Editor’s Note: Nancy Rossner is executive director of The Community Tax Law Project (CTLP) in Richmond, VA. CTLP was founded in 1992 as the first independent low-income taxpayer clinic in the nation. As a nonprofit organization, it provides free legal services to low-income Virginia taxpayers encountering federal and state income tax disputes.
ATT: Nancy, it’s great to be talking to you about your career. What got you interested in tax in the first place?
NR: Well, to be honest, it wasn’t tax that first drew me to the work I am doing now at CTLP. It was really the public interest aspect that drew me in, although I did enjoy my tax and nonprofit classes in law school. Through the actual practice of income tax controversy work when I first started at CTLP, I found that I loved both sides of it—helping people who could otherwise not afford legal assistance, and navigating the challenging and ever-changing terrain of income tax law.
ATT: What, if anything, surprises you most about the practice of tax law?
NR: I continue to be surprised by how much you can learn about a taxpayer just by reviewing their taxes or working on their tax case. Tax not only intersects many other areas of law, but it dovetails with so many different aspects of people’s lives. Often, we are learning about very personal parts of people’s lives just to help them with their tax matters—we learn about their divorces and custody battles, deaths of family members, health issues, job losses, home losses—you name it. That is also part of what makes the work we do so interesting. We are not only practicing tax, but we are taking a close look into our client’s lives, as complicated and tumultuous as they may be at times.
ATT: How did you first get involved in the Tax Section?
NR: I think what really drew me in and inspired me to get more involved was when I was invited to participate in an in-person courtesy call with representatives of the IRS and Treasury on behalf of the Pro Bono and Tax Clinics Committee. The opportunity to present to high level IRS and Treasury representatives about a topic affecting our clients was a big deal to me, and the fact that they asked questions, took notes and were interested in what I was stating on behalf of our committee felt pretty amazing. It really clicked for me what it means to be part of the Tax Section.
ATT: You were recently a Nolan Fellow. What did that mean to you and how did it enhance your experience of the Tax Section?
NR: I was honored to be chosen as a Nolan Fellow because it was an acknowledgement of my participation in the Tax Section up until that point, but it also encouraged me to get more involved. With the fellowship came the opportunity to attend all Tax Section meetings for one year, and that enabled me to network with other members, attend really interesting panels and think about how I could continue to contribute moving forward.
ATT: Tell me about your experience heading up a LITC. What are some of the unexpected challenges and rewards you are finding in this role?
NR: Well, I am still fairly new in the role! But at six months in, I do feel like I am finding my footing. Some of the first things that come to mind when I think about the challenges that we face as an LITC are the challenges that most non-profits face—things like fundraising, grant writing and reporting, and meeting the needs of our community with limited resources. The work itself is very rewarding—in that we have the ability to significantly impact our clients’ lives for the better. These are people who otherwise would not have received the help they need but who desperately need someone in their corner, fighting for them. Helping a domestic violence survivor who is under audit get the refund she is due from the IRS so that she can start a new chapter away from her abuser, or helping a young man who made poor financial decisions about stocks inherited when his father passed away—that is very fulfilling work at the end of the day. It is also quite rewarding to be leading our LITC into its fourth decade of existence, carrying on the legacy of our founder, Nina Olson.
ATT: You’ve been at CTLP for over a decade now. What changes have you seen in engagement with the IRS and U.S. Tax Court on LITC issues?
NR: It really wasn’t until my involvement in the ABA that I began to see the back and forth between the IRS, the U.S. Tax Court and attorneys representing the interests of low-income taxpayers. Through undertakings like comment projects, courtesy calls, liaison meetings, Systemic Advocacy Management System submissions and Priority Guidance Plan recommendations, just to name a few, it really feels like the IRS and the Court are open to—and interested in—the recommendations of the LITC community. It feels momentous to me that we have this opportunity to effect change on such a grand scale, especially through the Tax Section. However, it does require the participation of those attorneys and representatives on the front lines that are engaging with low-income taxpayers on a regular basis. We need to take advantage of all of these opportunities for engagement to ensure that the needs of our clients are heard, because the IRS and the court are listening.
ATT: If you could change one aspect of tax administration that would have a direct impact on low-income taxpayers, what would it be and why?
NR: The IRS spends a lot of time and resources going after low-income taxpayers who are less educated about the tax system, less likely to engage in the tax system, and cannot afford to pay the IRS whether what the IRS proposes they owe is legitimate or not. Studies also show that IRS audits of tax credits geared towards low-income families, like the Earned Income Tax Credit (EITC), are quite high when compared to the funds that credits like the EITC contribute to the new tax gap. Similarly, some tax policies may appear to be neutral on their face but have disparate impacts on low-income communities of color. These are areas for which I would like to see some positive changes. I am hopeful that our new IRS Commissioner, supported by the IRS’s new funding, will be taking these issues very seriously, especially based on his recent testimony that audits of families with income below $400,000 will not be increased. Although this is promising and is hopefully comforting to the low-income families we serve, I would argue that the audit rates of low-income families as a starting point are already too high.
ATT: You are the chair of the Section’s Pro Bono and Tax Clinics Committee. How can the Section be more engaged in supporting LITC issues?
NR: I have seen such great support from the Section when it comes to LITC issues. Through comment projects, pro bono settlement days, and other similar projects, the LITC community really appreciates the support of the Tax Section. The Pro Bono and Tax Clinics Committee does have some new projects on the horizon as well, including a project to assist incarcerated individuals in obtaining stimulus payments for which they are eligible. I hope we will continue to feel the support of the Section in this project and the others to come. I also hope that the tax attorneys reading this will consider reaching out to one of the LITCs in their area to take on at least one pro bono case per year. Or if they are already volunteering, take on one more case per year. Even one case can make a big difference for clinics like mine that are often inundated with more requests for assistance than they can address.
ATT: A frequent complaint is that the tax code keeps getting more complex, but the Code is also becoming a more frequent means to provide social benefits which often benefit low-income taxpayers. What can Congress do to provide simplification even as it expands the Code?
NR: You’re right; in fact, the Earned Income Tax Credit is the most effective federal anti-poverty tool and it is governed by the IRS. The role of the IRS is not just that of an enforcement and revenue collection agency anymore; it is also that of a social benefits provider. Part of an effort to simplify the Code could include actually moving some of these programs like the EITC out of the code and transforming them into social spending programs. Outside of that, Congress could consider directing the IRS to centralize many of these programs into a division of the IRS whose sole purpose is to manage these credits due to their complexity. If the IRS does continue to administer social benefits through the Code, their continued funding is a must. Improvements to technology alone could provide significant improvements to taxpayer interactions with the IRS and their understanding of what is required of them.
ATT: When you’re not busy thinking about tax, what do you do to unwind? How important is it to maintain balance for mental health?
NR: In our profession, it is so easy to get burnt out. We need to be more cognizant of our mental health and how it affects our overall well-being. I was delighted to see that at the Midyear Meeting one of the Tax Section’s committees held a wellness walk in downtown D.C. I thought that was such a great idea. When I am not thinking about tax, I enjoy spending time outside. I like to garden, and the pandemic gave me a great opportunity to expand my pollinator-friendly garden by growing new plants from seed. In addition to gardening, I enjoy going on walks and hikes with my husband and two daughters, especially when we have some time to take a day trip to the Blue Ridge Mountains.