Quatloos!

In today’s Houston Chronicle (Monday, April 12, 2010, on page D4), the “Dear Abby” column includes Abby’s response to a lady whose boyfriend, by the name of “Grant,” has refused to file federal income tax returns for many years. Abby responds with some advice taken at least in part from the National Association of Enrolled Agents, which Abby refers to as “a professional society of federally licensed tax practitioners.” Abby suggests that Grant’s girlfriend try to get him to file his back tax returns. Included in Abby’s advice is the following statement:

More than 10,000 enrolled agents are listed. Because they are the only tax specialists licensed to practice before the IRS, Grant [the taxpayer] can be assured the matter will be handled confidentially in the most competent way.

Are there any enrolled agents here (or anybody else here) who can spot some errors in, or at least some misconceptions that might be conveyed by, Abby’s comments?

Famspear wrote:In today’s Houston Chronicle (Monday, April 12, 2010, on page D4), the “Dear Abby” column includes Abby’s response to a lady whose boyfriend, by the name of “Grant,” has refused to file federal income tax returns for many years. Abby responds with some advice taken at least in part from the National Association of Enrolled Agents, which Abby refers to as “a professional society of federally licensed tax practitioners.” Abby suggests that Grant’s girlfriend try to get him to file his back tax returns. Included in Abby’s advice is the following statement:

More than 10,000 enrolled agents are listed. Because they are the only tax specialists licensed to practice before the IRS, Grant [the taxpayer] can be assured the matter will be handled confidentially in the most competent way.

Are there any enrolled agents here (or anybody else here) who can spot some errors in, or at least some misconceptions that might be conveyed by, Abby’s comments?

CPAs and licensed attorneys can represent taxpayers before the IRS. Abby's implication is that "only" enrolled agents can practice before the IRS, although she merely states that they are the only ones "licensed" to practice.

Abby wrote:

More than 10,000 enrolled agents are listed. Because they are the only tax specialists licensed to practice before the IRS, Grant [the taxpayer] can be assured the matter will be handled confidentially in the most competent way.

Dezcad noted:

CPAs and licensed attorneys can represent taxpayers before the IRS. Abby's implication is that "only" enrolled agents can practice before the IRS, although she merely states that they are the only ones "licensed" to practice.

Yep.

The other thing is that Abby seems to conjure what almost amounts to a "causal" relationship between the desired result -- having the matter handled "confidentially" and in the "most competent way" (or at least obtaining assurance that this will be the result) with the putative "cause": the point that enrolled agents are "the only tax specialists licensed to practice before the IRS."

In reality, other practitioners (such as attorneys and certified public accountants) are aware (or should be aware) that anyone who prepares a federal income tax return for someone else, for pay, is bound by certain federal confidentiality rules. Indeed, with certain exceptions, it is a criminal offense under Internal Revenue Code section 7216 for any person "engaged in the business of preparing" federal income tax returns, or for any person who "for compensation prepares any such return," to knowingly or recklessly disclose any information furnished to him for, or in connection with, the preparation of any such return, or to use any such information for any other purpose, etc. (Misdemeanor -- up to one year in prison, or a $1,000 fine, or both, etc.)

Abby's wording almost seems to imply that because CPAs, attorneys, etc., are not federally licensed, they might somehow be less attentive to the confidentiality rules than are enrolled agents, or less competent than enrolled agents, or both.

I'm surprized that the lady trusted "Dear Abby" with the question, since it probably wouldn't be that difficult with the powerful programs available for Homeland Security to identify who Mr. Clueless is.

Let's say he walks into a CPA or tax attorney's office wanting to see what his best deal would be if he had all the numbers run by the professionals, and then decides what he is going to do. If he has made over a certain amount he is already a target of civil or criminal action. The federal guidelines for various levels of tax fraud and evasion rely on a good faith filing of taxes; it is then up to the government officials whether criminal penalties or jail time are appropriate.

CaptainKickback wrote:Did the writer to "Dear Abby" sign her letter, Doreen of Detroit?

Unfortunately, as we all know, Doreen of Detroit is actually just as "tax-law-compliance-evasive" as her PontificatingPrisonBoundPeterPartner......

Number Six wrote:I'm surprized that the lady trusted "Dear Abby" with the question, since it probably wouldn't be that difficult with the powerful programs available for Homeland Security to identify who Mr. Clueless is.

I'm not surprised at all. It is probable that Mr. Clueless either did not owe taxes or was probably due a refund for many of those years. We should probably thank him for giving free money to the government.

I know a fellow who had a regular job with a company with deductions taken out and substantial freelance work after hours. I warned him it would be a good think to file, and showed him the enforcement statistics. He filed before he was contacted by the IRS even after having been a non-filer for years, I think it cost him a few thousand, but I doubt he included all income from those years or paid sales taxes on the contract work. A good CPA can work wonders. You don't want to run afoul of the state tax people; they spend a dollar to make a dime and enjoy every minute of it.

Number Six wrote: You don't want to run afoul of the state tax people; they spend a dollar to make a dime and enjoy every minute of it.

We're not that bad. A dollar to collect 75 cents maybe.....