Transcripts For CSPAN2 Fmr. IRS Commissioner Discusses Child

Transcripts For CSPAN2 Fmr. IRS Commissioner Discusses Child Earned Income Tax Credits 20220926

Through the senate, it would end up with the veto from joe bidens. Will leave this here and go live to former i had Us Commission expected to talk about ways to improve child earned income tax credit speaking at an event hosted by the Bipartisan Policy Center. Live coverage here on cspan2. I want to take the opportunity to acknowledge h r block, Robin Hood Foundation and with other support, research and dialogue today would not be possible. Todays event is probably virtual coffee encourage active participation via live stream. American families offset high cost of raising children and workers with lower moderate wages. They been extended multiple times is the backing of both parties given the track record of reducing poverty. We worked tirelessly the past few years around tax Credit Report and since our report last year that provide a roadmap for policy makers to permanently reform the ctc we focus on ways to improve uptick in administration. On behalf of my coauthor andrew and william and proud to release the Newest Research today the dives deeper into this issue of administration and offers concrete recommendations to consider. Significant dents, administered of barriers in a variety of factors including program complexity, widespread nonfiling, lack of awareness and benefits administered through the tax code and language barriers contribute to the incomplete makeup. Persistent levels of improper payments going to both programs and while some are broad, men are honest mistakes confused by the intricate rules. Approximately one in four dollars each year might either go to people ineligible to perceive more than they should by law which is often due to childrens helpful tax purposes governed by complicated regulation. Policymakers have responsibly too address these challenges. The reforms today could not only increase among eligible americans but combat and humanize the process at the same time. Among reforms, six include irs administrative capacity for social benefit programs and improve Customer Service and staffing and funding. Increasing coordination between all levels of government and private nonprofit sectors while streamlining state and local versions of both the atc. The Technology Resources people used to access Public Benefit programs, committee irs to certify and regulate tax preparers, modernizing public and eligibility requirements and data sharing practices between all levels of government, tax authorities and third parties specifically those with eligibility. Investing in irs Customer Service throughout this process including the income taxpayer clinics. We recognize its on the heels of debating these programs and the inflation protection act provided fundamental investment of 80 billion in additional funding for the irs. In this context we look forward to a robust discussion about the role of not only both parties of the executive and legislative branches, state and federal government and private nonprofit sectors who could Work Together to improve administration of the Child Tax Credit and earned income tax credit. Id like to turn over to a woman who knows what is like to wear all those hats. President and ceo of the National Economy Public Administration. Im honored to have you introduce our keynote speakers today. Thanks to everybody for joining us today. On the president and ceo of the National Academy of Public Administration and delighted to be here to promote the partnership between Academy Center and Governmental Partnership and Bipartisan Policy Center and to support their work on this important topic. For those of you who may not know center for Governmental Partnership academies resource into promoting improved government, munication and collaboration at and across all levels of government. Todays event is perfect example of that. Tax credit such as the Child Tax Credit and earned income tax credit are vital bipartisan mechanisms alleviating poverty in the united states. Despite the support from across the aisle many challenges keep credits from achieving full potential. The recommendations will ensure the credits are assessable to all equitably distribute it and managed from the administered of auditing perspective. To speak further on some challenges around the tax credits, i like to introduce don, and academy fellow and former commissioner of Internal Revenue services, dedicated lifelong Public Service spent over 45 years working to support Good Government across agencies in all levels of government. In addition to his time at the irs, he worked as the city administrator for district of columbia, Deputy Director for management at the office of management and budget and chairman of the board director. Thank you for being here today. Thanks for the introduction. A summary of my employment career in the public sector, im delighted to talk about these important programs. I would note that the start Bipartisan Policy Center report coming out today is a detailed d analysis recommendation i think everybody should look at. These are two critical programs people are aware of but designed encourage low and moderate income workers to work and reward work designed to be tax credit refunds tied to the money earned by the taxpayer and children they had. These are large programs, two of them together at the irs issuing 100 billing a year in credits and refunds. 1 billion here and there and then you are into real money. The challenge for the irs and the program, im going to take a drink of water here the challenges to get enrollment increased and at the same time make sure the right people are getting the right amount of payment. The report notes and irs has been working on for some years take up for one is large and 90 of eligibility for Child Tax Credit and family supply and 80 earned income tax credit eligible people apply but it leaves millions of eligible taxpayers who want to participate in these and taking advantage. One of the great ironies is these social welfare programs designed to combat poverty are administered by the Internal Revenue service most people of this service if it think about it at all recognizing it tax enforcement which is important the irs for trillion a year for the amount of what the government does across the board. Then people sometimes are familiar with the irs and other significant functions, Taxpayer Service trying to help taxpayers become complaint. If youre trying to be compliant, the irs is anxious to help you but most people dont think of the iris is a welfare organization. Recently the system is payments the iris paid out, the irs almost has the same amount of money is the Security Administration did with a smaller budget so its an important part of the irs operations and sure both the number of people applying, the percentage is as high as possible and its going to the right people in the right amount. Part of this program is it bipartisan in nature. People on both sides make reference they are income tax credit with the Poverty Program and i think that explains why even in the face of high improper payment ratios the Program Continues to receive bipartisan support. Improper payment ratio for the Child Tax Credit is about 14 , still high but more manageable. The earned income tax credit, the percentage is 24 and not all his being stolen was the reason people are somewhat comparable as when it does go to the right sector of the population, perhaps not the right people specifically in the right amounts, the iris has been focused on this trying to deal with it for some years on the general accountability high risk that doesnt help in every time i testified at various times id be asked about why we cant do better about it. Weve made progress in a lot of ways while i was commissioner and we were talking before we started one of the areas in which weve made progress dealing with Identity Theft and refund, we created the irs Publicprivate Partnership with tax preparers like h r block and others state Tax Commission is on theory irs couldnt deal with Identity Theft by itself so we had a working partnership called Security Summit and while i was commissioner, the percentage or number of victims of Identity Theft went down by over 60 and told the number now is down by over 80 so a lot of taxpayers embedded in a by that. We spent time to increase take particularly on the image income tax credit and make sure the right people at the right payments and we made almost no progress no matter what we did. I had a seminar bringing in a Government Accountability office and advocates and people who knew something about this, i challenge them to figure out what we could do for it particularly on improper payment. I said that they come up with Something Better than my suggestion . Reduce the statutes. At the end of the two days nobody had a better idea and part of the problem is its almost impossible to figure out how to apply for the credit to whom the credit should go. The statute understandably and appropriately tries to make sure the people taking care of the child get the credit but the problem is Everybody Knows these are public it family situations and a lot of times you have singleparent working and supporting the, grandparents and uncles, aunts, neighbors, a lot of people taking care of children who move around to some extent so it seems even if you try to semper fi how you figure it out, its going to be difficult and part of the reason sometimes with the same child they are taking care of that child for significant part of the year to my suggestion then and continues to be i dont think we are ever going to be able to sort through statutes how to allocate appropriately the credit so if youre married december 31, youre married the lawyer and file jointly, it is a matter when you got married during the year. Generally for a long time but if you take care of and have a child december 31, you get the payment and then you would let the family sort out whos putting in time or effort or Financial Support for the child and each family will be different and make their own judgment and determination but would make it easier for the taxpayers, prepares working with the taxpayers and certainly the irs if the standard were simplified significantly it would increase participation because part of the concern for people thinking about applying is the statute, they are concerned they may not get it right if they dont, they will be audited by the irs. Recently thanks to the decline in number of employees generally and in particular decline in the number of employees will to enter the phone, fewer than 20 of calls are answered and some estimates only 11 of the calls were answered so if you are a low income taxpayer and you want to call somebody to get help, the last couple of years have been impossible to get somebody so as noted, the irs has 8 billion provided in the next eight to ten years to make improvement across the board in one of the first places they were made was to hire more people to answer phones to answer the questions and i think that would help but also what happens is you have taxpayer low income particularly are going to preparers to get help and not going to h and r block, they will go to somebody who sets up shop in a parking lot or a relative who may or may not know anything about the earned income tax credit. We saw some preparers with signs saying ill get you a refund and a lot of times on prepared preparers with file for refund greater than the taxpayer was entitled to in the prepare would disappear if they would take this doesnt look right and the taxpayer was left on their own. So one thing the Bipartisan Policy Center recommended we recommended strongly as the irs began in authority to require mineral standards by all repairs. The regulation in the preparers is the question of making sure every year they demonstrate understanding and the basic rudiments of tax law particularly low income areas, they understand how to apply for the earned income tax credit clients and Child Tax Credit. If we could do that, i think would eliminate significant amounts of improper payments to the extent taxpayers have more confidence the person in a local Community Center knows what they are doing, they might be more willing to say ill take my chances. The way that i could go out that i am entitled to his credit. They are critical programs, 25 million or more americans benefit from these programs and support on both sides of the equation on the report notes and a short everyone is eligible and applies for them appropriately and we need to make sure as they apply improper payment is down and the system is made with the irs providing as much service as possible to the taxpayers you have and often times they come from their prepare will have a situation. Its almost impossible with the additional funding, i would hope we are about to see a significant change in that regard as well. We have a panel with a lot of different icons and perspectives so like everybody else, im delighted to see what they have to say about these important programs. Thank you for those insightful remarks. It is an honor to have you speak to us today. The former will will join us in a bit but for now i would like to bring in our panelists bring rich and diverse expenses with expertise. Practitioners and experts across the nonprofit sectors. First we have andy phillips, director of Agency Industry relations and tax services at h r block. Highly qualified team of experts, attorneys, cpa and enrolled agents who study h r block to support its network and tax preparation products. Next we have gabriela joined us from Houston Texas is a senior policy advisor for the office. She was part of the team that created the hairs county program that leveraged american plant on low income families access Free Tax Preparation Services benefit from the expanded ptc in 2021. Lets welcome rebecca thompson, Vice President of the Partnership Network building prosperity now where she needs effort to engage in diverse arrays of stakeholders that make up Prosperity Network at large. She previously had quotients in central and northeast florida that included a coalition of sites that prepared 20000 tax returns and northeast florida annually. I also want to work on physical, economic special present Colorado Public Health and child health program. She identifies implement strategies to improve stability and mobility colorado families including strategic state and Community Level partnership, Services Support economic wellbeing and improve outcomes. Thank you for joining us today and as a reminder, we encourage you to submit russians via live stream the live and engage with twitter handle at bp underscore bipartisan. Lets get right to it. The commissioner, former commissioner alluded to this and i did as well throughout the course of our research, one of the primary areas was the fact that the irs has been up for a number of years and we need new funding. The inflation protection act passed last month provides 80 billion in funding to address longstanding concerns over tax enforcement and Customer Service and Information Technology is the commissioner remarked. Now that we have policymakers focused on these services i was hoping you could speak to the funding and from your perspective the levers of government, where their resources should be directed in these administrations. Maybe andy we can start with you and then the remainder of our panelists. Thank you so much my fellow panelists commissioner for joining today and all the work that went into this, its a fantastic product. I think some others, all the others talk more, ill speak more tax and demonstration if you will. Starting with opportunities of the credit and modernizing the experience on the irs side. Its much more efficient and accurate for the irs and its much faster. When errors are discovered during this process, they can be addressed in the time their fashion every year, a large number of taxpayers have a tax return that would otherwise qualify for Electronic Filing but not able to do so because they experience reject from the irs. I want to talk about what we are doing today. With these claims for dependent, in opening remarks, that can be due to id theft in the independent. Confusion around the rules, it may logical filers to disagree about the outcome to claim that defendant. So let me go to what happens there. They are able to claim the defendant on their tax return for family related benefits and while electronically. Files are rejected and the

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