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Advice the Commissioner gave on August 29, was ignored
During the summer I went to the IRS Tax Forum in Las Vegas NV, and heard John Koskines, Commissioner for the IRS, speak. He asked Congress, and tax practitioners to encourage them, not to wait till December to pass tax legislation. But yet, here we are, December 1st, with major legislation, pending. Though the legislation is for the 2018 tax year, included will be changes to the 2017 tax year. The only question will be, how many, and how large will the changes be. Below are part of his remarks.
We are also keeping a close eye on any developments in Congress related to tax reform legislation, which could potentially affect the next filing season. I want to be clear: I’m not advocating any specific tax policy changes. Tax policy decisions are the domain of the Administration and Congress. The IRS’s focus is on administering the tax law. Therefore, we do have a great interest in trying to work with the tax writers on Capitol Hill to make sure any changes in tax policy are clear and as easy as possible for taxpayers and tax professionals to understand and to comply with.
We’re also watching tax reform closely because of the opportunity it may present to simplify the tax code. I’ve had people ask me whether the IRS might resist tax simplification. Actually, the opposite is true. No one would be more delighted with a simplified tax code than IRS employees. Their jobs would be made much easier if the tax code was less complicated.
I’ve also been encouraging Congress to give us as much lead time as possible on any tax changes that might be enacted. The smooth implementation of the PATH Act provisions shows how helpful it is to have plenty of advance warning on legislative changes rather than just a few weeks. It not only helps the IRS get its own systems ready, but also gives taxpayers and tax professionals time to understand and prepare for the changes.
Another concern we have relates to a group of expired tax provisions and whether Congress could act to renew them later this year. It’s a long list, and includes everything from tax deductions for tuition and mortgage insurance premiums to certain business depreciation provisions. As you may have heard previously, I have been urging lawmakers to make a decision about extenders as soon as possible. Ideally, that’s no later than the end of November. Why is that important? Making this decision as early as possible will provide certainty for millions of taxpayers and tax professionals who are affected by the various tax provisions. The uncertain fate of the extenders legislation raises a variety of challenges that touches everyone in the tax community.
For the software industry, they need time to update their products to be ready by early 2018. For the IRS, we need time, too. We need to review the tax law. We need to make the right programming changes and have adequate testing to ensure our processing systems are ready for the opening of tax season in January. We need time to program and test so our processing systems run smoothly for taxpayers and tax professionals like yourselves. As you’ve seen in the past, if the uncertainty over the extenders provisions remains too long – say into December – that creates questions about whether we need to postpone the opening of the filing season.
As you saw in years past, this could delay the start of processing of tax refunds for millions of taxpayers – and create additional burden on the tax community and tax preparers. So I will continue to urge members of Congress not to let this uncertainty continue.