Christine Speidel

About Christine Speidel

Christine Speidel is Associate Professor and Director of the Federal Tax Clinic at Villanova University Charles Widger School of Law. Prior to her appointment at Villanova she practiced law at Vermont Legal Aid, Inc. At Vermont Legal Aid Christine directed the Vermont Low-Income Taxpayer Clinic and was a staff attorney for Vermont Legal Aid's Office of the Health Care Advocate.

Tax Compliance for Refugees: Free Training Aims to Fill Gap in Tax Assistance

The ABA Tax Section is co-sponsoring a free training on June 15 to prepare volunteers to provide tax preparation for first-year refugees. Volunteers with e-filing capabilities are particularly needed to help refugees file their first U.S. tax return correctly. “First year” tax returns are outside the scope of what FreeFile, VITA, and TCE sites can handle, due to their complexity. The unmet need for competent, free assistance with first-year returns has been clear for many years. Hopefully this training will lead to permanent tax preparation assistance projects for refugees nationwide.


The training will cover tax residency, elections, foreign account disclosure, economic impact payments, child tax credits, and other issues relating to tax compliance for people who arrived in the U.S. during 2021. Many kudos to Frank Agostino for coordinating the training and providing for 3 free IRS continuing education credits.


When: Wednesday, June 15, 2022, 1:30-4:30 PM ET

Where: Virtual

A flyer advertising the Tax Compliance for Refugees Training

The Limits of Community Property Relief When Spouses Split a Joint Business

We have not covered IRC 66(c) relief from community property taxation in detail on PT before.  Keith wrote about the 2018 case of U.S. v. Kraus, where the grant of personal relief under IRC 66 failed to lift the federal tax lien or prevent foreclosure of the lien. (Similar hurdles exist with IRC 6015.) We have also noted, in another post by Keith, that contesting the validity of a joint return is much more fraught in community property states, as it does not relieve the spouses of liability for each other’s income as it does in common law states. A December 2021 summary opinion by Judge Pugh, Wheeler v. Comm’r, provides an opportunity to further explore the limits of relief from community property taxation under IRC 66(c).

The Wheeler case caught my eye as I (with guest blogger Audrey Patten) finalized the updates to Robert Nadler’s classic book, A Practitioner’s Guide to Innocent Spouse Relief. In addition to updating the book generally, for the third edition we added new material including a chapter on community property states, with an overview of relief from community property taxation. For those wanting more detail, the Saltzman & Book treatise IRS Practice and Procedure has an excellent and thorough explanation at ¶ 7C.07.


Marriage and Divorce and a Jointly Owned Business

Ms. Wheeler and Mr. Turner resided in Texas during their marriage, during which they formed an S Corporation naming each spouse as a 50% shareholder. The opinion does not include many details about Ms. Wheeler’s involvement in the operation of the business, but she apparently performed work for the business including in 2015, the year at issue. The court finds that “Income reported on Schedule K-1, Shareholder’s Share of Income, Deductions, Credits, etc., from Turner Investments was included on petitioner’s joint return with Mr. Turner for the three years (2012-14) before the year in issue. She was also issued Forms W-2, Wage and Tax Statement, reporting income from Turner Investments in years before 2015 and during that year, and she signed several checks for Turner Investments in 2013.”

When the couple divorced in 2015, Mr. Turner was awarded the business, and by the end of September 2015, Ms. Wheeler was no longer a shareholder.

The divorce decree provided that each spouse would file an individual income tax return for 2015, and “that for calendar year 2015, each party shall indemnify and hold the other party and his or her property harmless from any tax liability associated with the reporting party’s individual tax return for that year unless the parties have agreed to allocate their tax liability in a manner different from that reflected on their returns.”

Tax Troubles

Ms. Wheeler reported her W-2 income from Turner Investments on her 2015 tax return, but she did not report any pass-through income from Schedule K-1, which listed her as a 37.44856% shareholder for that year. The IRS subsequently issued a Notice of Deficiency and Ms. Wheeler timely petitioned the Tax Court, where she raised spousal relief as an affirmative defense.

Ms. Wheeler apparently viewed the 2015 net income from Turner Investments as equitably belonging to Mr. Turner, and therefore she sought relief under section 66(c) from the operation of community property taxation. (Because no joint return was filed for 2015, section 6015 was not applicable.)

The Court notes that

Texas is a community property State, and under section 66, married couples who do not file joint tax returns “generally must report half of the total community income earned by the spouses during the taxable year” unless an exception applies. Sec. 1.66-1(a), Income Tax Regs.

This general rule can lead to harsh results, as it does not depend on how income is actually received and spent. For example, in Hiramanek v. Comm’r, T.C. Memo. 2011-280, a preschool teacher who suffered years of abuse at the hands of her spouse would have been responsible for taxes on half of his much higher income as a corporate finance director, absent relief from community property laws. The Wheeler Court explains that

Section 66 provides that under certain circumstances a taxpayer may be relieved of Federal income tax liability on community property income earned by a spouse. Section 66(c) offers two types of relief to a requesting spouse — “traditional” and “equitable”. Sec. 1.66-4, Income Tax Regs.

Traditional Relief under IRC 66(c)

Traditional relief from community property taxation under IRC 66(c) is similar in many ways to “traditional” innocent spouse relief under IRC 6015(b), but in some ways it is more limited. The Court in Wheeler summarizes the four requirements:

(i) The requesting spouse did not file a joint Federal income tax return for the taxable year for which he or she seeks relief;

(ii) The requesting spouse did not include in gross income for the taxable year an item of community income properly includible therein, which, under the rules contained in section 879(a), would be treated as the income of the nonrequesting spouse;

(iii) The requesting spouse establishes that he or she did not know of, and had no reason to know of, the item of community income; and

(iv) Taking into account all of the facts and circumstances, it is inequitable to include the item of community income in the requesting spouse’s individual gross income.

As with 6015(b), many traditional relief cases under section 66(c) hinge on knowledge. For example, in the Hiramanek case linked above, the requesting spouse was not entitled to traditional relief under section 66(c) because she knew that her husband had been employed during the tax year.

The Wheeler case is different, and it highlights one big distinction between section 6015(b) and traditional 66(c) relief. Here, the Court stops at the second condition, finding that the business income included in the SNOD would not be treated as income of Mr. Turner under the rules of IRC 879(a) (which in turn reference section 1402):

Under section 1402(a)(5)(A), gross income and deductions attributable to a jointly operated trade or business are treated as the gross income and deductions of each spouse on the basis of their respective distributive shares of the gross income and deductions. Therefore, the rules contained in section 879(a) treat income from Turner Investments, a jointly operated trade or business, as the income of petitioner and Mr. Turner on the basis of their respective distributive shares. The income from petitioner’s 37.44856% ownership of Turner Investments and reported on her 2015 Schedule K-1 would not be treated as income of a nonrequesting spouse, and she therefore does not satisfy section 1.66-4(a)(1)(ii), Income Tax Regs. We therefore hold that petitioner is not entitled to traditional relief under section 66(c).

Although that finding is enough to prevent traditional relief, the Court also addresses Ms. Wheeler’s arguments that she did not know about the income. As with 6015 cases, the knowledge factor does not require knowledge of the tax law, only knowledge of the activity that produced the income. Given the history of joint returns reporting Schedule K-1 income, the Court finds that Ms. Wheeler had ample reason to know of the income. Nails in the coffin are (a) a provision in the divorce decree giving each spouse the duty to furnish to the other any information requested to prepare the 2015 tax return, and (2) the fact that Ms. Wheeler hired a tax preparer.

Equitable Relief Also Fails

In addition to the traditional relief outlined above, Section 66(c) contains flush language providing for equitable relief:

Under procedures prescribed by the Secretary, if, taking into account all the facts and circumstances, it is inequitable to hold the individual liable for any unpaid tax or any deficiency (or any portion of either) attributable to any item for which relief is not available under the preceding sentence, the Secretary may relieve such individual of such liability.

The procedures governing equitable relief under section 66(c) are the same familiar procedures and factors that govern equitable relief under section 6015(f), set out in Rev. Proc. 2013-34. (Hooray for tax simplification!)

The Court starts and ends its equitable relief analysis with the threshold requirement that the liability be attributable to the nonrequesting spouse. The attribution rule is not absolute, however. The Court notes that the Rev. Proc. provides for five exceptions, “(a) attribution solely due to operation of community property law, (b) nominal ownership, (c) misappropriation of funds, (d) abuse, and (e) fraud committed by the nonrequesting spouse.” Also, as the revenue procedure is not binding on the Court, in some cases judges have found that relief is warranted under slightly different fact patterns not captured by the five enumerated exceptions. This occurred for example in the Boyle case, which Les discussed here.

The Court finds that Ms. Wheeler does not meet any of the exceptions, and as she seeks relief from her own income items, she does not qualify for equitable relief. The Court also addressed other facts that Ms. Wheeler raised.

Petitioner does not meet any of these exceptions because: (a) the Schedule K-1 income from Turner Investments is attributable to her under section 1366, not solely by the operation of community property law; (b) the Schedule K-1 is in her name, and she did not rebut the consequent presumption that the income is attributable to her; (c) her failure to claim estimated tax payments (and the IRS’ subsequent refund of those excess payments to Mr. Turner pursuant to section 6402 and section 1.6654-2(e)(5)(ii), Income Tax Regs.) does not constitute misappropriation of funds; (d) she filed an individual return and did not establish how any prior abuse by Mr. Turner would result in her inability to challenge the treatment of items on a return that she filed individually after her divorce was finalized and with the help of her own return preparer; and (e) she did not argue or establish that fraud is the reason for an erroneous item. Nor are we persuaded that her failure to claim the estimated tax payments and the subsequent refund to Mr. Turner provided sufficient ground for equitable relief independent of these factors. While the facts here are unfortunate, they were not unavoidable. We therefore hold that petitioner is not entitled to equitable relief under section 66(c).


The Wheeler case is not really about community property taxation, despite the petitioner’s attempt at framing it that way. It appears that the SNOD did not rely on the law of community property taxation to charge Ms. Wheeler with income that was received by her ex-husband during their marriage. Rather, the SNOD relied on the Schedule K-1 issued separately to Ms. Wheeler, and the deficiency would have been the same if the parties had lived in a common law state.

If Mr. Turner had been the sole shareholder of Turner Investments for all of 2015, and the IRS had attempted to charge Ms. Wheeler with half of his net business income under community property principles, the analysis (and potentially the result) would have been very different.

It seems likely that Ms. Wheeler misunderstood the tax implications of her divorce agreement. As the business had been awarded to Mr. Turner and transferred to him by the end of September, it seems quite realistic to me that an unsophisticated taxpayer would believe the net business income for 2015 should fall entirely to Mr. Turner. In his blog about the case, CPA Ed Zollars observes that such misunderstandings are common in his experience, and he notes the difficulties that tax preparers often have in convincing their clients of the need to report community income.

As is unfortunately the usual case, the parties failed to coordinate when filing their 2015 returns. This is understandable given the opinion’s mention of abuse, but it left Ms. Wheeler at a disadvantage. Mr. Turner initially only claimed half of the estimated payments made by the business for the first three quarters of 2015. If the parties had coordinated, Ms. Wheeler could have claimed the rest of the estimated payments. As Ms. Wheeler did not claim any of them, the IRS later refunded them to Mr. Turner prior to this case. Now she is stuck with the liability but gets no benefit from the estimated payments. Mr. Turner seems to have acted in accordance with the tax laws and the divorce decree; the problem was likely Ms. Wheeler’s (or her preparer’s) misunderstanding of the full impact of the divorce decree on her 2015 taxes. It is unfortunate that responsibility for taxes on the net business income was not explicitly addressed in the decree.

Facial Recognition Is No Longer Coming

The IRS announced this afternoon that it will move way from facial recognition to authenticate people creating online IRS accounts, and that it will develop an additional authentication process that does not rely on facial recognition.

The IRS announcement was followed by a news release from the Office of Senator Wyden, reproduced below.



To: Reporters and Editors 
From: Keith Chu, Office of Senate Finance Chair Ron Wyden, D-Ore. 
Date: February 7, 2022 
Re: IRS Plans to Transition Away from Facial Recognition 

Senate Finance Committee Chair Ron Wyden, D-Ore., today released the following statement after the Treasury Department informed his office it is in the process of transitioning away from using the private facial recognition service to verify accounts: 

“The Treasury Department has made the smart decision to direct the IRS to transition away from using the controversial verification service, as I requested earlier today” Wyden said.“I understand the transition process may take time, but I appreciate that the administration recognizes that privacy and security are not mutually exclusive and no one should be forced to submit to facial recognition to access critical government services.”  

Wyden asked the IRS to end its use of in a letter this morning. In recent weeks privacy and civil rights advocates have raised concerns about the IRS decision to use facial recognition software by private vendor to verify taxpayers’ accounts and access tax information online. The IRS does not require use of the system to e-file tax returns. However, users have reported hours-long waits to complete the verification process.

ABA Tax Section 2022 Virtual Midyear Meeting

This morning the ABA Section of Taxation kicks off its virtual midyear meeting with plenary addresses by two distinguished speakers, William Gale and Loretta Collins Argrett:

10:30 am– 12 pm ET
Opening Plenary Session (Non-CLE)

Speakers: William G. Gale, Co-director, Tax Policy Center; Loretta Collins Argrett, retired, US Justice Department, Tax Division

Gale will address issues of race and racism in public finance and economics. Argrett will revisit her incredible tax career, and discuss the recently launched Justice, Diversity, Equity, and Inclusion Fellowship, named in her honor.

Loretta Collins Argrett was previously featured in the U.S. Tax Court’s Tax Trailblazers series, which I highly recommend.

The week promises many excellent CLE programs. Keith is speaking at the Court Procedure & Practice session on Wednesday on Boechler v. Commissioner, alongside Bryan Camp, Amy Feinberg, and Kandyce Korotky. Les is speaking at the Individual and Family Taxation session on Friday on math error notices, alongside Aisha Servaty, Rochelle Hodes, and Josh Beck.

The full schedule of programming is here. The schedule at a glance gives an overview of committee programming. To register for the meeting, click here. Students attend free, and low-income taxpayer clinicians’ registration fee is discounted to just $25.

Supreme Court Agrees to Decide Whether the CDP Petition Filing Deadline Is Jurisdictional

Today the U.S. Supreme Court agreed to hear Boechler v. Commissioner of Internal Revenue, appealed from the Eighth Circuit. The question presented is

Whether the time limit in Section 6330(d)(1) is a jurisdictional requirement or a claim processing rule subject to equitable tolling.


This is an exciting development for those interested in tax procedure. We have discussed Boechler and the question of jurisdictional time limits often on Procedurally Taxing. Carl Smith blogged about the Eighth Circuit decision here. Carl explained,

In Boechler, P.C. v. Commissioner, 2020 U.S. App. LEXIS 23306, on July 24, [2020], the Eighth Circuit aligned itself with the Ninth Circuit in Duggan v. Commissioner, 879 F.3d 1029 (9th Cir. 2018), and held that, even considering recent Supreme Court case law that generally treats filing deadlines as not jurisdictional, the Collection Due Process (CDP) Tax Court filing deadline at section 6330(d)(1) is jurisdictional.  The majority predicated its holding on an exception that Congress may override the general rule by making a clear statement in the statute that Congress wants the filing deadline to be jurisdictional.  In ruling that Congress had made a clear enough statement in the CDP provision, the Boechler majority rejected the D.C. Circuit’s opinion in Myers v. Commissioner, 928 F.3d 1025 (D.C. Cir. 2019), holding that the similarly-worded Tax Court filing deadline at section 7623(b)(4) for whistleblower award actions is not jurisdictional.  A concurring judge in Boechler said she felt bound to agree with the majority because of prior Eighth Circuit precedent, but if she were presented with the issue without that precedent, she would hold the filing deadline not jurisdictional.

The petition for writ of certiorari emphasizes this clear circuit court split and urges the Court to resolve the matter. Boechler further argues:

Review is also warranted because the Eighth Circuit aligned itself with the wrong side of the split. This Court has made clear that statutory time limits are quintessential claim-processing rules presumptively subject to equitable tolling unless Congress has clearly indicated to the contrary. And Section 6330(d)(1) is not the “rare statute of limitations that can deprive a court of jurisdiction.” United States v. Kwai Fun Wong, 575 U.S. 402, 410 (2015).

The petition cites a line of important non-tax cases including Henderson v. Shinseki and Irwin v. Dept. of Veterans Affairs. As Kristin Hickman observed, the case presents yet another issue at the intersection of tax procedure with important administrative law doctrine. Carl Smith deserves credit as the architect of many of the arguments against strict jurisdictional limits in the Code, going back to the 2016 Tax Court loss in Guralnik.

The issue of jurisdictional time periods is undoubtedly important doctrinally, but it is also of great practical importance. Two amicus briefs, both with PT connections, supported the petition for certiorari. The Center for Taxpayer Rights, represented by the Tax Clinic at the Legal Services Center of Harvard, filed an amicus brief emphasizing the judicial resources consumed by the strict policing of jurisdictional time periods. Keith blogged about one recent example here. The Center’s brief also urges the Court to specifically rule on whether the CDP petition filing deadline is subject to equitable tolling, describing common circumstances and compelling cases in which taxpayers lost their right to judicial review. These include case of taxpayers being actively misled by IRS errors, taxpayers suffering misfortunes such as late-delivered and undelivered mail, and taxpayers who file timely in the wrong forum.

The second amicus brief was filed by the Villanova Federal Tax Clinic and the Seton Hall Center for Social Justice Impact Litigation Clinic, represented by pro bono counsel from Skadden Arps. This amicus brief makes two points. First, the clinics argue that treating section 6330(d)(1) as jurisdictional would undermine Congress’s intent in creating Collection Due Process as a check on IRS collection activity. Second, the brief emphasizes the disproportionate harm to low-income taxpayers effected by treating the filing deadline as jurisdictional.

We will be following the case closely.

Preview of This Week’s ABA Tax Section Virtual Fall Meeting

The ABA Section of Taxation kicked off its Fall Meeting virtually yesterday, with a plenary address by Thomas A. Barthold, Chief of Staff, Joint Committee on Taxation, followed by CLE programs from the Corporate Tax, Employee Benefits, State & Local Tax, and Transfer Pricing committees. A full week of programming follows, starting at 10:30 AM Eastern each day.

I will preview several sessions of interest in this post. The full program is available here, with the “schedule at a glance” here. To register, click here. (Registration is free for J.D. and LL.M. students, and $25 for LITC practitioners.)

Sessions are all held live, but registrants can also view sessions on replay – a major bonus of the virtual format for those of us who like to attend multiple committee meetings and for those with conflicting obligations.


The CLE sessions presented yesterday are already available for viewing, as is the plenary address, Rewriting the Internal Revenue Code in a Pandemic, presented by Thomas A. Barthold, Chief of Staff, Joint Committee on Taxation. Those curious about the budget reconciliation process, the Byrd rule, and what tax writing looks like on the ground will find it illuminating and thought-provoking. The plenary session also includes remarks by Julie Divola, Chair of the Tax Section, by Wells Hall, Chair-Elect, and by Caroline Ciraolo, Vice Chair of Membership, Diversity & Inclusion.  

Readers of this blog may be interested in the panels happening at the Administrative Practice, Individual & Family Taxation, Civil & Criminal Tax Penalties, Court Procedure & Practice, Diversity, Tax Collection, Bankruptcy and Workouts, and Teaching Tax Committees, as well as the Pro Bono and Tax Clinics Committee. There are too many excellent panels to highlight them all here. Several committees also offer informal networking events, and the week ends with the always excellent Women in Tax Forum. I encourage readers to check out the full program and the schedule at a glance.

The Civil & Criminal Tax Penalties committee offers two programs today, at 12:30 and 2:30 p.m. ET. Part One includes subcommittee reports on important developments, followed by a cutting-edge discussion evaluating taxpayers’ exposure from their participation in COVID relief programs. Part Two presents additional important developments, and a final panel on taxpayer privacy versus the public’s right to know at 3pm, at which PT contributor Nina Olson is speaking.

Taxpayer Privacy v. The Public’s Right to Know. In the wake of the Watergate scandal Congress substantially increased the statutory protections for taxpayer privacy, including imposing criminal penalties for various forms of unauthorized disclosure. At the same time, the First Amendment provides for freedom of the press and journalists are tasked with informing the public on matters of national import. Recently, high profile leaks of tax return information have led to blockbuster reports by ProPublica (on the tax strategies of high net-worth individuals) and the New York Times (on former President Trump’s tax returns), among others. This panel will explore what I.R.C. §§ 6103 and 7213 protect and prohibit, how these laws potentially interact with the First Amendment, how newsrooms think through the legal and ethical questions surrounding the publication of leaked or stolen information, and more.

Moderator: Benjamin Eisenstat, Caplin Drysdale, Washington, DC

Panelists: Jesse Eisinger, Senior Reporter & Editor, ProPublica, Washington, DC; Cara Griffith, President and CEO, Tax Analysts, Washington, DC; Nina Olson, Executive Director, Center for Taxpayer Rights, Washington, DC; Jenny Johnson Ware, McDermott Will & Emery, Chicago, IL

The Administrative Practice committee teams up with the Court Procedure & Practice committee to present three joint sessions tomorrow. The Current Developments program at 10:30 ET is sure to be of interest to PT readers. The second program at 12:30 p.m. ET concerns CIC Services, which PT has covered in many prior posts, several of which can be found here, with Les’s most recent post here. The third session focuses on John Doe Summonses and begins at 2:30 p.m. ET on Wednesday.

Current Developments. This panel will include a report from the Tax Court, as well as a discussion of significant IRS guidance and pending litigation.

Moderators: Kandyce Korotky, Covington & Burling LLP, Washington, DC; Michael J. Scarduzio, Jones Day, New York, NY

Panelists: The Honorable Emin Toro, U.S. Tax Court, Washington, DC; Richard G. Goldman, Deputy Associate Chief Counsel (Procedure & Administration) Office of Chief Counsel, IRS, Washington, DC; Natasha Goldvug, Department of Treasury, Washington, DC (Invited)

CIC Services, LLC v. Internal Revenue Service: Opening the Floodgates to Pre-Enforcement Tax Litigation? In a unanimous decision, the Supreme Court held that the Anti-Injunction Act’s bar on lawsuits for the purpose of restraining the assessment or collection of taxes did not bar a pre-enforcement challenge under the Administrative Procedure Act of an IRS reporting rule backed by tax penalties. This panel will discuss helpful background regarding the Anti-Injunction Act and Administrative Procedure Act; examine the facts of the case and key arguments presented to the Court by the parties and amici curiae; and debate the implications of the Court’s ruling for pre-enforcement lawsuits challenging the validity of Treasury and IRS rules and regulations.

Moderator: Antoinette Ellison, Jones Day, Atlanta, GA

Panelists: Bryan Camp, Texas Tech University School of Law, Lubbock, TX; Kristin Hickman, University of Minnesota Law School, Minneapolis, MN; David W. Foster, Skadden, Arps, Slate, Meagher & Flom LLP, Washington, DC; Gil Rothenberg, former Chief of the Justice Department Tax Division’s Appellate Section, Adjunct Professor of Law at American University’s Washington College of Law, Washington, DC

Also on Wednesday afternoon, Teaching Taxation presents an important program on promoting diversity, equity, and inclusion in tax at 12:30.

Promoting Diversity, Equity, and Inclusion in Tax: Ideas and Resources for Mentoring Diverse Students and Leading Discussions of DEI in Tax. (Recommended for Young Lawyers) “We will all profit from a more diverse, inclusive society, understanding, accommodating, even celebrating our differences, while pulling together for the common good.” Ruth Bader Ginsburg. “Diversity requires commitment. Achieving the superior performance diversity can produce needs further action − most notably, a commitment to develop a culture of inclusion. People do not just need to be different, they need to be fully involved and feel their voices are heard.” Alain Dehaze. This panel will document the need for greater diversity in the field of tax law − in practice and in Academia – and share ideas to promote this goal, with a focus on law students and recent law school graduates. The panelists will (1) provide information about existing programs to promote DEI in the tax profession, (2) discuss ways to build the tax profession pipeline, to recruit and retain diverse tax attorneys, and to provide strong platforms for professional success, and (3) solicit audience participation and ideas for new initiatives.

Moderator: Katie Pratt, Professor of Law and Sayre Macneil Fellow, LMU Loyola Law School Los Angeles

Panelists: Professor Alice Abreu, Honorable Nelson A. Diaz Professor of Law and Director, Temple Center for Tax Law and Public Policy, Temple University Beasley School of Law, Philadelphia, PA; Caroline D. Ciraolo, Kostelanetz & Fink, LLP, inaugural Vice Chair, Membership, Diversity, and Inclusion, Tax Section Council, ABA; Professor Steven Dean, Brooklyn Law School; Honorable Juan F. Vasquez, US Tax Court; Lany L. Villalobos, Kirkland & Ellis, LLP, Assistant Secretary, Tax Section Council, American Bar Association (2021-2022), Immediate Past-Chair, ABA Tax Section Diversity Committee

Wednesday afternoon’s programming continues with a Diversity Committee session on return preparer fraud at 2:30 p.m.

Protecting Vulnerable Taxpayers Against Tax Preparer Fraud. (Recommended for Young Lawyers) Many taxpayers turn to paid tax preparers to help them navigate the tax code and accurately prepare their tax returns each year. While most tax return preparers are qualified and professional, unscrupulous tax return preparers do exist and can cause financial hardship and legal problems for the taxpayers who hire them. This is especially true for low-income taxpayers and other vulnerable communities. This panel will provide a comprehensive discussion of tax return preparer fraud and how to help those who have been taken advantage of by unethical tax return preparers. Panelists will identify resources to report tax return preparer fraud and what options are available to taxpayers to help remedy the damage caused by the tax return preparer. Lastly, the panel will discuss regulation of tax return preparers and what steps the tax community can take to reduce the risk of tax return preparer fraud.

Moderator: Shahin Rahimi, Legal Aid Society of San Diego, San Diego, CA

Panelists: Hana M. Boruchov, Boruchov Gabovich & Associates PC, New York, NY; Omeed Firouzi, Philadelphia Legal Assistance, Philadelphia, PA; William Schmidt, Legal Aid of Western Missouri, Kansas City, MO; Patrick W. Thomas, Frost Brown Todd, Louisville, KY

The Pro Bono and Tax Clinics committee presents two programs on Thursday morning. The first panel highlights administrative barriers that often prevent low-income taxpayers from receiving tax benefits to which they are entitled. This discussion is extremely timely as Congress debates whether to extend advance CTC payments.  We have covered problems with the IRS identity verification program here and here. Nina Olson wrote about problems with customer service and return processing recently here.

The second panel on determining a taxpayer’s “last known address” under the Code is a topic that has also prompted many PT posts.

Barriers to Tax Benefits: Resolving ID Verification and Payment Delivery Issues. (Recommended for Young Lawyers) The CARES Act and American Rescue Plan Act expanded numerous important benefits for low-and-middle income individuals delivered through the tax code -for example, the Advance Child Tax Credit and the Recovery Rebate credits. This panel will discuss numerous barriers that have emerged in getting those payments to the rightful recipients including ID verification issues, payments to the unbanked, and working with incarcerated individuals and the housing insecure.

Moderator: Anthony Marqusee, Philadelphia Legal Assistance, Philadelphia, PA

Panelists: Laura Baek, IRS TAS, Washington, DC; Barbara Heggie, Low-Income Taxpayer Project, Concord, NH; Nanette Downing, Director of Identity Assurance, IRS, Washington, DC; Denise Davis, Director of Return Integrity Verification Program Management, Atlanta, GA

A Simple Question with a Complicated Answer: Determining a Taxpayer’s Last Known Address. (Recommended for Young Lawyers) Many IRS notices are required to be mailed to a taxpayer’s “last known address.” Failure of the IRS to properly mail such notices can carry profound consequences. Determining exactly what a taxpayer’s last known address should be, however, is increasingly contentious. This panel will review the regulatory and subregulatory guidance on what is required for a taxpayer to effectively change their address with the IRS. It will also discuss how the recent 3rd Circuit decision Gregory v. Commissioner and the online IRS “portals” may affect this area of law.

Moderator: Briana Fehringer, Partner at Anderson & Jahde, P.C., Littleton, CO

Panelists: Christopher Valvardi, IRS Office of Chief Counsel (P&A), Washington, DC; Audrey Patten, Harvard Legal Services Center, Jamaica Plain, MA

Speaking of IRS customer service, on Friday the Individual & Family Taxation Committee presents a two-part session featuring IRS Wage & Investment Commissioner Ken Corbin.

The Service of the Service: Interacting Now and in the Future. (Recommended for Young Lawyers) This two-part panel will examine the current state of IRS customer service and how technology may transform how the IRS interacts with taxpayers. Part one will focus on common scenarios that taxpayers, practitioners, and IRS personnel have faced with the continuing backlog of correspondence and return processing. The panel will focus on how practitioners have attempted, with varying degrees of success, to resolve these problems. It will bring together viewpoints from private practice, tax clinicians, the Taxpayer Advocate, and the IRS. Part two will focus on strategic IRS initiatives to use Artificial Intelligence (AI) and data analytics to automate core components of customer service – some already in testing. The panel will discuss the IRS’s concierge service initiative, which will be AI-driven with some IRS representative collateral support, and how the initiative interacts with the broader Taxpayer First Act implementation programs. The panel will explore issues of equity in accessing responsive service by different taxpayer populations.

Part One Panelists: Kenneth C. Corbin, Commissioner, Wage & Income Division, IRS, Atlanta, GA; Andrew VanSingel, Local Taxpayer Advocate, IRS, Chicago, IL; Olena Ruth, Ruth Tax Law, Denver, CO; W. Edward (Ted) Afield, Clinical Professor of Law and Director, Philip C. Cook Low Income Taxpayer Clinic, Georgia State University, Atlanta, GA

Part Two: Joshua Beck, Attorney Advisor, Taxpayer Advocate Service, Des Moines, IA; Leigh Osofsky, Professor of Law, University of North Carolina School of Law, Chapel Hill, NC; Joshua Blank, Professor of Law, University of California, Irvine School of Law, Irvine, CA; W. Edward (Ted) Afield, Clinical Professor of Law and Director, Philip C. Cook Low Income Taxpayer Clinic, Georgia State University, Atlanta, GA

Updates for ITIN Holders

Two issues have come up recently for ITIN holders that I’d like to flag. Thanks to Sarah Lora of the Lewis & Clark Low Income Taxpayer Clinic for prompting this post and providing much of the content.

1. Earlier this spring, NTA Erin Collins wrote a blog post highlighting the delays caused by the paper-filing requirement for ITIN seekers. This issue has gone on so long that I almost forgot it seems strange to people seeing it for the first time.

Taxpayers needing an ITIN may not file electronically.  They must always file a paper return, attaching the return to their ITIN application and mailing the package with supporting documents to the IRS ITIN unit. The IRS’s reasoning is that the attached tax return demonstrates the taxpayer’s need for an ITIN. Taxpayers needing an ITIN renewal fare slightly better: they may obtain the renewal prior to the filing season, which then allows for an e-filed return.  However, when taxpayers seek help with both filing their return and renewing their ITIN during the filing season, the renewal application must be attached to a paper tax return.


The requirement to paper file has resulted in extraordinary wait times for taxpayers needing ITINs for themselves or dependents.

During 2021 through March 27, the IRS had received over 150,000 ITIN applications, with over 125,000 submitted with a tax return. This number is expected to grow – in 2020, the IRS received over a million ITIN applications, including about 470,000 applications from new applicants, meaning they had to apply with a paper tax return if they did not meet one of the narrow exceptions. These taxpayers are facing a double-whammy this filing season – first, the delay in having an ITIN application processed and second, the delay in having a paper tax return processed. For the week ending March 27, 2021, ITIN applications submitted with a return were taking 25 business days on average just to be input into the system. During this same week, the ITIN unit started with inventory of almost 67,000 applications to be worked and ended with an inventory of over 74,000, reflecting a growing backlog.

The NTA points out that many ITIN holders have dependent children that qualify for the Child Tax Credit (CTC) or Recovery Rebate Credit, creating delayed refunds for those families most in need.

In the post, the NTA suggests that ITIN applicants should not be required to attach a tax return if they can prove a filing requirement some other way, for example by submitting wage documents from an employer. She notes that accepting ITIN applications throughout the year would “prevent unnecessary delays, encourage voluntary compliance, and reward these individuals for doing the right thing by filing U.S. tax returns.”

2. ITIN holders with children who qualify for the CTC are entitled to the advanced CTC. The implementation of this provision has come with some glitches.  First, the IRS computers were initially programed to disallow the AdvCTC if the taxpayer or spouse was an ITIN holder. This programing error prevented approximately 1.2 million families from receiving the first monthly advanced CTC payment in July.  Advocates raised the issue with the IRS, and it appears that the glitch has been fixed and these families should begin receiving their payments in August 2021. According to the IRS news release, these taxpayers will receive the full amount of their AdvCTC:

Such families who did not receive a July payment are receiving a monthly payment in August, which also includes a portion of the July payment. They will receive the remainder of the July payment in late August.

Finally, advocates recently flagged the issue that the ITIN unit may reject ITIN applications for individuals with qualifying children filing 2020 returns with no income, seeking the advanced CTC. There were several reports of both private and nonprofit Certified Acceptance Agents (CAAs) refusing to submit ITIN applications for these individuals.

Sarah Lora previously wrote a post here discussing the ITIN unit’s flawed policy of rejecting ITIN applications where the accompanying paper tax return does not show what the IRS deems a federal monetary tax benefit. This policy rejects a century of tax policy that provides favorable tax treatment to citizens Canada and Mexico, as Sarah argues in a Tax Notes State article here. Even though a 2020 return is the ticket to receiving the advanced CTC, the ITIN unit’s current policy of blindly looking at monetary federal tax benefits on the attached return before them could lead them to reject ITINs for 2020 $0 income returns, preventing children with social security numbers, the vast majority of which are U.S. Citizens, from receiving the advanced CTC.

Because of this ITIN policy, it is logical for CAAs to think they would be wasting their time submitting applications for nonfilers who have “only” a 2021 tax benefit. Legal services attorney Jen Burdick submitted the issue to TAS through the Systemic Advocacy Management System (SAMS). Happily, Jen reports that there is a workaround. According to the Systemic Advocacy employee with whom Jen corresponded, a nonfiler’s 2020 tax return should be processed and the ITIN issued if the Form 1040 shows “Rev. Proc. 2021-24” written at the top of the first page.

Revenue Procedure 2021-24 sets out procedures for nonfilers to file 2020 tax returns in order to obtain AdvCTC payments, and it mentions ITINs at § 4.03(4)(b). Hopefully the ITIN unit will process applications attached to such returns. Because of the delays described above, it is difficult to say whether the ITIN unit is aware of the special 2020 procedures. Please reach out to Sarah at if you find taxpayers facing an improper ITIN rejection.

The workaround is good news, but it is discouraging that it has not been publicized by the IRS. The IRS needs to get the word out to all CAAs, so taxpayers stop getting turned away and told to wait until the 2022 filing season. A crush of ITIN applications next spring is the last thing that the IRS or taxpayers need.

Treasury Commits to a Permanent and Accessible Simplified Filing Portal for Child Tax Credit Claimants

One of the main stumbling blocks to full distribution of advance child tax credit (AdvCTC) payments has been the relative inaccessibility of the online sign-up tool for individuals who don’t have a 2019 or 2020 tax return on file with the IRS. Today the Treasury Department announced major improvements to the sign-up tool:

Treasury is announcing its commitment — as part of the Administration’s efforts to extend the expanded CTC program — to create a permanent, multi-lingual, and mobile friendly sign-up tool to help more Americans who do not regularly file taxes to claim their CTC. Treasury will work with Congress to ensure the effort is fully resourced. The Administration will also work with Congress to provide the necessary funding for a multi-year effort — leveraging public sector and community-oriented solutions — to reach and sign up more families and children.

In the meantime, Treasury and the White House are announcing a new, mobile-friendly, bilingual sign-up tool created by Code for America — a civic technology non-profit — which will be available in the coming weeks. The Administration will make an all-of government effort to enroll eligible families in the CTC, while also supporting the type of outreach and assistance needed over the long-term to ensure the Child Tax Credit is lifting up all our nation’s children.


The “sign-up tool” functions as a simplified filing portal, creating a 2020 tax return which the IRS uses to calculate 2021 advance child tax credit payments pursuant to the American Rescue Plan Act. The inability to get a 2020 return “on file” has been a major source of frustration for some nonfilers with children. A more accessible portal will help, although it is just one piece of the puzzle. Individuals will still need help verifying their identity and resolving problems. Next to identity verification and return processing delays, the most common problem we hear from callers is submitting their information only to have it bounce back as someone else has already claimed them or their children on a tax return. But, improvements to the first step should surface these problems earlier.

The press release also includes information on payments made to date, and the impact that the payments are having:

…more than $15 billion were paid to families that include roughly 61 million eligible children in the second monthly payment of the expanded and newly-advanceable Child Tax Credit from the American Rescue Plan passed in March. The number of payments this month increased and cover an additional 1.6 million children. Eligible families received a payment of up to $300 per month for each child under age 6 and up to $250 per month for each child age 6 to 17.

This tax relief is having a real impact on the lives of America’s children. According to the Census Bureau’s Household Pulse Survey data released earlier this week, parents reported having less trouble covering the costs of food and other household expenses after receiving their first CTC payment. The share of families reporting that they sometimes or often did not have enough to eat in the past week dropped to the lowest percentage since the pandemic began. Parents are using their CTC payments to pay for basics for their kids. Roughly half of those who received a July CTC payment reported using it to pay for food and 1 in 4 spent some of their CTC on clothing.

Given the impact on child poverty that the payments appear to be having, the improvements to the simplified filing portal announced today may pave the way for Congress to extend advance CTC payments beyond 2021.