Sell Excess Federal Real Property
1-Year Savings: $3 billion
5-Year Savings: $15 billion

Due to a combination of negative incentives and unnecessary red tape, selling federal real estate is a long, costly process. Reforms are essential, because Uncle Sam owns more real property than any other entity in America: approximately 267,000 buildings and structures covering 1. billion square feet of office space. An October 31, 2017, Congressional Research Service (CRS) report found that, “In FY 2016, federal agencies owned 3,120 buildings that were vacant (unutilized), and another 7,859 that were partially empty (underutilized).”

In FY 2022, the General Services Administration (GSA) reported total assets of $59 billion, an increase of 17.3 percent from the $50.3 billion from FY 2021. These include more than “363 million square feet of space in 8,397 buildings in more than 2,200 communities nationwide.”

When the GSA Public Buildings Service reports a property as excess, that property must first be screened for use by other federal agencies. If another agency wants it, that agency gets it. If the property goes unclaimed by every eligible agency, according to Title 40 of the U.S. Code and the McKinney Vento Homeless Assistance Act, it must be screened for use by providers of homeless shelters, who can use the property for free. If shelters are not interested, the property is screened for other public uses and sold for up to a 100 percent discount of market value. Finally, if no public use can be identified, the property is auctioned and sold. That process is upside down: The government should first try to sell the property and give it away only if there is no other alternative.

The government’s current leasing practices are also problematic. They have been on the GAO’s High Risk List since January 1, 2003. According to the April 20, 2023, report, GSA’s “efforts to improve the accuracy of addresses in its Federal Real Property Profile database have yet to show tangible results. This makes it difficult to manage federally owned assets.”

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For US expatriates, navigating the process of submitting their annual income tax return to the Internal Revenue Service (IRS) can present unique challenges. While the convenience of electronic filing (e-filing) offers an efficient way to submit your federal tax return, certain conditions may require you to submit a paper tax return by mail. Understanding when and how to accurately mail your personal income tax return is crucial to ensure compliance with the IRS and avoid unnecessary processing delays.

WHY E-FILING SHOULD BE YOUR FIRST CHOICE FOR TAXES?

Before delving into the specifics of mailing your federal tax return, let’s first highlight the significant benefits of e-filing your personal tax return. The IRS encourages all taxpayers, including those residing abroad with foreign income, to file electronically due to several compelling advantages:

• Quicker Processing and Refunds: E-filed income tax returns are processed more rapidly than paper filings, which means faster refunds. For expats anticipating a refund, this method significantly shortens the waiting period.
• Enhanced Security: Submitting your federal return electronically provides a higher level of security than traditional mail, minimizing the risk of lost or intercepted sensitive information.
• Immediate Confirmation: Upon successful submission of your e-filed return, the IRS provides immediate confirmation. This immediate feedback offers peace of mind, confirming that your tax obligations have been fulfilled on time.
• Global Convenience: E-filing allows you to submit your federal tax return from anywhere in the world, requiring only an internet connection. This feature is especially beneficial for expats living in remote locations or those who frequently relocate.

However, despite these benefits, certain tax situations necessitate mailing a paper income tax return. Whether it’s due to specific IRS requirements for certain deductions or the need to provide supplementary documentation, understanding when you must mail your return is critical for US expats.

WHEN YOU NEED TO MAIL YOUR TAX RETURN?

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Over the years, I have heard individuals and tax professionals raise various questions on the operation of the American Opportunity Tax Credit (AOTC at IRC 25A). This is the credit that for the past many years provides up to a $2,500 credit for each of the first four years of higher education at a college or university.  It started in the early 1990s as the Hope Scholarship credit for a lower amount and only the first two years of college.

There are numerous other tax breaks for higher education including an exclusion for scholarships, a limited above-the-line deduction for student loan interest, the Lifetime Learning Credit, an exclusion for interest on education savings bonds, 529 accounts, and more.

Some of the issues I have heard for the AOTC include:

• Do years at a community college count as part of the four years? I believe they do, but what if the student isn’t, at least at first, pursuing a degree?
• What are all of the expenses that qualify?
• What if the 1098-T received (and required to claim the credit) is incorrect in terms of the year or amount?
• Why does it only cover college or university programs rather than also trade schools and similar?

In the continuing effort to improve tax compliance and ensure fairness, the Internal Revenue Service announced a new effort on Feb. 29, focused on high-income taxpayers who have failed to file federal income tax returns in more than 125,000 instances since 2017.

The new initiative, made possible by Inflation Reduction Act funding, begins with IRS compliance letters going out this week. The mailings include more than 25,000 to those with more than $1 million in income, and over 100,000 to people with incomes between $400,000 and $1 million between tax years 2017 and 2021.

About 20,000 to 40,000 CP59 notices are anticipated to mail each week, beginning with filers in the highest income categories.

What is the CP59?

The recently updated CP59 notice is sent when the IRS has no record that a prior personal tax return(s) has been filed. It provides details on what a taxpayer can do to resolve their non-filing status:

• File their signed, personal tax return immediately or explain why a return is not required.
• Complete Form 15103, Form 1040 Return Delinquency, included with the notice to explain:
  • Why they’re filing late.
  • Why they don’t have to file.
  • That they’ve already filed.
• Detach notice stub and mail it with tax return and completed Form 15103 using the envelope provided. They can fax their information to the fax number in the notice using either a fax machine or an online fax service. Taxpayers should protect themselves when sending digital data by understanding the fax service’s privacy and security policies.

Newly revised CP59 notice

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