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Washington, D.C.—Senators from both sides of the aisle and the Treasury Inspector General for Tax Administration (TIGTA) today voiced concerns over a plan by the Internal Revenue Service (IRS) to sharply cut back its walk-in and telephone customer service operations during a hearing on the 2006 IRS budget.

President Colleen M. Kelley of the National Treasury Employees Union (NTEU) has warned that closing Taxpayer Assistance Centers (TACs) will result in reduced taxpayer education and compliance at a time when the gap between taxes owed and amounts paid has increased to upwards of $298 billion.

IRS Commissioner Mark Everson discussed the agency’s plan to close as many as 105 TACs and cut back its toll-free telephone service by 15 hours a week at the Senate Appropriations Subcommittee hearing. TACs are located nationwide and allow taxpayers to have face-to-face meetings with professional IRS employees who can assist taxpayers with tax law, tax return preparation, and account inquiry resolution.

“The IRS needs to balance customer service with its compliance and enforcement efforts,” said Sen. Christopher Bond (R-MO), chairman of the Transportation, Treasury and Housing and Urban Development Subcommittee. “I believe that most people who fail to comply with the tax code do so unintentionally because of its difficulty and complexity. Accurate and timely guidance from the Service is imperative to ensuring taxpayer compliance.”

Sen. Patty Murray (D-WA) added that a recent IRS survey found that 64 percent of taxpayers thought the agency should get more funding to provide taxpayer assistance in person and by telephone. “But it is precisely these types of services that the IRS wants to cut,” she said.

While the IRS has shown improvements in customer service, closing nearly a quarter of the 400 TACs nationwide “may disrupt the balance between customer service and enforcement,” Inspector General J. Russell George testified. TIGTA is also skeptical that the IRS has sufficient data to assess—and may have underestimated— the effect the TAC closings will have on customer service. What is also lacking in the study is taxpayer behavior, George said, and whether they will pursue other options for help, file improper returns, or worse, give up and not file taxes.

The inspector general further cautioned that while volunteer tax assistance centers provide a valuable service, they do not take the place of the professional guidance provided by IRS employees. He pointed to a recent study conducted by TIGTA that had 44 individuals anonymously visit volunteer centers for assistance with their taxes, resulting in 35 tax returns; each of those 35 returns was incorrectly filed.

Taxpayer Advocate Nina E. Olson, in written testimony, warned that “closing [TACs] at this time will irrevocably harm taxpayers” and will only result in an upsurge in taxpayer requests for assistance.

“It is clear to many that this is an unwise attack on those who provide assistance to taxpayers,” Kelley said, adding that NTEU “will continue to strongly oppose the proposal.”

NTEU is the largest independent federal union, representing some 150,000 employees in 30 agencies and departments, including some 98,000 in the IRS.