LITC - Low Income Taxpayer Clinic

Purpose: This topic is intended for site administrators and other agency staff with overall responsibility for administering LITC programs. This topic covers approaches to collecting LITC information, which will vary among agencies. Data entry instructions for LITC information should be provided to staff by each agency.

Cost: There is no cost for the fields and blocks provided for LITC.

LITC grants are provided for representation, or education and outreach, or both. "The IRS may, at its discretion, award grant funds based on controversy, ESL, or a combination of program plans to achieve the goals of the LITC Program." Recording and reporting on this information typically involves two LegalServer modules: 1) Matters for representation (controversy cases); and, 2) Outreaches for ESL (education and outreach activities). The information provided here should be considered possible approaches. It is ultimately up to each agency to determine how to record and report its LITC information. One example is "consultations" under LITC. An agency can record consultations as matter records or as outreach records, depending on the level of detail desired, whether consultations may be counted for other purposes as "cases", internal staffing and workflow, or other factors.

LegalServer Configuration

LegalServer Forms and Processes

The modules relevant to LITC (Matter and Outreach) are dynamic. Site administrators control the processes and forms that allow data entry. As noted above, site administrators can also create site specific fields for either module if there is not a system field corresponding to a given need.

For controversy cases, and consultations if those are recorded as matters, administrators typically create an auxiliary process and form. The process link is often placed in the Additional Information or Auxiliary link category. The auxiliary form contains the fields, instructions, and other elements needed. If the LITC block is used to allow multiple issues per case, it is often placed on a separate auxiliary form along with the LITC Issues list view.

For outreach records, type and subject are often used to classify the LITC outreach and educational activities information. Some agencies use branch logic on a site specific lookup field if they also record many other kinds of outreach information.

LegalServer Reports

There are various example LITC reports on the Example Reports help page.

It is worth noting that the matter LITC Fields are not on the Case Data report table. Many are on the LITC Fields subtable from the Case Data report top-level table. The LITC Fields table is one-to-one with the Case Data table. The LITC Issues subtable is many-to-one as that represents the data in the LITC block.

LegalServer Fields

Below is list of system fields related to LITC. Additional system fields may be added over time. Agencies may also use site specific fields together with these fields when creating forms and profiles.

Outreach

  • ESL or NonESL (lookup) (Values: ESL, Low Income, Other Organization)
  • Number of Attendees (Actual)
  • Language Outreach conducted in (lookup) (System Language lookup)
  • Number of ESL Taxpayers referred for Controversy Representation (integer)
  • Number of Tax Returns prepared ancillary to ESL Activities (integer)
  • Number of ITIN Applications prepared (integer)
  • Number of One-on-One Consultations conducted with ESL taxpayers (integer)
  • Number of One-on-One Consultations conducted with Low Income taxpayers (integer)
  • Number of Professional Education Credits per Attendee (integer)
  • The Outreach module has additional fields available, such as Subject, Legal Problem Code, Funding Code, etc., that an agency may find useful in connection with LITC.

LITC block and LITC Issues Listview

A matter in LegalServer can have one or more LITC Issue records. This block and list view allows adding and editing multiple issues to a LegalServer case/matter. The block and list view are generally placed on their own auxiliary form, and a separate auxiliary form contains the other fields not collected by the block.

The block and list view can be configured to collect and display the following fields:

  • LITC Issue Start Date
  • LITC Issue End Date
  • Tax Year (lookup)
  • LITC Type of Assistance (lookup) (Values: Consultation, Controversy)
  • IRS Function or Court (lookup) (Each value may have an IRS Function or Court Category value)
  • IRS Function or Court Category (lookup) (Values: Accounts Management, Exams, Collection, Appeals, Litigation, Miscellaneous)
  • LITC Issue Note (textarea)
  • LITC Controversy Issue (lookup) (Each value may have an LITC Controversy Issue Category)
  • LITC Controversy Issue Category (Values: Income Issues, Deduction Issues, Credit Issues, Status Issues, Tax/Refund/Return/Statute of Limitations Issues, Penalty Issues, Collection Issues
  • Amount in Controversy (money)
  • Brought into Filing Compliance (boolean)
  • Brought into Collection Compliance (boolean)
  • Dollars Refunded in Cash (money)
  • Decrease in Corrected Tax Liabilities (money)

Note that the listview does not have default custom filters, so while the columns presented can be customized, the filter of the data can not be customized without embedded reports.

Since the LITC block collects many-to-one data there are three recommended uses of it:

  1. Track the Tax Years at issue by using the following options
    1. LITC Issue Start Date
    2. Tax Year (lookup)
    3. LITC Issue Note (textarea) - optional to record notes
    4. Optionally any of the compliance or dollar values.
  2. Track the IRS Functions Worked by using the following options:
    1. LITC Issue Start Date
    2. IRS Function or Court Category (lookup)
    3. IRS Function or Court (lookup)
    4. LITC Issue Note (textarea) - optional to record notes
  3. Track the IRS Controversy Issues present by using the following options:
    1. LITC Issue Start Date
    2. LITC Controversy Issue Category (lookup)
    3. LITC Controversy Issue (lookup)
    4. LITC Issue Note (textarea) - optional to record notes

Matter

  • ESL Taxpayer (boolean)
  • Referred to Taxpayer Assistance Service (boolean)
  • Was controversy amount for any one year greater than $50,000? (boolean)
  • Referred for Controversy Representation (boolean)
  • Income exceeds 250% of the federal poverty guidelines (boolean)
  • Worked in more than one IRS function or court (boolean)
  • More than one tax year worked (boolean)
  • Joint Representation of Taxpayers
  • Represented by Volunteers
  • Representing on related State or Local tax matters
  • Notice of Appearance entered in US Tax Court
  • Represented in US Tax Court case without a Notice of Appearance
  • Informal Consultation in US Tax Court without Representation
  • Brought into Filing Compliance
  • Brought into Collection Compliance
  • Total Dollars Refunded in Cash
  • Total Decrease in Corrected tax liabilities, penalties, and interest
  • Other available fields on matter:
  • Tax Type (lookup)
  • ESL or NonESL (lookup)
  • Amount in Controversy (money)
  • If yes, was a waiver obtained (boolean)
  • Collection Issues (multi-select lookup)
  • Examination Issues (multi-select lookup)
  • Miscellaneous Issues (multi-select lookup)
  • Other Issues (multi-select lookup)
  • Describe Other Issue (text)
  • Number of Bankruptcy Cases (number)
  • Number of Returns Prepared (number)
  • Returns Prepared Ancillary to ESL Outreach/Education (number)
  • Number of Returns Prepared Related to Controversy (number)
  • Number of State Matters (number)
  • Number of Taxpayers Assisted (number)

The above list of Matter fields are only those specifically related to LITC.

Grant Report Discussion

General Information (Form 13424-A)

This section suggests possible approaches to recording and reporting on the information required by form 13424-A.

Outreach Activities

Presentations designed to provide information about the clinic and its services — to taxpayers or groups that serve taxpayers

1A - Number of outreach activities for ESL taxpayers

1B - Number of outreach activities for low income taxpayers (not counting A, ESL)

1C - Number of outreach activities for other organizations (not counting A or B)

1D - Total

Report on outreach records, one record per activity. Distinguish these records from other outreach records using a field such as Outreach Type or Subject. Categorizing between 1A, 1B, and 1C, can be done using the ESL or NonESL lookup field, with lookup values such as ESL, Low Income, and Other Organizations. Current IRS instructions say an outreach should be reported based on the primary intended audience, not the actual attendees.

Educational Activities

Events designed to provide information about tax rights and responsibilities to taxpayers

2A - Number of educational activities for ESL taxpayers

2B - Number of educational activities for low income taxpayers (not counting A)

2C - Number of educational activities for organizations (not counting A or B)

2D - Total

Report on outreach records, one record per activity. Distinguish these records from other outreach records using a field such as Outreach Type or Subject. Categorizing between 2A, 2B, and 2C, can be done using the ESL or NonESL lookup field, with lookup values such as ESL, Low Income, and Other Organizations. Current IRS instructions say an outreach should be reported based on the primary intended audience, not the actual attendees.

3A - Number of attendees for 2A

3B - Number of attendees for 2B

3C - Number of attendees for 2C

3D - Total

Report on the "Number of Attendees (Actual)" field for each outreach record, categorized as above.

4 - List of topics covered in Section 2 educational activities. Typically tracked outside of LegalServer, however counts can be obtained in a report if a field is used to classify these records. A multiselect field is sometimes used to record multiple topics per outreach record; note that this requires a manual count of individual topics.

5 - List of languages other than English in which educational activities conducted.

Report on the corresponding field per outreach record.

Consultations

Discussion with a taxpayer to provide brief advice about a specific tax matter that does not result in representation. Technical Assistance consultation is a discussion with a tax practitioner or other service provider designed to give brief advice about a tax issue.

6A - Number of one-on-one consultations conducted with ESL taxpayers

6B - Number of one-on-one consultations conducted with low income taxpayers

6C - Total

Consultation information can be recorded as a raw number per outreach record (similar to Number of Attendees). Agencies wanting to record more detail can record each consultation as a matter and close the case. Another strategy is a 'global' matter against which each consultation is recorded as a timeslip. Reporting would be the time recorded against that record, with date ranges based on the timeslip date. A similar strategy is a 'global' outreach record with each consultation recorded as a timeslip on that record.

7 - Number of technical assistance consultations. Typically tracked outside of LegalServer because of the low number of records. However one strategy to record these would be a 'global' outreach record for technical assistance, with a timeslip recorded for each technical consultation. Reporting would be the time recorded against that record, with date ranges based on the timeslip date. Recording these consultations as matters within LegalServer is also possible, either time against one 'global' matter record, or individual matters; either option requiring a fake client name for the matter(s).

Referrals

8 - Number of ESL taxpayers referred for controversy representation (only for clinics operating an ESL program)

Report using the corresponding field on outreach records.

9 - Number of cases where Taxpayer Assistance Services (TAS) was requested (only for clinics that operate a controversy program)

Report using the corresponding field on matter records.

Tax Returns and Other Documents

10A - Number of tax returns prepared ancillary to ESL activities

Report using the corresponding field on outreach records.

10B - Number of tax returns prepared to resolve a controversy

Report using the corresponding field on matter records.

10C - Total number of returns prepared

11 - Number of ITIN (Individual Taxpayer Identification Numbers) applications prepared.

Report using the corresponding fields on outreach records and matter records.

Volunteer Activities

12 - Does the organization have a pro bono panel.

13 - Number of volunteers that provided service to the clinic during the reporting period that are:

13A - Attorneys

13B - CPAs

13C - Enrolled Agents

13D - Interpreters/Translators

13E - Students

13F - Others

13G - Total

Lines 13A-F. In this section, report on the number of volunteers who provided service to the clinic during the reporting period. Count each volunteer only once, based on the category of services the volunteer typically provides to the clinic. If a tax practitioner is multilingual and also provides translation services, you may note that in the program narrative; however only count each volunteer once in this section.

14 - Total number of hours of service provided by volunteers.

IRS instructions provide 13424-F.

LegalServer can record time for any user in the database. Individual timeslips can be linked to a matter, an outreach, or neither. Timeslips can also serve as a means to "count each volunteer only once" for the reporting period. A report can display a list of volunteers with timeslips recorded during the report period, one row per volunteer with a total of each volunteer's time for that period.

Professional Education Activities

15 - Number of professional education (CPE or CLE) credits available through presentations conducted.

Report on the corresponding credits available per attendee field on outreach records. Multiply that by the Number of Attendees field to obtain the total. Optionally distinguish these records from other outreach records using a field such as Outreach Type.

16 - List of topics covered during CPE or CLE presentations. Typically not tracked in LegalServer, however counts can be obtained in a report if a field is used to classify these records.

Controversy Cases

Recorded as matters in LegalServer. Multiple issues per matter are recorded using the LITC block element.

Controversy Case Information (Form 13424-K)

This section suggests possible approaches to recording and reporting on the information required by form 13424-K.

Case Inventory

1A - Beginning case inventory (number of controversy cases worked in the previous year that remain open)

1B - New cases opened during the reporting period

1C - Total of 1A and 1B

1D - Cases closed during the reporting period

1E - Ending case inventory (number of controversy cases that remained open at the end of the period - 1D minus 1C)

Standard LegalServer report filters for Date Opened, Date Closed, and Date Open Range. The field used to filter on "LITC" cases (funding code, assigned program, site specific field, etc.) will vary among agencies.

Cases Worked

2 - For the cases reported on line 1C, indicate the IRS function or US court where the controversy is being addressed as of the last day of the reporting period or when closed if closed during the reporting period. Each case should only be counted once per reporting period. There is an example report that filters for the latest function worked (although "last" on that report is not limited to being within the reporting period).

Additional Case Information

For the cases reported on line 1B (newly opened cases), the number of cases where:

3 - The amount in controversy exceeds $50,000 per tax period. (Instructions say "for any tax year")

4 - The taxpayer's income exceeds 250% of the federal poverty guidelines.

Report based on the corresponding fields or percentage of poverty.

For the cases reported on line 1C (cases open at start of the period and newly opened cases), the number of cases involving:

5 - Matters worked in more than one IRS function or court

6 - More than one tax year

7 - Representation of ESL taxpayers

8 - Joint representation of taxpayers

9 - Representation by volunteers

10 - State tax matters

Report based on the corresponding fields.

US Tax Court Activities

11 - Does the clinic participate in the US Tax Court Clinical Program

12 - Number of U.S. Tax Court cases worked during the reporting period in which an appearance was entered pursuant to Tax Court Rule 24

13 - Number of U.S. Tax Court cases worked during the reporting period in which the clinic represented the taxpayer, but no appearance was entered

14 - Number of informal consultations in the U.S. Tax Court during the reporting period in which the clinic provided advice to a taxpayer, but not representation

Closed Case Outcomes

15 - For the cases reported on line 1D (closed during the report period)

15A - Number of cases in which the taxpayer was brought into filing compliance

15B - Number of cases in which the taxpayer was brought into collection compliance

15C - Total amount of dollars refunded in cash to taxpayers

15D - Total decrease in corrected tax liabilities, penalties, and interest (but not below zero for any taxpayer)

Report based on the corresponding fields.

Controversy Issues Worked (Form 13424-B)

  • Income Issues
  • Deduction Issues
  • Credit Issues
  • Status Issues
  • Tax / Refund / Return / Statute of Limitations Issues
  • Penalty Issues
  • Collection Issues
  • Total Controversy Issues

"The reports capture all controversy issues arising from all controversy cases that were open at any time during the reporting period, including cases carried over from the previous grant cycle. The issues reported should relate to all cases reported on Form 13424-K, line 1C for the same reporting period."

Advocacy Information (Form 13424-C)

The information reported (System Advocacy Submissions (SAMS), Published Materials, Television and Radio Appearances, and Public Service Announcements) is typically tracked outside of LegalServer. Site administrators could design outreach records to capture this information.


Example Auxiliary Form for LITC

An example auxiliary form for LITC cases.

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