tigta_program_plan_fy09 by suchenfz


									                                                                            OIG Recovery Act Plan Overview
                                       OIG Name: Treasury Inspector General for Tax Administration (TIGTA)

                                                   In its oversight role of the IRS Recovery Act programs and activities, TIGTA will monitor and evaluate the IRS, in much the same manner that it
                                                   currently oversees tax administration, in general. To accomplish its goals for Recovery Act involvement, TIGTA will aggressively:
                                                   • account for IRS monies expended and pursue those who defraud the IRS;
                                                   • protect the interests of the American taxpayers;
                     OIG Broad Recovery Act Goals:
                                                   • hold accountable Government officials who are responsible for administering Recovery Act funds;
                                                   • serve as a deterrent to those who are inclined to victimize Federal agencies; and
                                                   • provide for an overall atmosphere of transparency.

                                                  TIGTA will continue our integrity briefing to IRS employees and managers, conduct presentations to taxpayer forums, and discuss tax
         OIG Broad Outreach Recovery Act Goals: adminsitration issues with the IRS Commisioner and his senior staff, the National Taxpayer Advocate, the IRS Oversight Board, and applicable
                                                Congressional Committees,
                                                Because of the unprecented nature of the Recovery Act, all IRS ARRA activities are deemed to be high risk. TIGTA will use the existing strategic
      OIG Recovery Act Risk Assessment Process:
                                                planning process to identify the appropriate oversight actions needed for specific IRS tax provisions.

                         OIG Recovery Act Funds: $7 million
      Expiration Date of OIG Recovery Act Funds: 2013
           FY 2009 OIG Non-Recovery Act Funds: $146,083,000

      Number of OIG Planned Recovery Act Hires: 9

       OIG Recovery Act Funds to be Allocated to
                                                 N/A - none awarded
              Purpose of Recovery Act Contracts: N/A - none awarded
     Types of Recovery Act Contracts Awarded to
                                                 N/A - none awarded

     Link to OIG FY 2009 Recovery Act Work Plan: http://www.treas.gov/tigta/recovery.shtml

Page 1 of Overview                                                                                                                                                       b2a687b3-2b44-4baf-bd1c-24f26455068c.xls
                                                                                                    OIG FY 2009 Recovery Act Work Plan

                                                                                                                                                                                                                                          Expected    Expected
                                                      Type of Review        Entity Performing
                                Agency Recovery Act                                                                                                                                                                                       Quarter in Quarter in Expected
                                                     (Administrative / Review (OIG Staff,
    Agency      Program Area     Funds Associated                                                     Project Title                            Background                                              Objective                           Which     which Final Number of
                                                    Financial, Eligibility,    Contractor,
                                  w/Program Area                                                                                                                                                                                          Work will Report will   Reports
                                                    Performance, Other)           Other)
                                                                                                                                                                                                                                            Start     be Issued

                                                                                                                                                                                  Determine if the IRS has correctly implemented
                                  $123 Million (total
                                                                                                                                                                                  the new First-Time Home Buyer legislation into tax
                Tax Provision    received by IRS for                                            Review of the 2009 Filing
      IRS                                                Performance           OIG Staff                                                                                          return processing systems by assessing the              Q3 FY 09      Q4 FY 09             1
               Implementation    implementation of                                                      Season
                                                                                                                                                                                  accuracy of returns processed with the new
                                   tax provisions)

                                                                                                                            For 2009 and 2010, the Recovery Act provides a        Whether changes to withholding will have
                                                                                                                            refundable tax credit of up to $400 for working       unintended negative effect on taxpayers; is the
                                                                                                                            individuals and $800 for working families. This tax   IRS providing adequate outreach to employers
                                                                                                                            credit would be calculated at a rate of 6.2% of       and taxpayers to ensure they know to adjust
                                  $123 Million (total
                                                                                                                            earned income, and would phase out for                withholding if the employees will exceed the
                Tax Provision    received by IRS for                                             Review of the Making
      IRS                                                Performance           OIG Staff                                    taxpayers with adjusted gross income in excess of     adjusted gross income limits or will otherwise be       Q3 FY 09      Q2 FY 10             2
               Implementation    implementation of                                                 Work Pay Credit
                                                                                                                            $75,000 ($150,000 for married couples filing          negatively affected; determine if provisions are
                                   tax provisions)
                                                                                                                            jointly). Taxpayers can receive this benefit          made for waiving estimated tax penalties if wage
                                                                                                                            through a reduction in the amount of income tax       earners do not qualify for the credit but had
                                                                                                                            that is withheld from their paychecks, or through     reduced withholding due to their employer's
                                                                                                                            claiming the credit on their tax returns.             implementation of the new rates

                                                                                                                          In previous legislation, Congress provided
                                                                                                                          taxpayers with a refundable tax credit that was
                                                                                                                          equivalent to an interest-free loan equal to 10
                                                                                                                          percent of the purchase of a home (up to $7,500)
                                                                                                                          by first-time home buyers. The provision applies
                                                                                                                                                                                  Determine what steps the IRS is taking to ensure
                                                                                                                          to homes purchased on or after April 9, 2008 and
                                                                                                                                                                                  taxpayers taking the credit qualify, or to identify
                                                                                                                          before July 1, 2009. Taxpayers receiving this tax
                                                                                                                                                                                  those who did qualify for the credit but fail to stay
                                                                                                                          credit are currently required to repay any amount
                                                                                                                                                                                  in their homes for three years after purchase;
                                                                                                                          received under this provision back to the
                                                                                                                                                                                  determine how the IRS is handling the change in
                                                                                                                          government over 15 years in equal installments or
                                  $123 Million (total                                                                                                                             the law to allow taxpayers purchasing homes in
                                                                                                                          if earlier when the home is sold. The credit
                Tax Provision    received by IRS for     Eligibility and                                                                                                          2009 and claiming the $7,500 repayable loan to
      IRS                                                                      OIG Staff                                  phases out for taxpayers with adjusted gross                                                                    Q3 FY 09      Q2 FY 10             2
               Implementation    implementation of       Performance                                                                                                              amend their 2008 tax returns to claim the
                                                                                                                          income in excess of $75,000 ($150,000 in the case
                                   tax provisions)                                                                                                                                refundable $8,000 credit, including whether the
                                                                                                                          of a joint return). The Recovery Act eliminates the
                                                                                                                                                                                  IRS will be able to process the influx of amended
                                                                                                                          repayment obligation for taxpayers that purchase
                                                                                                                                                                                  returns timely, what controls will be in place to
                                                                                                                          homes after January 1, 2009, increases the
                                                                                                                                                                                  identify questionable claims, and what
                                                                                                                          maximum value of the credit to $8,000, and
                                                                                                                                                                                  documentation the IRS will require to substantiate
                                                                                                                          removes the prohibition of financing by mortgage
                                                                                                                                                                                  the claims
                                                                                                                          revenue bonds, and extends the availability of the
                                                                                                                          credit for homes purchased after December 1,
                                                                                                 Review of IRS Efforts to 2009. The Recovery Act retains the credit
                                                                                                Identify Improper Claims recapture if the house is sold within three years of
                                                                                                   for the First-Time     purchase.
                                                                                                   Homebuyer Credit

Page 2 of Work Plan                                                                                                                                                                                                                              b2a687b3-2b44-4baf-bd1c-24f26455068c.xls
                                                                                                    OIG FY 2009 Recovery Act Work Plan

                                                                                                                        Under prior law, new operating losses may be
                                                                                                                        carried back to the two taxable years before the    Determine whether the IRS timely processes small
                                                                                                                        year that the loss arises and carried forward to    business net operating loss carryback claims filed
                                   $123 Million (total
                                                                                                                        each of the succeeding twenty taxable years after   by individual and business taxpayers and whether
                Tax Provision     received by IRS for
      IRS                                                  Performance           OIG Staff                              the year that the loss arises. For 2008, the        controls are in place to ensure that taxpayers         Q3 FY 09     Q4 FY 10             1
               Implementation     implementation of
                                                                                                                        Recovery Act extends the maximum carryback          making this election qualify; determine if effective
                                    tax provisions)
                                                                                                Review of Processing of period from two years to five years for small       corrective action was taken to help ensure
                                                                                                  Net Operating Loss    businesses with gross receipts of $15 million or    processing accuracy of the claim
                                                                                                      Carrybacks        less.

                                                                                                                                                                               Determine if controls are in place for
                                                                                                                                                                            administration and expansion of the Health
                                                                                                                                                                        Coverage Tax Credit under the ARRA. Specifically,
                                                                                                                                                                        we will evaluate the adequacy and completeness
               Internal Revenue                                                                                        The Recovery Act provided $80 million to the     of new requirements; the adequacy of the testing
                                                                                                 Review of the Health
                 Service Health                                                                                        Internal Revenue Service to implement the health   processes to ensure the system is available by
      IRS                             $80 Million          Performance           OIG Staff      Care Tax Credit System                                                                                                             Q3 FY 09     Q2 FY 10             1
                Care Tax Credit                                                                                        care tax credit. The funds are available through    January 2010; whether HCTC performance is
                Administration                                                                                         September 30, 2010.                              analyzed on a regular basis; whether the financial
                                                                                                                                                                            database system has the capacity to handle
                                                                                                                                                                        additional HCTC participants; and whether the IRS
                                                                                                                                                                             has the appropriate oversight to properly
                                                                                                                                                                                      implement the project.

                                   $123 Million (total                                             Review of the IRS    OMB implementing guidance required eight (8)
                                                                                                                                                                          Determine whether the IRS met the timely
                Tax Provision     received by IRS for     Administrative/                       Implementation of OMB   different levels of reporting necessary to meet
      IRS                                                                        OIG Staff                                                                                reporting requirements specified in Section 2.1 of       Q3 FY09      Q4 FY09              1
               Implementation     implementation of      Financial Reviews                         Implementation       accountability and transparency objectives of the
                                                                                                                                                                          the Implementing Guidance.
                                    tax provisions)                                                   Guidance          Recovery Act and the implementing guidnace.

 Type of Reviews
 Administrative/Financial Reviews - reviews of management administrative issues, management internal controls, or financial systems/processes
 Eligibility Reviews - reviews to determine if eligibility requiremetns were met for a given program
 Performance Reviews - reviews to determine the effectiveness of a given program
 Other Reviews - reviews that do not fit within the above categories

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