Summaries of Tax-Related Products Issued Women's Pensions: GAO/T-HRD-92-20, 03/26/92 Pension benefits have long been recognized as an important source of GAO found that the recent changes will generally expand pension entitlement and increase benefits for working women and widows. In testimony before the Subcommittee on Retirement Income and Employment of the House Select Committee on Aging, GAO said the following: • Pension benefit entitlement for women should improve substantially under the Tax Reform Act of 1986. For example, (1) about 75 percent of women in pension plans will be vested under the act compared to about 50 percent under pre-act vesting provisions; and (2) almost 1 million women will gain, on average, an additional $980 in annual vested pension benefits under the act's vesting provisions. • The 1986 act will improve benefit equity between men and women, especially in pension plans sponsored by small employers. Before the act, although the majority of participants were in large employers' plans in which men and women earned equitable benefits, most defined benefit plans sponsored by small employers favored the higher paid, who were primarily men. Under the act, differences in benefit allocation between men and women will be dramatically reduced. • Survivor pension benefit coverage for wives of private pensioners increased after implementation of the 1984 Retirement Equity Act. This act required private pension sponsors to obtain a spouse's written approval when a married retiring worker chose a payout option other than a joint and survivor annuity-the benefit payment option that automatically entitles widows to survivor benefits. Despite substantial gains in pension entitlement and benefit distribution for working women and widows, the private pension system alone will not markedly help to ease the economic plight facing poor widows. These women will continue to depend on Social Security as their major source of income in widowhood. Summaries of Tax-Related Products Issued in Fiscal Year 1992 by Subject Matter • IRS recently initiated actions to improve the quality of pension forms that document a wife's decision to agree to waive survivor benefits. IRS' efforts should better ensure that wives are adequately apprised of the economic effects of the decision. Related GAO Product(s) GAO/HRD-90-101, 08/21/90; GAO/HRD-91-58, 03/29/91; GAO/HRD-88-77, 07/11/88; GAO/HRD-90-20, 12/27/89; and GAO/HRD-92-31, 12/10/91 Summaries of Tax-Related Products Issued Taxpayer Assistance GAO/GGD-92-23, 12/10/91 and GAO/T-GGD-92-09, 12/10/91 In a report to the Chairman, Subcommittee on Private Retirement Plans and Oversight of the IRS, Senate Committee on Finance, GAO assessed IRS' implementation of the 1988 Taxpayer Bill of Rights. GAO also testified on its findings at a Subcommittee hearing held December 10, 1991. GAO found that IRS had implemented all 21 provisions of the Taxpayer Bill The Commissioner of Internal Revenue should take several actions to improve implementation of the Taxpayer Bill of Rights. These actions include developing testing procedures to determine whether IRS employees successfully identify and manage taxpayers' hardship situations and, when hardships exist, initiate applications for assistance on the taxpayer's behalf; emphasizing the importance of reading Publication 1 when contacting taxpayers by telephone or through correspondence before taxpayers have an audit interview; and developing standard procedures for district offices to use when advising taxpayers that their installment agreements are subject to cancellation. Summaries of Tax-Related Products Issued in Fiscal Year 1992 by Subject Matter Actions(s) Taken And/or Matter(s) for Actions(s) Taken And/or IRS agreed with GAO's recommendations and has taken or plans to take action to implement them. For example, IRS is • developing test questions to evaluate whether IRS employees successfully recognize taxpayers eligible for Taxpayer Assistance Orders, Congress may wish to consider clarifying the Internal Revenue Code to In October 1992, Congress passed the Revenue Act of 1992, which, among other things, contained a provision giving IRS authority to withdraw a notice of a lien when it is in the best interest of the taxpayer and the government. On November 3, 1992, however, the act was vetoed by the President and as of December 31, 1992, no further action had been taken. Summaries of Tax-Related Products Issued IRS' 1992 Filing GAO/T-GGD-92-23, 03/17/92 and GAO/GGD-92-132, 09/15/92 In a September 1992 report to the Chairman of the Subcommittee on IRS indicators showed that IRS did a good job processing returns in 1992. For example, IRS reviews of samples of refunds showed that 9 of the 10 service centers met or exceeded IRS' 98 percent refund accuracy goal (the other center's rate was 97 percent) and that all 10 centers met IRS' goal of issuing refunds in an average of 40 days or less. Although IRS data also showed that IRS was able to process the great majority of returns accurately, one area-the Earned Income Credit (EIC) caused particular processing problems in 1992. As in past years, IRS used information on tax returns to determine EIC-eligibility for taxpayers who appeared to qualify for the credit but did not claim it. IRS studies indicated that, as a result, IRS may have given the EIC to about 270,000 taxpayers who were not entitled to it. To avoid similar problems in the future, GAO said that IRS should not give the EIC unless it has the necessary information to make correct eligibility decisions. Another measure of filing season performance is how accurately IRS' GAO's visits to IRS walk-in sites and tests of IRS' responsiveness to mail and phone orders for tax forms and publications indicated that IRS' performance in that area had also declined compared to last year. The most significant decline was in the timeliness with which IRS filled GAO'S test mail and phone orders. For example, GAO received only 33 percent of its mail-ordered items within IRS' 14-day delivery goal compared to |