Taxable Talk

A couple of months ago the IRS announced that they were “retiring” Disclosure Authorization from IRS e-Services. For the laypeople who read this blog, this means that if you come to my office and we need to print a transcript and I do not currently have a Power of Attorney on file, we can’t immediately obtain a transcript. Instead, I can call the IRS and be put on hold (average hold time recently is about 45 minutes), I’ll then fax the completed POA to the IRS (average time to do this, about 15 minutes), and then within 72 hours I’ll obtain the transcripts. Alternatively, I can just fax the POA to the IRS CAF unit, and then within a promised three four days, the transcript will be entered into the IRS’s computer system. I’ll then be able to obtain the transcript. (If anyone believes that this standard won’t slip again–it already has once–I have a bridge to sell.)

As the NAEA said today, how can this be considered an improvement? Perhaps the IRS wants e-Services when it helps them, and not tax professionals. Of course, as I’ve noted before the loss of Disclosure Authorization will also impede the IRS: They will have more phone calls to handle, more paperwork to handle, etc.

In any case, the retirement is official:

There is a planned power outage scheduled this weekend from Saturday, Aug. 31 at 5 p.m. EDT through Tuesday, Sept. 3 at 12:00 p.m. All e-Services products, including the Transcript Delivery System, e-file Application, Registration, Disclosure Authorization, Electronic Account Resolution and TIN Matching will be unavailable during this time.

There will be several changes made to e-services while the system is unavailable including the retirement of Disclosure Authorization (DA) and Electronic Account Resolution (EAR) and TIN Matching reengineering. Additional information for TIN Matching Re-engineering is available on the e-services page under Tax Professionals.

As with any upgrade, users could experience intermittent downtime for the first few days following implementation. If you experience problems, you may contact the e-help Desk at 866-255-0654.

Good news for tax professionals. When I went to IRS e-services this morning, I was greeted by this message:

DA and EAR Retirement delayed by three weeks

The planned retirement of Disclosure Authorization and Electronic Account Resolution on August 11, 2013 has been delayed until September 2 while IRS completes the transition to our new web portal. DA and EAR users have an additional three weeks to use both electronic products. Once the portal transition work is complete, DA and EAR would then be retired as previously planned and will be unavailable for use.

So we have another three weeks, until September 2nd, when tax professionals can save the IRS money and time by entering Forms 2848 and 8821 ourselves in e-services.

Not to sound like a broken record, but if today is a vision of the future, boy, do I want the past.

I have another new client and needed to order transcripts. I called the IRS Practitioner Priority Service (PPS) and received (as usual) the good news that, “The average wait time is greater than 30 minutes.” For phone call #1, the wait time was 45 minutes. Unfortunately, in the middle of talking to the IRS representative, “Click.” I waited ten minutes to see if I’d get a phone call from her, but I didn’t, so I called back. The second wait time was 48 minutes.

(For the record, the first representative did call me back, about 15 minutes into the hold time of call #2. Her system crashed, and she apologized and noted that she couldn’t call back until it rebooted. I do not blame her, or the IRS, for that mishap–these things do happen.)

In today’s E@lert (from NAEA), in a section labeled “Knuckleheads in the News…Continued,” the NAEA notes that the IRS has not changed its mind on eliminating disclosure authorization (DA). Once DA is retired, I expect average hold times on calls to the PPS to average ten to fifteen minutes longer than today. Perhaps the IRS’s motto should be, “Onwards and Upwards into the 20th Century!”

The fallacy is the IRS stating that by allocating more resources to the CAF unit–and their wonderful alleged ten-day processing period for faxed authorizations (Tax Information Authorizations and Powers of Attorney)–the problem will be handled. That’s just not the case. What most practitioners will do is (a) fax the authorization to the CAF unit (which I did) and call the PPS to order the transcripts. I don’t want to wait the average ten days to obtain a transcript. Apparently, the IRS hasn’t considered this.

Perhaps the next retirement from the IRS will be the ability to fax Tax Information Authorizations and Powers of Attorney to the PPS. I probably shouldn’t have written that; given the IRS’s most recent actions, someone at the agency could believe that doing that would solve the problem….

So after the debacle on Tuesday I called back yesterday afternoon. The hold time was far better: 68 minutes. That’s almost a 7% improvement!

On the other hand, the representative I spoke with was quite helpful. Indeed, most of the individuals I’ve spoken with over the years at the Practitioner Priority Service do an excellent job. They are trying to help practitioners. The gentleman I dealt with on Tuesday was an exception (based on past experience).

Unfortunately, it appears that lengthy hold times may be here to stay. Yes, two phone calls aren’t a statistically significant sample size, but this appears to be a pattern. I’m hoping that this composite from Airplane! isn’t what tax professionals will be relating to in the future:

Today I needed to order a transcript for a client. I had a signed Form 8821 (Tax Information Authorization). I couldn’t enter the form electronically using Disclosure Authorization as I didn’t have past information for the taxpayer. So I faxed the form to the IRS CAF unit, and I called the Practitioner Priority Service (PPS) to order a transcript.

Problem #1: I was on hold for 1:13:30 before the IRS picked up the call. That’s one hour, thirteen minutes, and thirty seconds. Now, I was warned that the wait time would be over thirty minutes, but 73 minutes is a bit ridiculous for the IRS.

Long hold times have been routine at the IRS. I keep track of this, and my four most recent calls to the PPS have had hold times of 31 minutes, 34 minutes, 38 minutes, and today’s 73 minutes. (I was told on the three previous calls, “The average wait time is greater than fifteen minutes.”)

Problem #2: The representative I reached did not have a working computer. In other words, he could not help anyone who reached him. Given that situation, and the fact that this situation only impacted him, why in the world was he connected into the PPS?

Now, I understand that the IRS computers do crash, and in that case an individual IRS representative shouldn’t be removed from the system. However, what good was there of having my representative answering calls when there was about a 0% chance of him assisting anyone?

Problem #3: The representative either couldn’t or wouldn’t transfer me to someone who could assist me. I explained what I needed (ordering a transcript). Why couldn’t he transfer me either back into the queue or to the IRS representative sitting next to him? The only option I received was to call back later, after he helpfully told me that the problem was impacting only his computer. He did apologize for the long hold time, though….

The joy of this is that this will be the new face of the IRS come August 12th. That’s when I’ll be explaining to my clients that the IRS is literally an agency stuck in the 1950s.

Buried in this week’s “e-News for Tax Professionals” was the following story:

E-Services: Disclosure Authorization and Electronic Account Resolution Applications Retire in August
________________________________________
Due largely to low usage, the IRS will retire and remove the Disclosure Authorization (DA) and Electronic Account Resolution (EAR) applications from e-Services effective Aug. 11.

Last year, users submitted less than 10 percent of all disclosure authorizations through the DA application. Similarly, only three percent of all account-related issues came in through the EAR application.

In anticipation of this change, the IRS has increased the number of employees who process authorizations and has improved internal work processes to decrease the average processing time significantly from the current 10-day processing period.

The IRS will continue to explore better ways to reduce processing time and improve overall service to the users. However, current budget cuts will impact their dedicated resources to this program and they are working to determine the impact on processing time.

Once IRS removes the two applications, former DA users will need to complete Form 2848, Power of Attorney and Declaration of Representative, or Form 8821, Tax Information Authorizations, and mail or fax it to the appropriate IRS location listed on the form’s instructions. Please allow at least four days for the authorization to post to the IRS database before requesting a transcript through the Transcript Delivery System. Former EAR users should call the Practitioner Priority Service at 1-866-860-4259 for help resolving account-related issues.

The IRS continues to look for ways to improve its current processes and is exploring an improved electronic solution for DA and EAR in the future.

This is not a good decision by the IRS. As I noted in my earlier post on this, this decision will increase costs for the IRS. As for the supposed ten-day processing time, I’ve had occasions where it’s been four weeks for a POA to post. One POA had to be resubmitted three times (over three months) before it finally made its way into the system.

I know that the National Association of Enrolled Agents is expressing its displeasure to the NAEA; I expect the AICPA to do the same. As for whether the IRS will change its mind over this decision, I have no idea.