IRS Form 3115 Sin and Travesty

IRS Form 3115 Sin and Travesty

IRS regulations are requiring every business with materials, supplies, equipment and real estate to change their accounting method and file an eight page Form 3115 with their tax return and to mail a copy of the form to an IRS group in Ogden, Utah. This is a sin and a travesty.

Form 3115 is used to adopt a change in accounting method and, in this case, the change gets an automatic approved acceptance by the IRS so no oversight or permission is needed. The change is necessitated by the IRS making it more restrictive to get current tax deductions for materials and supplies that are not used in the year purchased and certain changes to how repairs and similar items were previously deducted. We are not questioning the IRS changes. We are appalled by the required method to report the adoption of the changes to the IRS.

The instructions to Form 3115 are 20 pages long and provide estimated times to keep records, learn about the law or the form and to prepare and send the form to the IRS. The total time is estimated at 82 hours!!! Now, not everyone will have to fill out every schedule but even a quarter of this time is over a half week of work time. Even a tenth of this estimated time is over a day’s work.

The forms have to be attached or included with the tax return and also mailed to Ogden Utah. If nothing else, this will cause extra handling and “paperwork” in a fast developing digital world.

Further, the IRS does not have adequate personnel to answer taxpayer phone calls with over half of those calling hanging up within an hour and those actually speaking to someone subjecting themselves to being on hold for over one hour. And then many of the answered calls cannot be responded to by the IRS person fielding that call and they are told to call back using the same number! How can the IRS even attempt to open the mail they will receive in Utah, let alone review each form?

Next is that most businesses use professionals to prepare their returns. These professionals will need to be paid extra to do this work. And in a larger sense it is work that will likely be ignored by the IRS.

This requirement is a clear illustration that the IRS as an organization is losing it, is failing to grasp the cost of what they are legislating, and certainly doesn’t look at the overall benefit to the country and economy. The forcing of filing these forms in this case is a clear sin and travesty.

A simple solution is to have the taxpayer attach a brief statement to their return that the “repair” regulations have been adopted. No eight page form attachment and no form mailed to Utah. The IRS can include a review of this compliance during their normal audits of businesses. Nothing is lost by the IRS. Taxpayers will save the fees they will need to pay and everyone will save the handling and mailing cost and time and the ecology will save trees that would be chopped down to provide the paper for the forms and mailing envelopes.

Stupid is as stupid does and the Form 3115 requirements is big time stupid! The IRS should rescind this immediately. A copy of this blog has been e-mailed to my Congressman, two Senators, and the Commissioner of the IRS. You should also do that to stop this sin and travesty.