaneous itemized deduction subject to the 2 percent limit.

5. Electronic payment options provide another way to pay taxes by check or money order. You can make payments 24 hours a day, seven days a week. Visit IRS.gov and click on the ‘Payments’ tab near the top left of the home page for more details.

6. If you pay by check or money order, make sure it is payable to the “United States Treasury.”

7. Be sure to write your name, address and daytime phone number on the front of your payment. Also, write the tax year, form number you are filing and the first Social Security number listed on your tax return.

8. Complete Form 1040-V, Payment Voucher, and include it with your tax return and payment when mailing it to the IRS. Double-check the IRS mailing address. This will help the IRS process your payment accurately and efficiently. Go to IRS.gov to download and print this form.

9. Remember to enclose your payment with your return but do not staple it to any tax form.

10. For more information, call 800-829-4477 and select TeleTax Topic 158, Ensuring Proper Credit of Payments. You can also find out more in the Form 1040-V instructions available at IRS.gov.

Additional IRS Resources:

• IRS Free File
• E-file Options
• Electronic Payment Options Home Page
• Payments (payment options)
• Form 1040-V, Payment Voucher
• Tax Topic 158 - Ensuring Proper Credit of Payments

IRS YouTube Videos:

• IRS Tax Payment Options - English | Spanish | ASL

IRS Podcasts:

• IRS Tax Payment Options - English | Spanish

Adoption can create new families or expand existing ones. The expenses of adopting a child may also lower your federal tax. If you recently adopted or attempted to adopt a child, you may be eligible for a tax credit. You may also be eligible to exclude some of your income from tax. Here are ten things the IRS wants you to know about adoption tax benefits.

1. The maximum adoption tax credit and exclusion for 2012 is $12,650 per eligible child.

2. To be eligible, a child must generally be under 18 years old. There is an exception to this rule for children who are physically or mentally unable to care for themselves. 

3. For 2012, the tax credit is nonrefundable. This means that, while the credit may reduce your tax to zero, you cannot receive any additional amount in the form of a refund.

4. If your credit exceeds your tax, you may be able to carryforward the unused credit. This means that if you have an unused credit amount in 2012, you can use it to reduce your taxes for 2013. You can carryover an unused credit for up to five years or until you fully use the credit, whichever comes first.   

5. Use Form 8839, Qualified Adoption Expenses, to claim the adoption credit and exclusion. Although you cannot file your tax return with Form 8839 electronically, the IRS encourages you to use e-file software to prepare your return. E-file makes tax preparation easier and accurate. You can then print and mail your paper federal tax return to the IRS.

6. Adoption expenses must directly relate to the legal adoption of the child and they must be reasonable and necessary. Expenses that qualify include adoption fees, court costs, attorney fees and travel costs.

7. If you adopted an eligible U.S. child with special needs and the adoption is final, a special rule applies. You may be able to take the tax credit even if you did not pay any qualified adoption expenses. See the instructions for Form 8839 for more information about this rule.

8. If your employer has a written qualified adoption assistance program, you may be eligible to exclude some of your income from tax.

9. Depending on the adoption’s cost, you may be able to claim both the tax credit and the exclusion. However, you cannot claim both a credit and exclusion for the same expenses. This rule prevents you from claiming both tax benefits for the same expense.

10. The credit and exclusion are subject to income limitations. The limits may reduce or eliminate the amount you can claim depending on your income.

For more information, visit the IRS.gov website to see the Adoption Benefits FAQ page. Also, check out Form 8839 and its instructions. Both are available at IRS.gov or you can order the form by calling 800-TAX-FORM (800-829-3676).  

Additional IRS Resources:

• Adoption Benefits FAQs
• Form 8839, Qualified Adoption Expenses
• Adoption Tax Credit

WASHINGTON - The Internal Revenue Service today announced that its Office of Professional Responsibility (OPR) obtained the disbarment of Certified Public Accountant Anthony A. Tiongson for charging unconscionable fees, giving irresponsible advice to clients and making false statements to federal and state authorities, among other things.

Tiongson is prohibited from preparing tax returns or representing taxpayers before the Internal Revenue Service for a minimum of five years. Tiongson practiced in California.

“Practitioners who abuse the trust of their clients by charging unconscionable fees for taking frivolous positions on their tax returns can expect to hear from my office in the IRS," said Karen L. Hawkins, director of OPR

In a Final Agency Decision, the Administrative Law Judge (ALJ) disbarred Tiongson on March 1. The ALJ found that Tiongson’s advice to clients to use Form 2555 to treat California earned income as foreign source income on at least fifty-two tax returns, constituted disreputable conduct under Circular 230, and his failure to research the legitimacy of the filing position specifically violated the Circular’s due diligence standards.

The ALJ also found Circular 230 violations in Tiongson’s use of a contingent fee structure and in the false statement to IRS Criminal Investigation regarding his fee structure. He was also found to have made false claims to the California Board of Accountancy that he ceased advising use of Form 2555 after becoming aware of the first IRS examination of his clients’ returns.

The ALJ also found that Tiongson violated Circular 230 by engaging in a pattern of delaying IRS examination and collection actions by repeatedly raising numerous frivolous arguments, long-rejected by the IRS and by case law. Tiongson’s litigation threats against IRS employees, as part of client settlement proposals, were also determined to be violations.

"The mere possession of a professional license does not give a practitioner the right to make his or her own rules, or to threaten IRS personnel doing their jobs,” Hawkins said.

The ALJ found other violations of Circular 230 including: Tiongson did not respond to OPR requests for information and he submitted a Form 2848, Power of Attorney, naming an unlicensed individual as a second “authorized” representative in a collection matter thereby aiding an ineligible person to practice before the IRS.

Although the Decision was entered as a default judgment, Tiongson was represented by counsel during the proceedings. The text of the ALJ Decision can be found on IRS.gov.

WASHINGTON - The Internal Revenue Service is opening the nomination process for membership on the Electronic Tax Administration Advisory Committee (ETAAC). The deadline for submitting applications is April 1.

ETAAC was established as required by the Internal Revenue Service Restructuring and Reform Act of 1998. The purpose of the ETAAC is to provide continued input into the development and implementation of the agency’s strategy for electronic tax administration as well as to provide an organized public forum for the discussion of issues in electronic tax administration.

Nominations of qualified individuals may be made by letter and received from individuals or professional associations. A complete application package includes a nomination, ETAAC application, a short statement of interest and a resume. The application should describe and document the proposed member’s qualifications, past and current affiliations and/or dealings in electronic tax administration. A notice published in the Federal Register dated Feb. 14, 2013, contains more details about the ETAAC and the application process.

Members are approved by Treasury to serve three-year terms, beginning in the fall of 2013. Members must pass an IRS tax compliance check and Federal Bureau of Investigation (FBI) background investigation and may not be federally registered lobbyists.

Questions about the application process can be sent to etaac@irs.gov.