January 2015 AKCPA Newsletter

January 5, 2015

President's Message

Happy New YearLance sledding

As the calendar year begins, I am both excited and disappointed to see the New Year come.  It is exciting to think that many opportunities wait in the months ahead.  I am disappointed that 12/31 is over and a new tax season is already here.  It is time to game plan for another round of managing kids with work.  It is always very interesting and oftentimes quite crazy.

I have identified the top 10 things that I am thankful for in 2014.

#1-       I am thankful that Congress passed and the President signed an extension to tax legislation on December 19th.  Just think about it, we could have had a repeat for the 2012 tax year when the laws were passed in January retroactive back to January 1st of the previous year.  As it is not hard enough to tax plan for your clients, it would be awesome if something could be passed semi-timely so that Yoda, the Jedi Master, does not need to surface and identify what is best for your client going into year-end. 

#2-       I am thankful for snow plow and sanding trucks and their drivers.  I live up a mountain road and New Year’s Eve was a beast.  Those drivers gave up their New Year’s Eve and went by around 8:00 p.m.  It allowed for safer travel and saved me a phone call on a tow truck.

#3-       I am thankful for the snow.  As of mid-December, I was thinking that it was going to be a brown Holiday Season in Anchorage.  I still had patches of grass showing, but then it happened, a large dump of snow and just in time before year-end.

#4-       I am thankful for global warming.  Is it really that miserable that we did not go below zero in Anchorage for over a year?  No way, we still get snow without the crazy cold.  My fellow Northern CPAs, I raise a toast to you for having to deal with the colder and crazier weather.

#5-       I am thankful for my dog, Cooper.  My kids had never experienced the loss of a loved one or a pet.  They had their first experience in November when our dog passed away.  Very tough for them as we reminisced about the great memories that we had with her.  Her most famous memory came on the Klutina River when she was only 2.  The Klutina flows into the Copper River; need I say more of how fast that river is.  I was red fishing and hooked into a King Salmon; the King was only about 10 to 12 pounds and surfaced about 10 yards out in front of my wife and I.   The dog jumped in, not knowing any different, and grabbed the tail and dragged it to shore.  It was the craziest thing I had seen and it is a legendary story in our family.

#6-       I am thankful for Russell Wilson.  That is right, big man, you should be on my present list this year as you won me the fantasy football championship.  A nice 33 point performance propelled me through the finals.  Cheers to you and go get us another Super Bowl Ring.

#7-       I am thankful for all the different designations and credentials that can be attached to my name.  Just think about it, I could be Lance Bodeen, CPA/ABV/CITP/CFF/PFS, CVA, CFE, CFP, CGMA, CMEA, SBA, XYZ.  Can you tell me which designation, I made up?  Who knows, there probably is an XYZ designation.  Those printers are super talented to fit that on business card. 

#8-       I am thankful for all the TV Shows that Alaska has to offer.  I know some of you CPAs out there consult on for some of these shows.  Please put in a good word for a show about a CPA that sits at a desk during the day and plays chauffeur at night.  I would ask for Jimmy Fallon and his “tight pants” to play the part of the CPA.  It will make my spirits bright and may attract more CPAs to our profession.  If you have not seen “tight pants”, YouTube is a great resource.

#9-       I am thankful for the client phone call on April 15th to my house at 5:30 p.m. Oh yes that happens when you actually have your number in the phone book.  What am I thinking?  “Are my taxes ready or did you file an extension?”  I have no idea, but I know what I am giving you for a present.  It will be nice letter that says do not come back and go see John Rodgers.

#10-     I am thankful for Linda, the AKCPA Board, and all the Committees Chairs and our Members.  It was a great 2014 and I am hoping that we can make 2015 another awesome year.        


This is just a reminder that the position is still open for our Executive Director.    We are going to interview for a few more weeks and then make a decision on filling the position.

You can find more information about this position on our website at www.akcpa.org.

If you or you know of anyone that would be a good fit for this position, please recommend that they contact the Executive Director search committee at  info@rulien.com.   Thank you.


The Alaska Society is launching its 2nd Alaska Leadership Academy in the Fall of 2015.  The first Leadership Academy was an amazing success and the talent that went through was fantastic.  I have heard nothing but glowing feedback from the participants and its leaders.  Please recommend your Emerging CPA star for the Leadership Academy.  The application period is now open and applications will be accepted until March 1st, 2015.  Please contact Amy Cooper at akcooper@alaska.edu for more information.

Please have a great start to 2015 and thank you.


Paul Hagelbarger Memorial Scholarship

For the year ended April 30, 2009, the three directors of the Fund were Wayne Eski, in his third and final
year, Leslie Schmitz, in her second year, and Debra Gross, in her first year. Each of the directors serves for
a three-year term. Gary Dixon replaces Wayne Eski as director effective May 1, 2009.
Fourteen students applied for the Hagelbarger scholarship during the Fall 2008 semester. Five applicants
were from UAA, six were from UAF, two were from APU, and one was from UAS (Southeast.)
In December 2008 the directors met to review the scholarship applications received. The directors decided
to award one scholarship for $2,000. The scholarship recipient was Shawn Hatfield from UAF, a senior with
a 3.96 GPA who graduates in May 2009 and will begin his career in public accounting in the Anchorage

The three directors of the Paul Hagelbarger Memorial Scholarship Fund, Tracy Hartung, John Rodgers and Bethe Davis met on December 1st to review the applications.  Nine students applied for the Hagelbarger scholarship, four applicants from the University of Alaska Anchorage, three applicants from the University of Alaska Fairbanks, and two applicants from University of Alaska Southeast.  The directors decided to award three scholarships for $2500; one at each university. The scholarship recipients are Amy Isaacson at UAF, Jesyca Mack at UAS and Christa Thompson at UAA.  Congratulations!      

 Jesyca Mack

Jesyca Mack

o   Pursuing her Bachelor of Business Administration, Accounting

o   Work as a Travel Coordinator, Accounting Tech II at the Department of Environmental Conservation

o  Serves as the Vice-President of  SEA-P.A.s, Southeast Alaskan Prospective Accountants Club at the University of Alaska Southeast

o  “I have been blessed with accounting professors that are patient and dedicated to helping students understand and succeed in the courses as well as in the student's career.”

o  “By receiving the Paul Hagelberger Scholarship, I realize that hard work and dedication to academic achievements is paying off.  I am determined now more than ever to succeed with the personal goals I have.”  

·         Julie Hamilton

o   Assistant Professor of Accounting

o   Advisor for the  SEA-P.A.s, Southeast Alaskan Prospective Accountants Club at the University of Alaska Southeast

Alaska Practitioner Liaison Meeting

Virtual Meeting via WebEx
December 3, 2014 Time: 1:00 pm – 3:00 pm Alaska Standard


Internal Revenue Service

  •  Kristen Hoiby, Stakeholder Liaison, NW Area Manager
  • Mike Cvitkovic, Stakeholder Liaison  
  • Shane Ferguson, Stakeholder Liaison, Director
  • Richard Stefanski, Appeals Area Director
  • Liska Foss, Appeals Team Manager
  • Gail Adalsteinsson, SBSE Collection Group Manager
  • Julie Payne, SBSE Associate Area Counsel Managing Counsel 
  • Coral Quimby, Taxpayer Advocate Service Analyst 
  • Sue Stockman, W&I, SPEC Territory Manager
  • Darlene Van Ness, W&I, Taxpayer Assistance Center  

Practitioner Representatives

  • Therese Sharp, Chair, ASCPA, Alaska Society of CPAs
  • Karen Ague, ASCPA
  • Shelda Duff, ASCPA
  • John Rodgers, ASCPA
  • Lisa Rogers, ASCPA 
  • Christy Lee, ABA, Alaska Bar Association
  • Christina Passard, ABA
  • Paula Laurion, EA, Alaska Society of Independent Accountants 
  • Barbara Hompesch, EA, ASIA 
  • Kathie Riley, EA, ASIA
  • L. LaVonne Scott, EA, ASIA
  • Sherry Whah, EA, National Association of Tax Professionals

Meeting Summary

Kristen Hoiby, Stakeholder Liaison, Seattle

Kristen introduced Shane Ferguson, Stakeholder Liaison Director, who was auditing the meeting.  Then, she introduced two guest speakers: Richard Stefanski, Appeals Area Director based in San Francisco, and Liska Foss, Appeals Team Manager based in Seattle.  They delivered an informative presentation on the Appeals Judicial Approach and Culture (AJAC).  Richard addressed the Collection side and Liska spoke to the Exam side.  Here is the .ppt 

Mike Cvitkovic, Stakeholder Liaison, Seattle

IRS will allow E-signatures on two E-file authorization forms for individual income tax returns. The first one is the Form 8878. That’s the IRS E-file signature authorization for Form 4868 or Form 2350 (The Form 2350 is for taxpayers living outside the United States). The other is Form 8879. That’s the IRS E-file signature authorization for the Form 1040 family.  These authorization forms are used when the practitioner PIN method is used. IRS is “allowing” e-signatures, not “requiring” them.  So, this is optional.  If practitioners don’t want to use the E-signature for these authorization forms, they may continue to do business as they have been. (Note: A post-Alaska tax symposium correction was issued stating that E-Signature of E-file authorization Forms 8878 and 8879 will not be mandatory in 2016). Publication 1345 offers some examples of currently acceptable signature methods.   The e-signature process must be able to verify the identity of the person that the electronic form of signature belongs to, as well as generate evidence that the identified person is actually associated with the electronic record. For more info, including a link to Pub 1345, go to IRS.gov/esign.

As it is unlikely that the IRS budget will increase (more likely to decrease) practitioners should anticipate a continuation of the IRS Service Approach offered during 2014. That means continued limited person-to-person interaction and increased use of automated self-service options. Publication 5136 provides a listing of self-service options.

The IRS recently updated the e-Services Registration process with challenge questions for use in unlocking one’s account and certain other changes to the registration screen. More details are available on the e-Services information page on IRS.gov.

With filing season approaching practitioners are reminded to review their e-file application information. Application information should be updated within 30 days of any changes, such as names, address or telephone number. They should also check their EFIN Status by logging into their e-file application through e-services to make sure the summary of the volume and activity of the returns e-filed in the last two years matches their records. If there are concerns or discrepancies, call the e-help desk at 866-255-0654 (6:30 AM to 8:00 PM Central). Search “EFIN” on IRS.gov for frequently asked questions about EFINs.

Qualified tax professional who have a Form 8821, Tax Information Authorization, on file may now request a client’s account transcript using the Transcript Delivery System (TDS).  Form 8821 must be on file with the Centralized Authorization File (CAF) naming the individual, not the individual’s business, as the appointee for the client. TDS transcripts can be requested if either Form 8821 or Form 2848 is on file with the CAF.

Kristen Hoiby, Stakeholder Liaison, Seattle

Kristen reminded that Preparer Tax Identification Number (PTIN) applications and renewals for 2015 are now being processed through December 31. Anyone who preparers or assists in preparing federal tax returns for compensation must have a valid 2015 PTIN before preparing returns. All enrolled agents must also have a PTIN. For more information visit the IRS Tax Professional PTIN System homepage.

Enrolled agents whose social security numbers end in 7, 8, 9 must renew by January 31, 2015 to remain eligible to practice before the IRS. They may go to www.pay.gov, enter “8554” in the Search Public Forms box on the left-hand side, complete the online form and pay the $30 renewal fee. Renewals may take up to 90 days to process.

The Internal Revenue Service announced guidance outlining a new voluntary program designed to encourage education and filing season readiness for paid tax return preparers. The Annual Filing Season Program will allow unenrolled return preparers to obtain a record of completion when they voluntarily complete a required amount of continuing education (CE), including a course in basic tax filing issues and updates, ethics and other federal tax law courses. More information is available on IRS.gov by searching Fact Sheet-2014-8 and Revenue Procedure 2014-42.

Mike Cvitkovic, Stakeholder Liaison, Seattle 

In an effort to combat fraud and identity theft, effective January 2015, IRS will implement Direct Deposit Limits which will limit the number of refunds electronically deposited into a single financial account or pre-paid debit card to three. The fourth and subsequent refunds automatically will convert to a paper refund check and be mailed to the taxpayer. Taxpayers also will receive a notice informing them that the account has exceeded the direct deposit limits and that they will receive a paper refund check in approximately four weeks if there are no other issues with the return. The new limitation also will protect taxpayers from preparers who obtain payment for their tax preparation services by depositing part or all of their clients’ refunds into the preparers’ own bank accounts.

Mike presented a draft of the new Directory of Federal Tax Return Preparers with Credentials and Select Qualifications that will be available in January 2015 on IRS.gov to help taxpayers determine return preparer qualifications. The Directory will include the name, city, state and zip code of all attorneys, CPAs, enrolled agents, enrolled retirement plan agents, enrolled actuaries and AFSP participants who have obtained a Record of Completion and who have a valid PTIN. 

Incidents of telephone and online scams and phishing continue rampant across the country. Practitioners and their clients should refer to Report Phishing and Online Scams on IRS.gov for the proper way to report such incidents. 

The Taxpayer Protection Program involves letters being sent to taxpayers to verify identity in order to process their tax returns.  Letter 4883C provides a toll-free IRS Identity Verification telephone number to call.  Letter 5071C provides the toll-free IRS Identity Verification telephone number and a secure Identity Verification Service website idverify.irs.gov.       

The IRS continues to expand the number of Identity Protection Personal Identification Numbers (IP PINs) being issued to victims. The IP PIN is a unique identifier that shows that a particular taxpayer is the rightful filer of the return. In 2013, the IRS has issued IP PINs to more than 770,000 taxpayers who have been victimized by identity theft. That’s more than twice as many as the previous year. The IP PIN will allow these individuals to avoid delays in filing returns and receiving refunds.  CP01As will be issued this month (December).

Some later portions of the Affordable Care Act came into play this year and will impact the 2015 filing season. The ACA Information Center for Tax Professionals provides information for individual clients, business clients, payroll clients, as well as general resources. 

There is new information regarding the IRA One-Rollover-Per-Year Rule. The change in the application of the one-per-year limit reflects an interpretation by the U.S. Tax Court in a January 2014 decision applying the limit to preclude an individual from making more than one tax-free rollover in any one-year period, even if the rollovers involve different IRAs. Before 2015, the one-per-year limit applies only on an IRA-by-IRA basis (that is, only to rollovers involving the same IRAs). Beginning in 2015, the limit will apply by aggregating all of an individual’s IRAs, effectively treating them as if they were one IRA for purposes of applying the limit.

The Internal Revenue Service announced the adoption of a "Taxpayer Bill of Rights.” The Taxpayer Bill of Rights takes the multiple existing rights embedded in the tax code and groups them into 10 broad categories, making them more visible and easier for taxpayers to find. Publication 1, "Your Rights as a Taxpayer," has been updated with the 10 rights.

The Internal Revenue Service announced major changes in its offshore voluntary compliance programs, providing new options to help both taxpayers residing overseas and those residing in the United States. The changes include an expansion of the streamlined filing compliance procedures announced in 2012 and important modifications to the 2012 Offshore Voluntary Disclosure Program (OVDP). The expanded streamlined procedures are intended for U.S. taxpayers whose failure to disclose their offshore assets was non-willful.

IRS.gov has new resources that can help tax professionals manage estate and bankruptcy issues. For more information, including links to forms and publications, see Bankruptcy and Deceased Taxpayers – Probate, Filing Estate and Individual Returns, Paying Taxes Due.

Individual Taxpayer Identification Numbers (ITINs) will expire if not used on a federal income tax return for any year during a period of five consecutive years. The new policy applies to any ITIN, regardless of when it was issued. Under the old policy ITINs issued after Jan. 1, 2013 would have automatically expired after five years, even if used properly and regularly by taxpayers. To give all interested parties time to adjust and allow the IRS to reprogram its systems, the IRS will not begin deactivating ITINs until 2016. 

Treasury Department Circular 230, revised 6-2014, is now available online.

Revenue Procedure 2014-43 provides revised procedures for individual payees who are required to obtain validation of social security numbers from the Social Security Administration to prevent or stop backup withholding under section 3406 of the Internal Revenue Code following receipt of a second backup withholding notice from a payer within a three-year period. 

Issues & Status  

No items.

Roundtable & Comments

Sue Stockman, Stakeholder Partnership Education and Communication (SPEC)

Kris Ashley continues to staff the Anchorage office.  Practitioners are solicited to volunteer for the upcoming VITA season.  Practitioners may be eligible to earn up to eighteen continuing education credits.  SPEC will be providing ACA training for volunteers.                                                                  

Julie Payne, Counsel

The Associate Counsel position, filled by the person who visits Anchorage, is currently open.  Practitioners are encouraged to use the Virtual Service Delivery (VSD) to interact with Counsel staff.  Practitioners should inform the assigned trial attorney of interest in VSD. Julie reinforced the benefit of providing information early as was expressed in the AJAC presentation. 

Sonia Oen, Examination and LB&I (written submission)

Alaska did not receive any new hires in August as we had hoped.  The TCO’s from WA and OR will continue to circuit ride both Fairbanks and Anchorage, but due to budget constraints they will not be here as often this year.    If the representatives could ensure that their clients are prepared and do everything in their power to keep the appointments when the TCO’s visit it will help ensure timely completion of the audits. 

We currently have only 4 SB/SE revenue agents covering the entire state of Alaska.   Therefore some representatives may have noted that they are being audited out of WA, especially those in SE.   There is no projected hiring due to budgets.   Emphasis is high income individuals, non-filers, abusive activities.   We will also continue with the National Research Program audits of 2013 1040’s and IRDM audits (1099-K matching specifically) as national projects.

There has been no staffing changes in LB&I RA’s with 4 agents  (3 in Anchorage and 1 in Fairbanks).  

I also wanted to piggy back on whatever was said regarding AJAC to emphasis that unless the RA/TP/POA can state with certainty that all information requested has been provided the case will not be forwarded to Appeals, it will instead be sent for issuance of a Statutory Notice of Deficiency. Ensuring that all documents are presented during the exam is very important, they cannot hold anything back for Appeals or use that additional time to locate missing information.   I am requesting 18 months minimum on statue extensions since they need 12 months when it arrives in Appeals and I am finding that it can take up to 4 months to get there once it leaves the group.  This also allows a bit of wiggle room in case it is returned to the agent or back to the group for any corrections prior to being sent to Appeals.  

Gail Adalsteinsson, Collection

Three Revenue Officers are posted in Anchorage; one in Fairbanks until April 2015. High graded cases are being worked from the Seattle office.

Darlene Van Ness, Taxpayer Assistance Center

Field Assistance is no longer offering Interactive Tax Law Assistance (ITLA), except for specific issues, i.e., with notices. There is one employee full time staffed in Fairbanks. Return prep is being referred to VITA and the practitioner community. Affordable Care Act Training for Tax Law and Accounts has been completed. Still working lots of identity theft cases; procedures are updated as cases become more frequent or serious in nature. 

Coral Quimby, Taxpayer Advocate

The Anchorage office has a new lead case advocate, Doris (Dee) Marshall, and a new secretary, Casey Sundly. The Advocate staff is gearing up for ACA training for the case advocates in January. 

Lisa Rogers

Lisa related the delay of a client’s refund.  Promised delivery dates were missed.  When the IRS hasn’t responded by the date promised, practitioners should contact the Taxpayer Advocate Service. 

Paula Laurion 

Paula inquired about the TAS Virtual Service Delivery (VSD) at the Kenai Community Library. The library indicates service is available from 9 a.m. to 1 p.m.  Kristia Douts, Alaska Taxpayer Advocate, will contact the library regarding extending the hours to 3:30 p.m.  Paula mentioned encountering a delay in the posting of POAs that were submitted weeks earlier (Sherry Whah expressed a similar situation.) This is a level of service issue that will be forwarded to IMRS Shared Bulletin Board.

Next Scheduled Meeting

The date is to be determined.

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