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The IRS Appeals Office Has Made Initial Preparations for the Affordable Care Act

January 5, 2012

TIGTA - 2012-2 David Barnes David.barnes@tigta.treas.gov TIGTACommunications@tigta.treas.gov (202) 622-3062

The IRS Appeals Office Has Made Initial Preparations for the Affordable Care Act

WASHINGTON – The Office of Appeals at the Internal Revenue Service (IRS) has

taken some initial actions to begin preparing for the new cases that it anticipates will

result from the new tax law provisions included in the Affordable Care Act (ACA),

according to a report publicly released today by the Treasury Inspector General for Tax

Administration (TIGTA).

The ACA was enacted in March 2010 and contains $438 billion in revenue provisions

that are in the form of new taxes and fees. At least 42 of its provisions add to or amend

the Internal Revenue Code.

The IRS ACA Office determined that the new law’s impact on Appeals would be

minimal until after Calendar Year 2013. The Office of Appeals expects that the new law

will result in new Appeals cases over the next several years. TIGTA auditors found that

the Appeals Office has taken some initial actions to begin preparing for the new health

care law, including detailing some Appeals staff to the IRS’s ACA Office and creating an

internal website with links to IRS ACA-related training, guidance, and other resources.

“Because of the potential for the ACA to affect most taxpayers, effective planning is

critical to ensuring Appeals’ readiness to prepare for this legislation and resolve taxpayer

requests in a timely and effective manner,” said J. Russell George, Treasury Inspector

General for Tax Administration.

As Appeals moves forward with its planning efforts, TIGTA believes management

should develop a more formal approach to its ACA planning activities to ensure they are

ready to resolve taxpayer requests of ACA-related issues in a timely and effective

manner. This should include outlining the key objectives and tasks that need to be

addressed to prepare for the ACA-related impact on Appeals, establishing who should be

responsible for conducting these activities, and developing timelines for completing these

actions over the next several years.

TIGTA made no recommendations in its report.