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TaxBuzz Chat: Tax Season Technical Challenges & Future Tax Policy

TaxBuzz Chat: Tax Season Technical Challenges & Future Tax Policy

Anyone else surprised it's September already? Our latest #TaxBuzzChat arrived with the start of the month and was one of the busiest this year. In this chat - hosted on our Twitter account @TaxBuzzOnline - we invited pros across the country to join us to discuss some of the technical challenges coming up in the next tax season, as well as where tax policy might be headed in the future.

Some of our key takeaways from the conversation included:

  • What's the most complicated issue in individual taxation? According to Brian Streig, CPA, "There are way too many complicated issues related to tax these days, but I think the biggest is dealing with the IRS notices and getting timely responses to info you send to them. It's unacceptable for them to send multiple notices w/o even opening their mail." - @cbriancpa
  • Clients are often confused by what tax refunds actually are. "A refund is, in most circumstances, a return of tax they have already paid. The tax liability can be the same and have a refund on one return and a balance due on another based on prepayments." - @TGorcz
  • With the TCJA set to sunset after 2025, pros are torn on what will happen to the temporary provisions in the Act. "Same as usual" is Eva Rosenberg's guess. "Some will get extended - about 6-9 months after the year ends, and be retroactive. Others will just fade away quietly." - @TaxMama
  • When it comes to which individual tax provision pros would change, many talked about employee expense deductions. "Reinstate the deduction for unreimbursed employee business expenses. Not every employee works for a large company that reimburses for everything. Even with the other tax cuts, many suffer from this #TCJA provision." - @PKubeyEA
  • Current proposals for infrastructure and budget bills are a hot topic these days. But is there anything pros are doing to mitigate any possible effects? "When it comes to potential tax changes, plan but don't panic. If it makes sense for your wealth plan and there is an intent to sell in the near future, perhaps sell now to lock in current capital gain rates." - @justinmilleresq
  • Many pros have a love/hate relationship with the FAQs from the IRS. "We should be able to rely on FAQ's and Instructions for taking positions on tax returns. PERIOD. If we can't rely on them, then what's the point?" - @fintaxdude
  • Everyone's favorite topic - the Sec. 199A pass-through deduction. Some proposed legislation would phase out this deduction at income between $400K and $500K, but most pros just want it to be simplified. "I'm not sure I understand the logic. If anything, make 199A must less complicated and help #taxtwitter out." - @wealthandlaw

Click on any of the embedded tweets to see the full set of responses on Twitter.

Q1. What do you consider the most complicated issue in individual taxation that you have to deal with? #TaxBuzzChat pic.twitter.com/RVdmf8Y7qX

Q2. What tax concept do your clients have the most difficulty understanding? #TaxBuzzChat pic.twitter.com/elnPxRdY7V

Q3. What complications do you see in the coming tax season related to the advance child tax credit? #TaxBuzzChat pic.twitter.com/7ijcId7QSB

Q4. TCJA sunsets after 2025. What do you expect will happen to all those temporary provisions in that Act? #TaxBuzzChat pic.twitter.com/vz97fovBNb

Q5. The IRS is encouraging taxpayers to get IP PINs. Do you think that is a good suggestion and how might more of your clients having an IP PIN impact your practice dealing with the new numbers each year? #TaxBuzzChat pic.twitter.com/c1OOtUUeA5

Q6. If you had the power to change, modify, or eliminate one individual tax provision, what would it be and why? #TaxBuzzChat pic.twitter.com/UKX36q5yEc

Q7. Tax law includes several provisions that are sometimes referred to as "Tax Traps." Which is your favorite (most egregious)? #TaxBuzzChat pic.twitter.com/Rx7Zn15S4c

Q8. What steps are you taking with your clients to mitigate the possible effects of the infrastructure and budget bills from a tax perspective? #TaxBuzzChat pic.twitter.com/hzsxn2HsKB

Q9. Dealing with the IRS last year and this year has been more frustrating than ever (unopened mail, long wait times when phoning, etc). Have you noticed any improvement in service as of late? #TaxBuzzChat pic.twitter.com/M2TI6iqtG0

Q10. One proposal that didn't make it into the Senate's infrastructure bill (but may be included in the budget bill) would require the IRS to increase enforcement to collect more tax dollars. Do you think this is a viable way to pay for some of the proposed spending? #TaxBuzzChat pic.twitter.com/2GDGyv1SrB

Q11. Compared to prior tax seasons, do you have more clients on an extension this year? If so, what is the main reason for that? #TaxBuzzChat pic.twitter.com/1CN1hAOIaO

Q12. Is the use of FAQs by the IRS the best way for the Service to impart information to taxpayers and tax professionals? If not, what would you suggest? #TaxBuzzChat pic.twitter.com/4qiMlHDhLP

Q13. Ron Wyden, D-OR, has proposed legislation to phase out the Sec. 199A pass-through deduction at income between $400K and $500K. What are your thoughts related to a phase out? #TaxBuzzChat pic.twitter.com/nmjLzLBlsY

Q14. Even though several states have legislated SALT workarounds for passthrough entities, do you believe the current Congress will overturn the SALT limitation? #TaxBuzzChat pic.twitter.com/t2SCzmuE3i

-- TaxBuzz.com (@taxbuzzonline) September 1, 2021

Thank you to all the members of the #TaxTwitter community who participated in our September chat - and welcome to all our new attendees. Make sure to check out the full recap below for top highlights of our conversation and sign up to receive our chat invites and recaps via email here.

@TaxBuzzOnline will be skipping the October #TaxBuzzChat due to the tax deadline. Check back for updates to make sure you don't miss out on our next conversation and Tweet us if there are topics that you'd like to chat about in the future.

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Lauren Detweiler

Lauren Detweiler

I am equal parts marketer, traveler, and writer, and I've been doing all three for as long as I can remember. I have spent most of my time since graduating university traveling and working remotely in Africa and Europe. My passion lies in conveying the right messaging to the right people, and being a part of the CountingWorks and TaxBuzz team means I get to do that not only for our company, but for clients across the country as well.

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