AICPA Advocacy Results in Taxpayer Penalty Relief
As a result of AICPA advocacy, the Internal Revenue Service decided to waive the usual penalty (0.5% monthly penalty up to 25%) for late payment of income tax for those who have requested an extension and are filing one of the 31 tax forms that were delayed until March because of the last-minute tax law changes in the American Taxpayer Relief Act of 2012. It’s important to note, however, that the IRS still automatically assesses late payment penalties, and that clients should be warned to contact their CPA when they receive automatic assessment notices and demands for payment. Practitioners should be ready to respond to both the letter and any client questions.
In responding to the IRS letter, make sure to:
- Explain the taxpayer’s eligibility for relief.
- Identify which of the forms included with the return are eligible for relief.
- Refer to Notice 2013-24.
The AICPA identified this problem early in busy season, requesting that the IRS grant penalty relief for taxpayers due to the delay of forms, including commonly used forms for education credits and depreciation. AICPA was particularly concerned about the impact the delays had on the processing of partnerships, S corporations, C corporations and other business returns due on March 15. “In the future,” the AICPA letter to the IRS said, “we believe the IRS would benefit from closer consultation with the AICPA and other stakeholders about the government’s plans with respect to the timing of form releases.”
Communicate Your Value!
By George S. Willie, CPA, CGFM, CGMA
The AICPA’s successful advocacy on taxpayer penalty relief is an excellent example of the active role that CPAs play in continuously supporting their clients. Are your clients aware of the CPA profession’s strong relationship with IRS and other policy makers? Our penalty relief advocacy efforts helped taxpayers avoid penalties this year for reasons that were beyond their control. But the value of the CPA does not stop there. Do your potential and existing clients know how much they can save by partnering with a CPA?
Tax returns are fresh on the minds of clients and prospects right now. In fact, you will probably be working on extensions for many clients as the year progresses. Seize the moment and remind them of the value of working with a CPA and that you’re available year-round. Consider these ideas to use on your website, in your firm newsletter or through social media:
- Tax season may be behind us, but you’re still open for business and ready and willing to help clients. Considering all the tax law confusion this busy season, 2013 may be the year to expand client services and promote tax planning. Highlight client success stories regarding tax planning you’ve recently completed that has helped clients solve problems and minimize tax outlays. Invite clients to contact your office for more information.
- We all want to save money wherever possible. Remind clients of common deductions, new credits and items they should be tracking throughout the next year. Providing a weekly deduction tip on Twitter will definitely increase your followers!
- Use the client satisfaction survey in the AICPA Tax Practitioner’s Toolkit to find out what clients think of your practice and tune into the archived webinar “CPA: The Value of Articulating Your Value” to identify ways you communicate all that you do for clients.
Our profession has once again taken an active role in making positive change. Make sure your clients know about it and use this opportunity to promote the many positive changes you can make in their financial lives.
George S. Willie, CPA, CGFM, CGMA, the managing partner of Bert Smith & Co., is chairman of the AICPA PCPS Executive Committee.
Firm Spotlight - Butler and Company CPAs
A New Look for News & Views!
What’s the best way to deliver timely and valuable information to PCPS members in the shortest and easiest way possible? That’s the question the PCPS team has been studying as we geared up to introduce our exciting redesign this month. Our new look for News & Views is one example of our fresh take on member communications: Sharper, more concise, and better focused on the news and views from fellow practitioners. Check out this month’s The Practicing CPA and Small Firm Solutions, as well, to see more of our innovations in communications.