tv Washington Journal Nina Olson CSPAN February 25, 2019 11:13am-12:24pm EST
is a bad idea that will destroy 30,000 jobs in the united states for a german government owned company and a japanese billionaire company. we do not see why the german government or the japanese billionaire should seek to make money off of american jobs. that is with the merger will do. >> watch the communicators tonight at 8:00 eastern on c-span2. returning to the program's nina olson. she serves as the taxpayer advocate to the irs. remind our viewers about the role you serve. he national taxpayer advocacy position created by congress, i lead an organization called the taxpayer advocate service and we have been charged to help taxpayers solve their problems with the irs both specific problems they may have and also systemic problems,
things that affect groups of taxpayers, not just one individual taxpayer. host: was the shutdown a problem for the irs? ms. olson: huge problem, absolutely. having it happen in december going into january leading up into the filing season, anytime you lose five weeks of works, it is going to take you a year to 18 months, if that, to get back up to where you were. just all sorts of stuff backed up. a domino effect. host: did you say a year to 18 months? ms. olson: yes. aboute all been talking internally, that is what i believe it i do not have any hard and fast numbers but people are we working their plans what they expected to get done this year. you know, a real good example is just with my own employees. those early weeks in january is when the irs does filing season training of its employees. my employees are people that answer the phone etc. by not having employees there for those weeks, you open the
filing season on january 26. ok, we are back to work. but, um, we had to take employees off for two weeks of training. answering the phones when taxpayers are calling for the filing seasons and to have questions answered? i don't know how you get that back. you know, because that shows up and maybe people filed the return and they did not get their questions answered, so they get it wrong so that means downstream we have worked to correct. or do an audit. host: about 5 billion pieces of on process mail as of gender or 24. 87,000 amended returns, 80,000 responses -- unanswered questions to earned income tax credit. ms. olson: again, what the irs tries to do in december and january before the next filing season begins is really tidy up all the work it has not been able to get completely finalized from the prior year. those audits are important
an earned we foroze income tax credit, we are looking at the return for 2017 that was filed in 2018. if we get another return this year and we have not finished with the prior year audit, we are going to take a close look at the next year's return and then you're holding up years and years of return. for a taxpayer who might be entitled to that refund, the art income tax credit can go up to $6400 a year, refundable credit. $12,000. of that is that is a huge amount of money for somebody to wait a year or two. it is very frustrating for the irs. they do not want to be in this position. host: so, what would you tell people in the process of filing perhaps already filed, what is the best expectation for them as of right now? it olson: well, the irs says is doing really well on the phone spirit i have some concerns about the way they are calculating their numbers. you know, people who are expecting refundable credit like the earned income tax credit or
the american opportunity tax credit by law congress had said we can't issue refunds until february 15. they want to give us a chance to run those returns through the database of wage data, the w2's we get from employers. so, the irs, they are starting to run that to the fabric 15 is friday. so those returns are in the process, the refunds are being issued. i think that, you know, we are seeing an increase in calls to the identity theft line. we are seeing an increase in return sent to error resolution. that is not in the millions but it is in the hundreds of thousands. and what that -- that is almost like a 200% increase from the year before. what error resolution is, someone has done something wrong on the return, it is not aentity theft or fraud, but
human being has to look at the return. it may be they left office schedule a did not provide a key piece of information. that we expected an increase because of the tax reform, that people just make mistakes. hadnow from 1986, when we the last tax reform, that there was an increase of about 2% of these errors overall. 150 million individual returns is a minor statistic. but when i see a 200% increase in the returns that are going for error resolution, this time this year compared to last year, that is where i am getting concerned. what does that mean? are people confused? are they leaving things off? again, that is where the irs is going to have to move a human being from one place to look at these returns so we can get them back in and process them. there may be nothing wrong with a return but somebody has to look at it. host: nina olson is with us to
take your questions about issues concerning the irs, particular after the shutdown, filing or unrelated matters. if you file taxes, it is 2020-748-8000. if you've not file taxes, it is 748-8001. you can post your questions on her twitter speed @c-spanwj. you talked about person-to-person medication. avoidingis person-to-person conversations with taxpayers. it is not placing phone numbers on his correspondence. instead, pushing taxpayers to the internet to streamline and stall agreement." the streamline our installment agreements are going to be taxpayer favorable. instead of taking a financial information and figuring out how much they can afford to pay on a past-due debt, the me just say
congress has said clearly that we should not be collected for people who cannot pay their basic expresses like housing and food and utilities. so that is sort of the law. has created these figures that you look at family size and you look at figure out what the basic living expense is. then work out how much you can pay each month. instead of doing all this financial information which takes hours of time and, you know, let's just divide by six years, 72 months or 84 months. hatyou say, i can pay t amount a month, then fine, you are in an installment agreement. they're trying to push people online were all you have to do is do that math and agree and you are on an installment agreement. what we looked at was how many people who have agreed to make payments under the streamline installment agreement actually can't afford to make those
payments, their income is.below the basic living and it is 40% . 40% of the taxpayers cannot afford to pay the basic living expenses. then we looked further and we streamlinedese installment agreements, all those people who have income below their basic living expenses, how many of them defaulted, couldn't make the payments? and it is 39%, more than a 1/3. we said to the irs, you need to talk to people in collection. have thato conversation. you are creating harm for the taxpayer. and then another thing about that in this is something we identified in my annual report about the irs is dealing with people with economic hardship is tot using data a lot identify who they think are the bad actor or underreporting but it is, they are not doing data mining to help taxpayers. we created an ugly than they
could apply to the information we have on the taxpayer. and, before they start sending e collection notices, identify those taxpayers who might be at risk and put a little marker on the account. so, when you're about to send, you know, if you get a call in from that taxpayer and you're about to divide by 72, instead, have a few questions so you can see whether or not this taxpayer is really an economic hardship. we should not even be collecting against this taxpayer. has not, the irs adapted that yet but that is something i very much pushing this year. we will see whether they will do it or not. host: we will start with marcia in pennsylvania. you are on with nina olson. go ahead. caller: hello. are you thee? re? ms. olson: yes, hello. caller: i have been watching you and i got my refund 2.5 weeks ago and he said they cannot send it until the 15th.
ms. olson: that is only if you're claiming one of the refundable credits like the earned income tax credit or the american opportunity tax credit or refundable portion of the child tax credit. so, if you just had restraint -- a straight w2, but you are not claiming any of those refundable credits, then your refund would just go through the processing. host: from california, mike, who says he hasn't filed taxes yet. go ahead. caller: good morning. i'm a capa and a fan. i was calling with a tough question and that is the w4. a year ago, you were on c-span, and i knew we were in trouble when you mentioned that it took two hours for you to complete your own w4. there's all kinds of
problems, you know, the press is just going nuts. and it's, it's a form has caused almost a politicization, i didn 't say that word right. needs tothink the form be redesigned, maybe if you ask for a specific amount to be withheld because it has been very difficult for me to give people advice when you have 30 or 40 years of history working with these things. it's changed so radically, most people do not want to pay for someone to do a full tax projection. so, i'm just curious what you might have in terms of ideas. ms. olson: i really appreciate that call. is difficult form right now because in the past we had dependents, is inches and allowances, and the new law we got rid of the dependent
exception for a period of time. the form, i know what the folks at treasure were trying to do was really get it so a lot of people do not have big refunds coming back, but you could put money into the economy and have money to buy what you needed during the year. and capture more details like second jobs are the income of your spouses. but the problem with the form is, first of all, a lot of people do not want their curre nt employers, you have to give that form to your employer, we do not want your current employer to know that you've got a second job or that your s pouse. why did your employer need to know that information? then you get to the calculations. is that, you're sort of working off the old system but translating it into the new system. and it not only took me two hours last time, but it took me four attempts to get what i thought was my withholding correct. and i think i got it correct this year.
i'll do my taxes this weekend, so we will find out for sure. but, what we did find, like, on the online calculator you can use, you mentioned being able to say i want to withhold this amount for the whole year and divide by 26 weeks. there is no mechanism for that i paid theay in what i year before because i do not want a penalty. there was a lot of discussion about whether we would revise the w4 for 2019. that people could fill out thie newar to align with the system, and the irs made the decision with treasury not to do that revision, to work on the revision for 2020. after this filing season, and part of that is because we won't know what really happened in this filing season till this filing season is over. in some ways, looking at this
filing season as an experiment to learn from and then design a form to really reflect what we need to. gao has said that there will be 30 million taxpayers who are under withheld. and that's a real problem for the taxpayers. now, it may be they just get less than a refund. but there will be probably be more balance due taxpayers. if there are, that goes back to the phone lines, the balance due tax, the phone line for the toance due, people calling make payment arrangement, only about 16%, 18% of the calls are getting through to a live assistor. you see the ripple effect, 30 million people trying to get through on phone lines that already we cannot answer a call. that is not a pretty picture. so, that is where we are with the w4.
i'm really in a watch and learn mode. and i do support the irs's decision not to revise it this year because i think people do not need too many changes and we need to get it right. we'll have a lot more information at the end of this filing season about what getting it right means.. host: this is from indiana, eddie, go ahead. caller: good morning, sir. question i've had for years and i'm glad to see this lady on here. in 2000, the 2001, i can remember the irs being investigated for all the stuff they were doing. september 11 came and everything just seemed to disappear off that. ma'am, can you tell me what became of all that stuff? thank you. ms. olson: yes, sir. they were whole series of hearings in 1997 and 1998, and there was a commission to restructure the irs, that was an independent commission that congress chartered.
they issued a report. then there was a major taxpayer rights and irs reform bill called the irs restructuring and reform act of 1998. and that really mandated sweeping protections. strengtheneefed up, the office of the taxpayer advocate, my position was created in that law. years betweenthe 2000 and 2001 was winning irs wa -- when the irs was putting into effect the provisions of the law. i have been saying for a while that we need, you know, active oversight of the irs. not accusatory but really congress needs to step in and say what you doing here? i recommend one thing they did after the 1998 act which was every year have a joint hearing over the irs of the six
committees that really in congress that really deal with the irs, the senate finance committee the ways and means, , the oversight committees of the house and senate and the appropriations committee of the house and senate. they all got together and had this oversight hearing to see what the irs was doing as a result of all these recommendations. that stopped after five years and i recommended that we put back in place. and we could take a different topic. how is the irs treating people in collections? how is the irs conducting examinations and audits? how is it doing an taxpayer service? each year, you can have his oversight and tell us what you are doing and we will tell you whether we are happy with that or not and have other witnesses talk about it. that has not happened to hope springs eternal. . keep recommending it i think that kind of steady oversight, but constant oversight saying, what you doing?
we're hearing this. so, what is your explanation for that? is a very positive thing. steady, not all of a sudden we pay attention to something we go away for a while. host: carol is next in georgia. carol in georgia? hello? caller: hello? ms. olson: hello. host: i think we lost her. dee in connecticut. dee, good morning, go ahead. caller: i filed my taxes yesterday but my question is, someone told me native americans and other people do not pay taxes. i want to know if that is true. ms. olson: no, that's not true. they pay taxes like anybody else. there are things about the, the revenue from casinos and there are all sorts of special
provisions that may govern that and there are certainly some provisions where state, you know, there's state versus the sovereignty of the native american tribe. and those are definitely treaty issues and they are respected but yes, they file income taxes like anyone else. he talked about the w4 revamping. a revamping of the 1040. that's page one. that is paid two. how do we get to this? what you think of it? ms. olson: i think this came from the tax reform act were folks were saying that we need to to do is simplify the law to the point we can get return on a postcard. what was the irs was instructed was to eliminate, we had three forms, the 1040 ez, the 1040a and the 1040 the two pager. the irs was instructed to consolidate all of them into a 1040 simplify which meant there
were whole bunch of lines that disappeared in the created six new schedules. there is one scheduled a has three lines. so, you are killing a lot of trees when you print them out. they are new schedules you have to file in addition to your schedule a for itemized deduction and your schedule d for capital gains, all those forms still exist. the postcard, about 32% of taxpayers estimate based on 2016 data which was the most current we had at the time, can file just on the postcard. so, it clearly simplifies it for these folks. but there is another 68% of folks who will have to file one more schedule if not two or three more schedules depending on their circumstances. now, most people do stuff through software. so, it may be irrelevant to them
until they hit the print button to get a copy to put in their file. but it is, i think my concern is, people do not know what taxes, how they are taxed anyway. they have no clue of what part of the income they are taxed on. what they get to deduct, whether marginal tax rate is. they don't know any of that. and one of the things that the 1040 does it walks through the logic of the tax system. income, adjustments to income, deductions, to their tax. an additional taxes. i would prefer that we keep the 1040 for people like me, you know. so i don't have to file maybe three schedules in addition.
and have the 1040 simplify replacer the a and the ez. the 70% would be able to use the 1040, plus the regular schedules. i do not know based on the i do not know based on the filing season, what the irs and treasury will decide. i do not know based on the filing season, what the irs and treasury will decide. now the program is still in place for that iconic 1040. they did not have time last year to reprogram the system. there is still a chance to preserve the 1040 and keep the 1040 simplified for the 30% of taxpayers they can use it. that is a good thing. host: here is anne from arizona. caller: good morning.
my husband and i have filed our taxes and we stay organize throughout the year, so once we got our document assembled, we were delighted that the new short form only took us about 30 minutes to fill out. and we had reduced our withholding according to what we knew about our own personal tax situation. and did end up owing about $3000 but we had that put aside in savings, so there was no problem for us to send in the underpayment. also, we saved a tax filing fee because of the simplicity of doing our own taxes this year. i think it is a great thing. the only thing i found problematic were the worksheets attached to your social security calculation and one other
worksheet that seemed absolutely ridiculous to me, the way it took us all over the place to reach the bottom line. those to me should be simplified. ms. olson: was that worksheet you had social security and then you had other retirement income or something like that? caller: yes, one of them was so security and there was another one that was equally confusing. ms. olson: i think you are a perfect example, i do believe the 1040 simplify is the publication for those people they can use that form without having to do with all the other lines. you are a perfect example of somebody who really benefited from that. so, thank you for calling. that is why i am recommending that we keep that form, but we also keep the 1040 for someone like myself so i do not have to file three additional schedules
in addition to all my other schedules. i can put all my information on the 1040. host: cbs reporting that when it comes to the passage of the new tax laws people might be surprised when they find time to do their taxes one of the surprise? ms. olson: i think it's what this caller said, you think you have adjusted the withholding correctly but you might find you didn't. so many get refunds, 80% of our individual taxpayers or tax returns are refund returns. you know, we will all see what really happens. i think the economists would say it is a good thing if you do not get a refund because you are using the irs as a bank for an using the irs as a bank for an interest-free loan. i'm not an economist. i'm much more a pragmatist. and i look at what people do through their behavior and it is true, people use the irs as a bank. there have been studies to show what people do with their
refunds, they use them as a down payment on a new apartment or car, to go on a vacation. they use it as if it were a savings account, as if the money came in during the year, they would not save it, they would spend it. i'm like you really need to follow people's behavior rather than put some theory on top of them, but that's the theory, why it would be better to have a minimal refund and have the money during the year. host: from connecticut, this is karen for nina olson. karen from connecticut. go ahead. caller: hello? ms. olson: hello. caller: yes, hi. i don't do my taxes until after april 15 and the reason why is that someone has stolen our social security numbers and they have been putting in false, um, you know tax returns to collect our refunds. which we do not have refunds because we are scheduled c.
we have to pay quarterly but i stopped doing that. and it's been several years now i still have not been able to get a pin number. ms. olson: that is very disturbing you cannot get a pin. let me explain what an i.p. pin is. identity theft is a very serious issue, not just for taxes but for your own financial security. i'm so sorry that you had to experience this. and so, the irs created this method where once you went through the process of proving that you were the legitimate taxpayer, theoretically you could get what is called an i.p. pin, and that is an number in addition to your social security, you can put this pin on your return and when the irs sees your return coming in with your social and your pin, they know it is you. you are the legitimate taxpayer because you have proven it. that is why you're getting the pin.
i don't know why you are not able to get it. what i would suggest, you cannot get it this year, it is too late into the year but i would suggest you call the taxpayer advocate service. you know, you can go to taxpayer advocate.irs.gov and find a local advocate in your state. there is at least one in every state. congress has mandated that we have one office and everything -- have one in every single state. find out about the pin. the other thing is that the irs is rolling out on a pilot basis, that anyone, can get an i.p. pin. they were doing it in four states and the district columbia. but they are actually rolling it out to most states. you may actually be able to get an i.p. pin, even though you are not a victim of identity theft. if the pilot works, they are thinking about making it
available to anyone who calls up, even if you have not been a victim of identity theft. we recommended that back in, i don't know, 2009-2010, that they make it available to everyone. they are testing it now. change comes slow. but at least that is a good thing. i was just want to say, check with the taxpayer advocate about why you have not been able to get a pin, because it may be there is a marker that has not been put on your account that would allow you to get it and my folks can work that. so at least next year if not this year we can get it so that you can get a pin. host: from tyler, texas, this is c.r. caller: good morning. i wanted to call in and say thanks to president trump and the congress for passing this tax bill. i did my income tax early.
early part of february. we did just a standard deductions, which was last year was $15,200. this year was $26,600. last year they withheld $9000 on me. this year they only withheld $7425. we paid less, $2000 less in taxes. we receive back a little over $1000. thank you, president trump and congress. ms. olson: i think that one of the things i think is a positive thing is increasing the standard deduction, i mean, that is a simplification moved to have fewer people itemize. it does work both ways. the idea was that saves you from having to full out a schedule
and you may be one of the 30% better able to just work on the 1040 simplified. the postcard size. that is why i think we should retain it for that part of the population. host: a viewer on twitter says the new tax law has this incentivized home ownership. ms. olson: this is getting at the policy and i'm a tax administrator. so, i take the law as i find it. and that is what the irs does. i try to advocate for things i think create complexity for taxpayers, procedural complexity, administrative complexity for the irs where they torture taxpayers to get it right or something like that. and that's where i might get into recommendations for changing the law. i think that, you know, economist and others will debate whether you should be
incentivizing home ownership. what happens to the people who are renting? we are unique in the world. there are only a few taxi ministrations that give benefits for homeownership. but that's a uniquely united states provision. host: from florida, norman is next. caller: i have a question about -- last year, i got audited by the irs. and they sent it to my old address so i never got it. later on in the year, i got a bill from the irs. i had to request the audit notice which took two months. so, by the time that i got the audit notice in the mail, the audit was closed. so than i had to go into audit reconsideration. and in the meantime, i still have to do with this bill. the question is, how is irs able
to send audit not us to old address even though they have your new address? why don't they give you enough time to complete the audit and send in paperwork once you actually receive the new audit notice? ms. olson: that is a really good example of the kind of work that my people intervene in. the irs is required to send, you know, official notices to your what is called the last known address. that is what the law says. and the regulations and the court cases to find last known address, as the taxpayer had called it. irs has said my address has changed, the irs has a reasonable amount of time to get it in the system. but this is the 21st century and a reasonable time is 24 hours, and that is not the irs time, maybe a week. if you file an income tax return with a new address, that becomes the official last known address.
and it sounds like one system did not talk to the other and they sent your audit notice to whatever might have been the address on that return that they were auditing. and if they had sent an official notice to you, like a notice of deficiency, and that it was the wrong last known address. it is not a valid notice of deficiency. reach out to the taxpayer advocate so we can get collection activity and we can work with you to send your information to the irs and make sure they are looking at it and we are getting to the right results while we're stopping collection activity. you know, part of what, also brings this about. i wrote about this in the annual report are our own ancient i.t. systems. the core systems of the taxpayer, for example, where your addresses record is kept our in 1960's technology.
and we pretty much can update them only once a week. i don't want to get too technical because i am not a technical person but they are flat file, which means you cannot, like, twist and do stuff to the data. there are all these other systems that we have to contain taxpayer data. there's an audit system and a collection system and mini collection system. and they all work out there and then you post to this main file pieces of information. a person in one system and addresses change, theoretically this is supposed to update the main system the audit system is looking at but it may not have or the audit system may notable that information off. you are a classic case of what happens, the real harm that happened to taxpayers because of our ancient i.t. systems. what we recommended and it is a hard sell but what we recommended this year is was our
number one legislative recommendations that congress give me irs a five year funding appropriation to really replace these 1960's systems that are holding us back, harming taxpayers, creating work for the irs. you know, i talked earlier about oversight. you can't just give the irs a blank check. you need to have an independent third party. look at what the irs is proposing to do and tell congress whether it makes sense in every single year and that appropriation does that review so that irs doesn't get that money into an independent third party, an expert has said they are on track are they missed something that they have adjusted. now they are on track. a, we are not giving them a blank check. but we have to get over the system or otherwise there will be more problems like you experienced but even more serious. host: gary from florida.
good morning. i'm sorry, ron from florida. go ahead. caller: i've already filed my taxes. in it was simple this year. compared to the years before. actually, i got back a lot more than i did. i had it all squared away where i got maybe back $100. this year was quite a bit more. we are right at about $100,000, so we have got that standard deduction at our house is paid for, we do not do the itemization anymore. it was a real good benefit for us this year. ms. olson: you are squarely in that place where the 1040 simplified and the standard deduction really help. host: from michigan, eva, hello. caller: i'm a retired educator. before the state of michigan
offered to retirees long-term care policies, i bought one from a private company. and last year, they said it wasn't tax deductible. i filed a form with it. and no one at the internal revenue service could really tell me about that long term insurance policy that i bought. and i filed all kinds of different forms. where can i get some information about it? ms. olson: well, let me give you, i'm actually going to do this. let me give you my email address and you can email me. don't send me your social security number. we will try to get an answer for you.
oh my email address is email@example.com. you know, i have given my email address out before. and people respect like they don't, 20 million people do not email me, which is good because it would crash the system. but if you have an issue you can certainly do that. firstname.lastname@example.org. you know, if you have a tax problem, you know like the person calling in about the audit, the best thing to do there is to look up for your local taxpayer advocate office because they will assign a case advocate to your case. i should say, what happens which is different from the irs is when you come to the taxpayer advocate service because you have something the irs is doing is creating economic harm or you have got a problem, you have tried to solve the problem through normal channels, and you
can't quite get it resolved. those of the things you should come to the taxpayer advocate service for. we assign one case advocate to your case. you will have a toll-free number advocate's phone. rather than being shuffled between multiple people, you have one person assigned to your case to work your issue from start to finish. and we'll also work related issues, if you go through the audit and you owe some money, and we will work with you to do with the collection issues to get you into an installment agreement you can afford to pay. host: allen in iowa. hi, there. you are on with nina olson. caller: good morning, nina. a few years ago, irs decided they would take gambling losses from the front of the 1040 and put them on the schedule a.
so, if you, uh, win some money, you used to be able to deduct your losses right on the front of the 1040. now you have to go to the schedule a. so, if you do that, you find that if you cannot file a schedule a, you lost, you could not have your gambling losses. and when you go over to social security and you sign up for medicare part b, they use the adjusted gross income as if you were a rich, rich man, instead of your income. since every state now has gambling almost, millions and millions and millions of americans are being screwed every day by this new format, by the format prior to this new one. when the new one came out, they did not do anything about it.
it is still the same thing. ms. olson: let me make this clear. the irs didn't do that on its own whim. congress change the law. that's an important point. the irs administers the law that congress passes and the president signed. so, several years ago congress changed the law to say we are going to treat gambling losses as itemized deductions. so, before, they had it as an adjustment to income and you are correct. you did not need to itemize. the congress changed the law. then the irs has to follow the law. so, that is why they moved into the itemized deduction schedule because it is the law of the land that it is treated as an itemized deduction. i think you make a good point about how the tax law intersects all sorts of other parts of people lives. people are looking at that adjusted gross income level number which should reflect the
taxpayer's ability to pay but because of the way the law is, , it may not. then that ties into such security and it may tie into other benefits and it may tie into scholarship aid, if your children are going to higher education or you are trying to get loans. so, it has an impact across the board. host: with all the changes that have taken place over the last years tax software, is it , up-to-date? ms. olson: i don't know. the irs, we haven't really gotten many complaints about it, but that is something i monitor. there are a lot of products out there. because of the changes to the forms the irs was late in the cycle of getting that information out to the software companies. i did hear report that one person had tried, this a sample of one, but person had tried to use software to file the new deduction for small businesses, the 20% deduction. that return was rejected
electronically because they had not included a form. i don't know whether that was because they did not answer the q&a on the software correctly or did that software not have that form attached? i'm monitoring that to see what some of the challenges are. host: host: this is from pennsylvania. linda, you're on. caller: hi, good morning. thanks for taking my call. first off, i do not have internet access. i am home bound. my income for one year is $18,000. and, of course, medicare is deducted. for the past three years, i have been going to a tax site where the aarp volunteers help to fill out the forms. and for the past three years, i have been told that i do not need to file a federal or state tax return.
i don't know about local. but they said the only reason from you would be in case i get audited. but my income is very low. it does not change unless we get -- that isn't going to happen very often. am i being told the correct information? do i have to file a local tax return? ms. olson: is your income from social security? caller: yes. i have social security and a small pension. that totals about $18,000 a year. ms. olson: so, social security is not taxable if your income is below a certain amount. then 80% of social security is taxable. your small pension is not enough to trigger taxability of social security.
they increase to the standard deduction. so your standard deduction is actually more than what would be your taxable income from your small pension. you are not going to be audited -- i can't say that. the likelihood is very minimal because you've got such basic income. social security and a small pension and the irs knows it. it sees those documents coming in every year. i would save those documents in a file somewhere so that if someone has a question, you can say, here is all i have got. after a few years, the irs archives its records and it is next to impossible to get them back. it is smart for you to keep your records. i personally keep my records for six years. because i am paranoid. really, it sounds like the tax counseling for the elderly site is giving you the correct information. for callers, there are these
wonderful programs staffed by volunteers. they are called volunteer income tax assistance, vita sites, or tax counseling for the elderly. most of them are run by aarp. 'r free. they really are wonderful. there is a phone number, i do not have it myself but there is a toll-free number at the irs you can call to find out where site is near to you. and, you know, if you do not have internet, then you can call, be prepared to wait on line for a while but you will probably get through and maybe you can push a button and there is an automated line that will tell you where site is. host: from washington, d.c. caller: yes, good morning, thank you. ms. olson: good morning. caller: good morning. i had a very serious tax problem. and i don't know how to solve
it. had a rareound, i cancer. and i traveled to houston, toas, in 2011, participate in a critical try for a drug that had not been approved by the fda. -- for a clinical trial. the doctor cannot have control of the medicine. so, i had to pay for it. while i was in texas, during this time, i went to an h&r block office, because they had always, almost always done my tax returns. and while iw was there, a gentleman reviewed my tax returns, there were two people working on it. and i believe one of them was a former irs agent. what happened is that someone
followed me in to that store and the h&r blockd agent to alter my taxes. and instead of getting a $3000 r efund. it was converted to a $3000 liability. and i refuse to pay this. and i later found out that i think, i was having some other problems with getting my medical bills paid. i had contacted senator ted cruz. to help me with that. host: caller -- was a: the irs that i tea party member. host: we are running out of time but i will let the guests answer because i see a complicated
matter. ms. olson: if you're in washington, d.c., we have a local taxpayer advocate for washington, d.c., a north capitol street. so, i suggest that you look up either in the phone book or if you have online, you can find the phone number for the washington, d.c., local taxpayer advocate. and we can get someone assigned to your case and try to figure out what is going on. if you have a bill outstanding, there are ways of saying maybe you did not owe it in fact. we can do what is called an offer in compromise, which is where either because you cannot afford to pay or because you do not think you have a liability at all, you can make a compromise with the irs for a nominal amount. really look up for the local taxpayer advocate in washington, d.c. it is also in the blue pages of the phonebook, if you have a government in the
pages under the internal revenue service, you will the taxpayer advocate service with our local number there. host: this is keith and arkansas. go ahead, caller: good morning sir. i appreciate your help and i love c-span. i waslson, last year, supposed to get a $1600 refund. and then they told me i owe them $3500. then i wound up paying $350. but i still owe the preparer $277 or something like that. so securitye, i get and i make less than $12,000 a year, ma'am. i don't know why i can't file taxes and tell about, you konw, the -- you konw, the losses i've had because i have a goat farm. i'm paying money to feed the goats. can i take that out of my taxes?
you know, or can i even file taxes? because all i get is the security and i am disabled. i'm sorry, but i just wanted to answer that if you will, please. god bless you. ms. olson: i love goats. i'm thrilled to hear the have a farm. question is if it is a business. you are in the farm is a business rather than a hobby. the laws that has passed that says if you are in a hobby and you have hobby losses, you cannot deduct them. if you are raising the goats for fiber and milk and you are selling the milk, and you can prove that you were in the business of doing this, you conduct the loss of. if you keep having losses year after year, the irs, the court cases are going to say, you are not in the business of doing it.
but you know, you might want to go rather than going to prepare rs, there is a volunteer tax assistance site near your you or a tax counseling and talk with them about your situation. and they can tell you whether your situation constitutes a business or hobby. if you decide it is a hobby, it sounds like your situation is that you would not need to file if you just reported your social security disability income. i really do love goats. it is very true. host: kenneth in illinois. caller: good morning, ms. olson. i have mutual fund and four different kinds of income showing on the funds and cooing qualified dividends, short-term and long-term gains -- including qualified dividends. could you suggest an easy way of computing all these different forms of income, and what form
water use? -- would i use? and what would be the bottom line result i would be looking for? sorry, buti am so there is no easy way to do that. that is part of the complexity of the law. we have heard from a lot of people who have plain vanilla financial situations. you may have what you think is a plain-vanilla situation but because of the complexity of the way the law is about different kinds of financial instruments and things like that, you get a yearat the end of the that is categorizing all this stuff. on the back of the 1099 or a separate supplement from your brokerage house, there should be instructions that tell you line by line where you put these different things. and i prepare my own return and i do it first by hand. i can tell you, i just have to
follow line by line. i walk through the lines on this particular form. it says to move it over to this line. i go through those things. this is wher eyou see the true complexity of the code. so, that's the other 70% of the taxpayers you cannot file the simply 1040 just on its own. i'm sorry. host: roy is in illinois. hi. caller: thanks for c-span. mrs. olson, my wife had to go back to college after she lost her job during a lot of budget cut. and they started piling workload on her, online classes. and she could not do it, so she dropped out of the classes. now they are taking all of our taxes for what's owed. i've sent written request asking what the score -- sent back to the government so we knew
what we had to pay and nobody will tell us anything. they just took our taxes. i was wondering if you could tell me how we could go about fixing this. ms. olson: so, this is a student loan they are taking your tax refunds and applying it to the student loan? yeah. law,he irs is required by of we are notified by the department of education that there is a loan outstanding that need to be paid, we ar required bye law to offeset the tax refunds. unfortunately, the irs can'tit. we get these cases where the dispute is really with the lender or the department of education. what i can tell you is that the department of education has a student loan ombudsman. i have someone like me to deal with these kinds of disputes about, you're not getting good the lendingfrom
company or the university, and how much is applied to it, etc. i would say there have been a number of lawsuits about these online universities where they have taken students money and they folded as well. -- wherenow whether your wife went might be in one of those suits. that might be worked, if you can go online, to do some online searches to find out what is going on. but you can also go to the department of education student ton ombudsman and get them look at what the university is doing and maybe that -- we have to get a notification that says, don't offset. if we don't have that notification, we are required by law to offset the refunds. host: the taxpayer advocate has a website. you can see the report that she files to congress every year
including a list of recommendations on how to improve services a >> tonight on "the communicators" christopher shelton, president of the communications workers of america talks about their opposition to the proposed t-mobile-sprint merger. he's joined by executive senior editor of "communications daily." >> we think it's a bad idea. we think it will destroy about 30,000 jobs in the united tates for a german government-owned company and a japanese billionaire company and we don't see why the german government or japanese billionaires should seek to make money off of american jobs, but that's what that merger will do. >> watch "the communicators" tonight at 8:00 eastern on c-span2. >> the only thing we have to
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>> the c-span bus recently traveled to texas asking folks -- what does it mean to be american? >> what it means to be american is the great opportunities this country gives us. all the great things we can do in this nation. i'm excited we're going to do here as a nation. >> being an american is so much more than a nationality. it's who we are as a people and what we represent. the united states itself represents freedom and the liberty to allows others to do so. when you're an american you step up for other people and allow yourself to present who you are, what you are and you are never afraid to fight for what you believe in as our founding fathers did. >> what does it mean to be an american? what doesn't it mean to be american? it's about reinvention and doing your own thing. being an american is kind of like punk rock. it's do your own thing, independent spirit. it is reinventing yourself.
it's second chances for people all around the world, come here, e pluribus unum, we come together and bring a new thing. we did it in the past and we are going to do it now and the future. mark. >> voices on the road on c-span. >> we're live this afternoon at the center for strategic and international studies where a conversation with deputy attorney general rod rosenstein, he is expected to arrive here shortly to talk about rule of law norms in the united states compared with legal systems abroad, including the legal system in china. this is live coverage on c-span. we're just a minute or two away from the start.