Wireless Access Code:
9166703926
The American Coalition for Taxpayer
Rights (“ACTR”) for CWAG
Stephen M. Ryan, Esq.
McDermott Will & Emery
600 13th Street, N.W.
Washington, D.C. 20005
sryan@mwe.com
Tel. 202-756-8333 (O)
www.mwe.com
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CWAG: WHO IS THE AMERICAN COALITION
FOR TAXPAYER RIGHTS (“ACTR”)?
 ACTR is a 501(c)(6)
 Made up of 2 components: tax preparation companies and financial service
settlement companies
 We help prepare approximately 90 million of the 140+ million individual federal
income tax returns
 We provide approximately 18.6 million of the nearly 20 million RTs
 ACTR tax preparation companies:
– H&R Block
– Intuit
– Jackson Hewitt
– Liberty Tax
– Tax Act (2nd Story)
– TaxSlayer
– CCH Small Firm Services (UTS)
Stephen M. Ryan, Esq.
American Coalition for Taxpayer Rights
sryan@mwe.com
Tel. 202-756-8333 (O)
3
Continued: WHO IS ACTR?
 The tax companies’ offerings range from:
– In person
– Do-it-yourself software (DIY)
– “Professional” software (used by CPAs, lawyers, other preparers)
 ACTR financial services companies:
– H&R Block
– Refund Advantage
– Republic Bank and Trust
– Santa Barbara Tax Products Group
Stephen M. Ryan, Esq.
American Coalition for Taxpayer Rights
sryan@mwe.com
Tel. 202-756-8333 (O)
4
CHARACTERISTICS OF TAX PREPARATION
MARKETPLACE
 In 1999, 1.25 million taxpayers used private sector on-line products. In 13 years
the industry (not just ACTR members) has gone from about 1% of taxpayers to
80% of taxpayers using Internet and electronic tax-preparation products
 The states and federal government did not pay for this change, but have
benefited mightily, e.g.:
– lower cost of processing returns
– reduced errors in returns since software corrects routine taxpayer errors
– taxpayers benefit in reduced burden and cost
 Industry marked by innovation, fierce competition and change
 Software capabilities continue to increase, but not price
 Competition is fierce within sectors (e.g., DIY), and between sectors (DIY v.
stores v. professionals)
 Example: A recent market entrant less than 10 years old has become the #3
company in the industry in a decade
Stephen M. Ryan, Esq.
American Coalition for Taxpayer Rights
sryan@mwe.com
Tel. 202-756-8333 (O)
5
ACTR COMPANIES AND “FREE FILE”: THE
FEDERAL SYSTEM (IRS) AND 23 STATES
 Industry has combined to provide free tax preparation and electronic filing for
the lowest 70% of federal taxpayers (translates to $57K AGI and below)
 ACTR companies provide many of those free services to the poor and
underserved (H&R Block, Intuit, Liberty, TaxAct, Taxslayer)
 23 states have “Free File” programs which include free state returns,
coordinated with the federal program (map on next slide)
 18 other states pay to create “competitive” software
 GAO has said the costs of producing such software and the low take-up rate of
state software do not justify IRS adopting such a model
 ACTR is not Free File, but 6 of the 7 ACTR tax preparation companies are also
Free File companies (H&R Block, Intuit, Jackson Hewitt, Liberty Tax, Tax Act,
TaxSlayer)
Stephen M. Ryan, Esq.
American Coalition for Taxpayer Rights
sryan@mwe.com
Tel. 202-756-8333 (O)
6
STATES SPONSORING FREE FILE
PROGRAMS
NH
WA
VT
MT
OR
MN
ID
WI
SD
UT
CA
AZ
CO
PA
IL
OK
WV
VA
KY
NC
TN
AR
SC
MS
TX
OH
IN
MO
KS
NM
Free File States (23)
RI
IA
NE
NV
AL
MA
NY
MI
WY
CA
ME
ND
GA
CT
NJ
DE
DE
MD
MD
MD
DC
LA
No Income Tax States (9)
FL
State creates its own
tax software and/or efiling system (18)
AK
1
HI
Stephen M. Ryan, Esq.
American Coalition for Taxpayer Rights
sryan@mwe.com
Tel. 202-756-8333 (O)
7
BEING AN INDUSTRY LAWYER PREDODD-FRANK HAD ITS ADVANTAGES!
 National Bank Act preemption was an easy win for industry
attorneys:
– e.g., Pacific Capital Bank v. Connecticut, 542 F.3d 341 (2nd Cir. 2008)
– e.g., Pacific Capital Bank v. Milgram (New Jersey), No. 08-0223
(FLW), 2008 U.S. Dist. LEXIS 19639 (D.N.J. Mar. 13, 2008)
 With new concurrent jurisdiction of the CFPB and states
under Dodd-Frank, life is more exciting
Stephen M. Ryan, Esq.
American Coalition for Taxpayer Rights
sryan@mwe.com
Tel. 202-756-8333 (O)
8
WHAT IS ACTR PREPARED TO DO WITH THE
ATTORNEYS GENERAL COMMUNITY?
 We want to reach a consensus with you (IRS and CFPB) that will stabilize
the regulatory regime, federal and state, for a pro-consumer, protransparency agenda. We are prepared to volunteer for binding “best
practices” to uplift the consumer experience
 We want to drive a common understanding of what is good policy with
respect to tax settlement bank products with you and the CFPB. We
believe this can be done before the 2013 tax season, but in any case,
certainly before 2014
 We can support initiatives to help you combat identity theft in the tax
arena
 We can serve as a resource for you with respect to our industry
Stephen M. Ryan, Esq.
American Coalition for Taxpayer Rights
sryan@mwe.com
Tel. 202-756-8333 (O)
9
ACTR/ATTORNEYS GENERAL
COMMUNITY, CONTINUED
 There are things we must do to protect our industry,
including:
– We will oppose any effort to claim the RT is a “loan” product in
litigation, legislation or regulation (we believe this is an attempt to ban
the product)
– We will continue to resist any attempt to dis-intermediate our industry
from taxpayers/customers
Stephen M. Ryan, Esq.
American Coalition for Taxpayer Rights
sryan@mwe.com
Tel. 202-756-8333 (O)
10
Wireless Access Code:
9166703926