the 2017 Duncan Teaching Award Recipient earlier this month. As this powerhouse fellow Surly Subgroup blogger embarks upon her eighth fall with UK Law this recognition comes as no surprise for those of us who have had the good fortune of working with Professor Bird-Pollan on the many panels she organizes, populates, moderates, and participates in for various major conferences including Law & Society and the Southeastern Association of Law Schools. Continue reading “Congratulations University of Kentucky College of Law for Recognizing Professor Jennifer Bird-Pollan as …”
The American Law Institute (ALI) has just announced its newly elected members. The members who join ALI from across the country will bring their diverse backgrounds and areas of legal expertise to ALI’s work. Fifteen of the 45 new members are professors, sixteen are partners (or the equivalent) in law firms, seven are judges, six are in private industry, and one is a government legal advisor.
“One of the most exciting aspects of being President of the ALI is meeting some of today’s most important and inspiring legal minds as they are elected into The American Law Institute. I look forward to having the opportunity to work alongside these new members in continuing the ALI’s efforts in clarifying the law,” said ALI President Roberta Cooper Ramo. Continue reading “Congratulations to the Newly Elected Members of the American Law Institute!”
There are many wonderful reasons to be a member of the ABA – Section of Taxation, including the Tax Section’s commitment to pro bono and outreach especially its education efforts with its people and its purse to work on the front lines with less fortunate and vulnerable neighbors across America. I can say without hesitation the ABA not only talks the talk, but it walks the walk. Indeed we are partnering with the ABA Civil Rights and Social Justice Section to present a free webinar on October 24 during pro bono week 2016. Tax justice at its best. I am a proud ABA tax justice passion warrior, join us in our efforts to help others as it is the gift that keeps on giving … We can, do, and will make a difference in the lives of countless American families.
Individual Taxpayer Identification Number (ITIN) Holders Pay Over $45 Billion Annually in Federal, State, and Local Taxes
Among the many amazing opportunities I have had as a law professor at the University of Nevada, Las Vegas is continuing my work with immigrants on their tax issues. As I have written about at length unauthorized immigrants pay many tens of billions of dollars a year in taxes including federal (about 4.4 million ITIN tax returns were filed in 2015 paying over $23 billion including $18.1 in federal income taxes and $5.5 in self-employment taxes), state, and local income, property, sales, excise, etc. ($12 billion annually), and payroll taxes (about $12 billion a year in net Social Security and Medicare taxes for which they currently receive no current or future benefit).
Nevertheless, Congress continues to challenge this population with respect to their tax compliance. If you do not know what an ITIN is then this issue likely does not directly affect you … however if you want a quick education the National Immigration Law Center (NILC) has a great primer available in English and Spanish here. Since 1996, IRS has issued about 21 million ITINs although only about 5 million are currently being used. Congress had previously enacted legislation causing any ITIN not used for five years to expire. However, that legislation was not given a chance to be enforced, because Congress has been busy enacting more recent ITIN expiration legislation that supersedes the five year law.
THE CURRENT ITIN on my mind ISSUE
In the recently enacted PATH Act of 2015 (Protecting Americans from Tax Hikes), among other matters, all ITINs issued before 2013 will be expiring and have to be renewed. An ITIN issued after December 31, 2012, will remain valid unless the person to whom it was issued does not file a tax return—or is not included as a dependent on the return of another taxpayer—for three consecutive years.
Congress has phased-in the expiration of ITINS as follows:
IF THE ITIN WAS ISSUED THE ITIN EXPIRES ON
before January 1, 2008 January 1, 2017
in 2008 January 1, 2018
in 2009 or 2010 January 1, 2019
in 2011 or 2012 January 1, 2020
In an effort to streamline the process, the IRS is identifying the first wave of ITINs expiring on January 1, 2017 as ITINs with the middle digits of 78 or 79. The IRS will identify the respective middle digits for the second, third, and fourth waves of expirations in time.
HOW TO RENEW BEGINNING October 1, 2016
ITINs scheduled to expire as of January 1, 2017 (middle digits 78 or 79 or any ITIN not used on a tax return for the last three consecutive years (e.g., 2013, 2014, and 2015)), can be renewed using the newly revised for this purpose Form W7 (available here) also known as an Application for IRS Individual Taxpayer Identification Number. No tax return is required for a renewal application.
The application including all required original documents (e.g., passport) must be mailed to Internal Revenue Service, ITIN Operation, P.O. Box 149342, Austin, TX 78714-9342. The anticipated time that the IRS will take to renew or issue an ITIN outside of peak processing times (between January and April) has historically been about six weeks. However, in a recent press conference the IRS said that they would be sending 400,000 letters to ITIN holders with expiring ITNs so there could be a much longer waiting period. The National Taxpayer Advocate has written about the ITIN application backlog and bottleneck in her 2015 Report to Congress as Most Serious Problem Number 18.
Any original documents or certified copies submitted in support of an ITIN application are supposed to be returned within 65 days. Taxpayers who do not receive their original and certified documents within 65 days of mailing them to the IRS may call 1-800-908-9982 to check on their documents.
CERTIFIED ACCEPTANCE AGENTS Not surprisingly, many immigrants will not want to send original documents to the IRS. In lieu of sending original documentation, taxpayers may be eligible to use an IRS authorized Certified Acceptance Agent (CAA) or make an appointment at a designated IRS Taxpayer Assistance Center location. CAAs often charge a fee for services rendered although some of the large chains of retail tax preparation companies are advertising free ITIN renewal services. I would advise taxpayers to proceed with caution as there may be ancillary costs, charges, or fees. The Consumer Federation of America, among others including myself, have written about the high cost of tax assistance services for low-income taxpayers and the potential for consumer abuse including price gouging.
FAMILY ITIN APPLICATIONS The IRS will accept a Form W-7 renewal application from each member of a family if at least one of the family members listed on a tax return has an ITIN with the middle digits of 78 or 79. If one family member has middle digits 78 or 79, all family members who have an ITIN may submit a Form W-7 renewal application at the same time.
FINANCIAL CONSEQUENCES IF ITINs Are NOT Renewed
Until ITINs are renewed, returns with expired ITINs will be processed and treated as timely filed, but the returns will be processed without any exemptions and/or credits claimed and no refund will be paid. The taxpayer will receive a notice from the IRS explaining the delay in any refund and that ITINs must be renewed. Once ITINs are renewed, any exemptions and credits will be processed and any allowed refunds will be paid. If ITINs are not renewed, taxpayers may be subject to interest and penalties for any tax owed as a result of disallowed exemptions and credits.
HELP IS AVAILABLE
The more than 130 Low-Income Taxpayer Clinics across the country should be able to answer questions and point you in the right direction to get assistance. To find the contact information for a LITC in your area look at this user-friendly map and list in English and Spanish here.
Moreover, the NILC and other immigrant advocate groups and pro bono lawyers like myself are always here to lend a hand. On November 16th, UNLV will be hosting a Continuing Legal Education program titled “Everything You Need to Know About the NEW Taxpayer Identification Number (ITIN) Renewal Process” from 12:30 – 2:30 p.m. at William S. Boyd School of Law, Moot Court Room. Join us.
“Few topics in American society have more myths and stereotypes surrounding them than poverty, misconceptions that distort both our politics and our domestic policymaking.” Mark R. Rank
The U.S. Census Bureau of the Department of Commerce: Economics and Statistics Administration has released the 2015 poverty measures and the news is eye-poppingly good. The Supplemental Poverty Measure (SPM), the most comprehensive poverty measure, dropped one percent from 2014. Down from 15.3% to 14.3% — nevertheless more than Continue reading “2015 Poverty Measures Released: Antipoverty Relief Delivered through the IRC = EITC & CTC”
This issue of TT features a farewell from the exceptional outgoing ABA/Tax Section Chair , George C. Howell, III, Hunton & Williams LLP, Richmond, VA and a welcome from the enthusiastic and energetic incoming ABA/Tax Section Chair William H. Caudill, Norton Rose Fulbright LLP, Houston TX. I personally appreciate the focus and support both of these gentlemen have given, are giving, and will continue to give to the Tax Section’s pro bono and public service efforts as well as their commitment to diversity and inclusion. Thank you ABA – Tax Section for reaching out for a greater good!
Next, Professors Joe Bankman and James E. Maule engage in a thoughtful point-counterpoint discussion on the important issue of tax filing simplification.
The brilliant Jasper L. Cummings, Jr. in “Spending Without Appropriations: Who’s to Complain?” discusses the recent Affordable Care Act (ACA) decision of United States House of Representatives v. Burwell, 2016 U.S. Dist. LEXIS 62646 (D. D.C. 2016). In the decision, Judge Rosemary M. Collyer ruled that DHHS cannot pay insurance companies the costs they incur in reducing the “cost sharing” for some ACA insurance policy holders. The court enjoined further payments to the insurance companies for those costs, but stayed the injunction pending appeal, which surely will occur. In other words, the House of Representatives won.
On a lighter note, here is a new tax tune, titled OVDP (Offshore Voluntary Disclosure Program), by Robert S. Steinberg of Palmetto Bay, FL, sung to the tune of “Tonight,” by Leonard Bernstein & Stephen Sondheim, from West Side Story.
Finally, Tax Law Professors take note,
SEPTEMBER 6, 2016, the 16th Annual Law Student Tax Challenge begins so spread the word to your students near and far!
And there are even more treasures in the August issue of the Tax Times, but I will let you dig up those pearls of wisdom yourself! There is something for every tax professional in the ABA-TT.
The Center on Applied Feminism at the University of Baltimore School of Law seeks paper proposals for the Tenth Anniversary of the Feminist Legal Theory Conference. We hope you will join us for this exciting celebration on March 30-31, 2017.
By: Francine Lipman
There has not been a great deal of good news lately about underserved communities or the IRS. But today America received some great news about nine new Low-Income Taxpayer Clinics (LITCs) in underserved areas across America. Five of the nine are in law schools. Continue reading “IRS Announces More 2016 LITC Grants”
Tax Analysts’ announces 2016 student writing competition winners as follows:
Supervising Editor Professor of Law Linda Beale and her team of outstanding ABA – Tax Section editors, Anne Dunn and Isel Pizarro, and staff have put together an exceptional June 2016 issue of the digital Tax Times. Features include . . . Continue reading “Tax Times @ ABA Section of Taxation”