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Earlier this month (January 8, 2025), the National Taxpayer Advocate (Erin Collins) issued her annual report to Congress on the IRS' performance in key metrics like tax support. Unfortunately, there was not much good news.

If you are doing your utmost to be 1099 compliant and working to dial in your 1099 reporting for the New Year, then you should be busy right now. This extended 1099 Year-End filing prep process is the key time of the year when you should be validating your vendors and the payments made to them during 2024. The idea is to make it so that filing season goes as smoothly as possible. It is imperative that you do so if for no other reason than the IRS continues to be laser-focused on making sure 1099 reporters are doing their jobs right.

Late in June the Internal Revenue Service Electronic Tax Administration Advisory Committee (ETAAC) released its recommendations to Congress and the IRS regarding improving the IRS and how it handles filing matters. These recommendations are often followed, if not in the current year than in those that follow. Thus, it behooves those of you in Accounts Payable/Tax or as an independent CPA to stay on top of what the trends portended by guidance such as those issued by ETAAC. 

Today (June 26, 2024), the National Taxpayer Advocate (Erin Collins) issued her mid-year report to Congress on the IRS' performance in key metrics like tax support. Unfortunately, there was not much good news.

On May 2nd the IRS released their new strategic operating plan that, among other things, announces their enforcement priorities for the upcoming year. Based on this IRS guidance, it's fair to say that if you are in Accounts Payable or Tax at a medium-large sized institution then you will want to be extra careful in 2024.

Earlier in January the IRS announced new enforcement pushes for 2024. If you are in Accounts Payable or Tax at a medium-large sized organization or a CPA advising such an organization then please beware.

Yesterday (January 10, 2024), the National Taxpayer Advocate (Erin Collins) issued her annual report to Congress on the IRS' performance in key metrics like tax support. Unfortunately, there was not much good news.

During 2023 IRS employees answered only 35% of all calls received. For the full fiscal year, IRS employees answered 29% of all calls received. In particular, the report states that service for tax professionals was below average, with only 34% of calls answered in FY 2023. Those that actually had their call picked up only did so after onerous wait times:

We just spent the past two months reminding our readers, listeners, and subscribers of the dangerous liabilities that can arise from negative interactions with the IRS. These include things like CP2100 "B" Notices, IRS Form 972-CG Proposed Penalty Notices, and dealing with audits.

Last week the IRS announced the hire of 3,700 new employees specifically to target compliance (featuring 1099/1042-S related compliance in particular).

Worse yet, the IRS is specifically looking to hire experienced accountants. As we all know, the more relevant experience of a new hire then the quicker they can ramp up into becoming a formidable examiner. The IRS states that "the hiring will be for higher-graded revenue agents, which are specialized technical positions that generally focus on audits."

In June the IRS rolled out a new draft Form W-8EXP. This month's subscriber article goes into greater detail on that development. But it is expected to be only the first of many changes to come this summer and fall. It appears the IRS intends to update all Forms W-8 over the coming months as well as the Form 1042-S.

That's only part of the changes though (and this is the biggie) - the Form W-9 is apparently slated for a new version. Note that the W-9 has not been updated since October of 2018. That's a really long-time, folks! Changes are long overdue.