Mark Matthews Talks to Law360 on IRS Preparer Regulation Program

A proposed government office that would oversee federal agencies' program integrity work, including efforts to curb improper tax credit payments, could pose privacy concerns if it were allowed to receive taxpayer information.

Rep. Gerry Connolly, D-Va., who chairs the House Oversight and Reform Subcommittee on Government Operations, said during a recent hearing that he plans to introduce legislation to create a program integrity oversight body to call for anti-fraud controls for programs that are at significant risk of improper payments.

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Mark Matthews, a former deputy commissioner of services and enforcement at the IRS and a former chief of the agency's Criminal Investigation division [current Member at Caplin & Drysdale], said in a vacuum, having better trained and regulated preparers would be an obvious improvement. However, he still questioned the benefit relative to the costs of a preparer regulation program.

"I'm not sure the cost and management issues associated with such a program would pay off in terms of reducing fraud, compared to better funding of existing anti-fraud resources," he said.

The IRS received $12.6 billion in the recently passedomnibus spending bill, an increase of $675 million from the prior year. Rather than creating what he called more bureaucracy, a better approach to addressing the IRS' improper payments would be more funding for improved technology and personnel, Matthews said.

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