Follow up to Yesterday’s Post on Suspension of ASFR Program

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Longtime reader and frequent commenter Bob Kamman provides additional history and context for the ASFR suspension Carl Smith discussed yesterday. Les

This is not the first time the ASFR program has been halted, according to the September 11, 2017 report from TIGTA, “Trends In Compliance Activities Through FY 2016.” According to the report,

“IRS management halted ASFR issuances completely from September 2015 through May 2016 due to resource constraints and the assignment of resources to other collection activities that were deemed a higher priority. Although the ASFR is one of the IRS’s primary tools used to enforce filing compliance, the IRS reported in the FY 2016 Data Book that there were $542.8 million of additional assessments in FY 2016. This represents a substantial decline compared to the $6.7 billion of additional assessments that were reported for FY 2012.”

The program seems to be more effective at assessing, rather than collecting tax. The TIGTA report’s Figure 6 on Page 14 shows that more than 28% of unpaid assessments in FY 2016 are from ASFR/Section 6020(b) returns. That compares to about 29% of unpaid assessments from returns filed with a balance due.

The decline in ASFR assessments appears to be part of a five-year strategy:

“IRS officials attributed the significant decline in the CSCO TDAs [Compliance Services Collection Operations Taxpayer Delinquent Accounts] to the decline in Automated Substitute for Return assessments that are issued as part of the nonfiler program, which have decreased 86 percent since FY 2012.”

The TIGTA report (76 pages) is here

 

 

Leslie Book About Leslie Book

Professor Book is a Professor of Law at the Villanova University Charles Widger School of Law.

Comments

  1. I’m now beginning to wonder whether, when Weir said the ASFR program had been suspended, he was referring to the suspension in 2015-2016, not a current suspension in effect. He did not specify when the suspension he was talking about took place. I just reasonably assumed he was talking about a current suspension. Why mention a past one? Also, maybe Weir’s reference to a TIGTA report coming out shortly was the report that Bob cites that came out earlier this month, but Weir was just unaware that the report was already out.

    Regardless of whether the suspension is currently in effect, the 2015-2016 suspension indicates that the IRS sees stopping the ASRF program as a potential saving in these low-resource times. I would not be surprised that, even if the program were currently operating, the IRS might suspend it again in the near future to save money.

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