The Internal Revenue Service Tax Exempt & Government Entities (TE/GE) division, just like most of us, had to quickly figure out a way to function in the times of a pandemic. In 2020, the Internal Revenue Service had to move their workforce to a remote work environment, mostly homes, and adapt internal policies and processes while keeping service interruptions to a minimum. This new way of working is here to stay for at least some portion of 2021 and TE/GE feels confident that with the experience of the prior year it can focus on its mission without disruptions. The division laid out its main priorities for the new year in their annual program letter issued in November.
TE/GE summarized its 2021 priorities in six main points that are described below:
Strengthen Compliance Activities – the focus is on syndicated conservation easements and abusive charitable remainder annuity trusts, as well as private foundations and retirement pans as it relates to global high wealth area. TE/GE is using enhanced techniques to identify civil and criminal fraud, and to recommend criminal prosecution and/or civil penalties against taxpayers who evade the assessment or payment of tax.
Improve Operational Efficiencies – the focus is on improving efficiencies and internal controls within the division.
Maintain a Taxpayer-Focused Organization – expansion of e-filing services, including electronic determination letter applications. Development of additional online tools and resources to assist taxpayers with various issues.
Ensure Awareness and Collective Understanding – proactive communication with the communities to encourage compliance and to increase voluntary compliance.
Leverage Technology and Data Analytics – TE/GE continues to incorporate technology into their processes for efficiency and it appears to be the largest area of focus for the division. In 2021, TE/GE is planning to expand taxpayer digital communications efforts and use of robotic process automation. In addition, it will collaborate with Research Applied Analytics & Statistics to improve identification of issues with a high risk for noncompliance. TE/GE is partnering with Health and Human Services for Medicare and Medicaid to develop a systematic method to identify the universe of hospitals subject to Affordable Care Act review. TE/GE is using noncompliance research and data analytics to detect emerging issues. And lastly, the division will continue comparative data analysis of Form 990-N and 1023-EZ filings to identify trends and emerging issues.
Develop Our Workforce – continuing efforts with enhanced employee training and coaching, mentoring programs. In addition, in 2021 TE/GE plans to merge TE/GE Knowledge management into IRS Knowledge Management platform to encourage information sharing.
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Material discussed is meant for informational purposes only, and it is not to be construed as investment, tax, or legal advice. Please note that individual situations can vary. Therefore, this information should be relied upon when coordinated with individual professional advice.