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What is the Internal Revenue Service (IRS)?

The Internal Revenue Service (IRS) is a government agency that collects taxes from the public. It also enforces tax law and provides taxpayer services, including help in preparing income tax returns. The IRS has been around since 1862 and it has many different departments: Taxpayer Advocate Service, Criminal Investigation Division, Exempt Organizations Office, Large Business and International Division. 

The IRS offers free tools to help you prepare your taxes such as forms for individuals or businesses, instructions on how to fill them out correctly and an interactive tool called TaxCaster which helps you estimate what your refund will be based on your earnings. But if you want to guarantee the correctness of filing your taxes, tax return experts can help; this will also save you from paying hefty penalties from the IRS.

The IRS business focus, responsibilities, and resources are divided into four major divisions.

  • Wage and Investment (W&I): This division is responsible for overseeing individual, business tax returns, including wages, interest income, dividends, capital gains, and losses. They also process the majority of refunds.
  • Small Business/Self-Employed (SB/SE): The SB/SE division assists small businesses and self-employed individuals in understanding their tax responsibilities.
  • Large Business & International (LB&I): The LB&I division is responsible for the auditing of large corporations, partnerships, and high net worth individuals. They also assist in ongoing compliance activities.
  • Compliance: This division has two branches: Return Delinquency and Processing (RDP) and Compliance Research (CR). RDP is responsible for processing paper tax returns. CR investigates possible non-compliance with the federal tax laws, and it conducts ongoing compliance research efforts to guide on a proper interpretation of the federal tax code.

Taxpayer Advocate Service

The Taxpayer Advocate Service (TAS) within the IRS assists taxpayers who are experiencing economic harm, are seeking help in resolving tax problems that have not been resolved through normal channels, or those who believe an IRS system or procedure is not working as it should. TAS also helps taxpayers resolve large-scale problems with the IRS and acts as a last resort for people who can’t get satisfaction from the IRS.

The mission of the Taxpayer Advocate Service (TAS) is to assist taxpayers in resolving their problems with the IRS, as well as identify potential systemic issues that may exist.

The Taxpayer Bill of Rights describes ten basic rights any taxpayer should expect when dealing with the IRS. These rights are:

  1. The right to be treated fairly, professionally and with respect.
  2. The right to receive clear and timely information about IRS rulings and the tax code, as well as to speak with a supervisor whenever quality service is not received.
  3. The right to appeal an IRS decision in an impartial, independent forum within the agency.
  4. The right to finality. Once a tax return is filed, the taxpayer has a right to be informed of the status of his/her tax return at least once every 60 days.
  5. The right to pay no more than the correct amount of tax. Taxpayers have the right to challenge an IRS claim for additional tax they believe is incorrect or excessive until it is resolved in their favor or they are sent a notice of deficiency.
  6. The right to an explanation for deficiencies upon request. Taxpayers have the right to receive, in understandable form, the information that was used as the basis for any adjustment made by the IRS to their tax accounts or tax returns.
  7. The right to confidentiality and privacy of all communications with TAS and the right to expect TAS to keep those communications confidential unless taxpayer authorization is obtained.
  8. The right to quality service from IRS employees. Taxpayers have the right to receive courteous, professional and timely assistance in their dealings with the IRS .
  9. The right to challenge an agency determination in an independent forum without fear of retaliation. Taxpayers may file a complaint with the Office of Appeals within the IRS to pursue an appeal.
  10. The right to finality for all tax returns. Taxpayers have the right to know when their original tax return will be considered final, which generally occurs on April 15 following the filing of that return.

A summary of what the IRS entails

The IRS is an independent bureau of the U.S. Treasury Department that provides many services to taxpayers and enforces federal tax law, regulations, and rules for all 50 states plus Puerto Rico, Guam, American Samoa, and the Virgin Islands of the United States (U.S.).

From their website it seems like they do a lot more than just collect taxes! They issue refunds or credits; research taxpayer’s accounts; enforce compliance with filing requirements; audit refund claims by other agencies such as state governments who administer unemployment insurance programs; investigate fraud and identity theft cases related to those areas; educate people about avoiding scams in these fields.

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