In a series of blogs I published earlier this year, Telephone Service in an Omnichannel Environment – The IRS Must Make Communicating with the IRS Over the Phone Easier for Taxpayers and Telephone Service in an Omnichannel Environment – The IRS Must Ensure Taxpayers Are Getting the Assistance They Need Over the Telephone, I explained why telephone communication is still an important way for taxpayers to get assistance from the IRS, even as the IRS expands its online self-help service options. In these blogs, I discussed how the IRS is failing to develop its telephone service as a vital part of an omnichannel communication environment, and thus failing to recognize the needs and preferences of taxpayers. In my 2017 Annual Report to Congress, I identified the limitations of the IRS’s telephone service as one of the Most Serious Problems encountered by taxpayers, and highlighted my concern that the IRS’s operational measures are overly focused on efficiency rather than the taxpayer experience. In this blog, I will further detail my concerns about the IRS’s reliance on the Accounts Management (AM) Customer Service Representative (CSR) Level of Service (LOS) as the benchmark measure to evaluate its phone service, as it can mask the struggles faced by taxpayers seeking assistance. Read more
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The IRS’s Level of Service Measure Fails to Adequately Show the Experience of Taxpayers Seeking Assistance Over the Phone
Your FATCA registration must always be updated with the current name and email address of your responsible officer and point of contact(s) as soon as there is a change.
When you complete a FATCA registration, you are asked to include the name and contact information of (1) a Responsible Officer (“RO”) and (2) a Point of Contact (“POC”). Specifically, among other information, you must provide their mailing and email addresses as well as their telephone numbers. Read more
To get a levy released, you’ll need to contact the IRS and give them an acceptable reason for releasing the levy. Generally, you can request a levy release if you’ve worked out a payment arrangement, are experiencing an economic hardship due to the levy, or the IRS failed to follow the correct procedures.
Releasing Continuous Levies
Levies can be continuous or one-time events. Bank account levies are one-time only. Wage garnishments and levies of certain federal payments, including Social Security retirement benefits, are continuous.
Today the IRS announced that eligible employers who provide paid family and medical leave to their employees may qualify for a new business credit for tax years 2018 and 2019.
In addition, eligible employers who set up qualifying paid family leave programs or amend existing programs by Dec. 31, 2018, will be eligible to claim the employer credit for paid family and medical leave, retroactive to the beginning of the employer’s 2018 tax year, for qualifying leave already provided. Read more
Employer payments or reimbursements in 2018 for employees’ moving expenses incurred prior to 2018 are excluded from the employee’s wages for income and employment tax purposes, the Internal Revenue Service announced today.
The 2017 Tax Cuts and Jobs Act (TCJA) suspended the exclusion from income for moving expenses reimbursed or paid by an employer for most employees starting in 2018, making these amounts taxable, except for amounts for active-duty members of the U.S. Armed Forces whose moves relate to a military-ordered permanent change of station. Read more
Individual Retirement Arrangements – better known simply as IRAs – are accounts into which someone can deposit money to provide financial security when they retire. A taxpayer can set up an IRA with a:
- bank or other financial institution
- life insurance company
- mutual fund
Here are some terms and definitions related to IRAs to help people learn more about how the arrangements work: Read more
When Will the IRS Levy Retirement Accounts?
The IRS can levy the assets in a qualified retirement account, such as a 401(k) or an IRA. However, the IRS will only levy retirement funds as a last resort. They would rather levy other assets, such as a bank account.
Before the IRS will levy a retirement account, they must abide by several pre-levy procedures.
First, the IRS will typically only levy retirement account funds if there has been flagrant misconduct, such as tax evasion, failure to cooperate with the IRS, or something similar.
The Internal Revenue Service today reminded taxpayers they have until Sept. 28 to apply for the Offshore Voluntary Disclosure Program (OVDP).
Since the OVDP’s initial launch in 2009, more than 56,000 taxpayers have used the various terms of the program to comply voluntarily with U.S. tax laws. These taxpayers with undisclosed offshore accounts have paid a total of $11.1 billion in back taxes, interest and penalties. The planned end of the current OVDP also reflects advances in third-party reporting and increased awareness of U.S. taxpayers of their offshore tax and reporting obligations.
Report Of Cash Payments Over $10,000 Received In A Trade Or Business – Financial Crimes And Automobile Dealership Transactions
Generally, any person in a trade or business who receives more than $10,000 in cash in a single transaction or related transactions must complete a Form 8300, Report of Cash Payments Over $10,000 Received in a Trade or Business (PDF). Form 8300 is a joint form issued by the IRS and the Financial Crimes Enforcement Network (FinCEN) and is used by the government to track individuals that evade taxes and those who profit from criminal activities. Although the cash reporting requirements apply to many types of businesses, auto dealerships frequently receive cash in excess of $10,000 and are required to comply with the filing requirements.
Tax Audit Time Frame
The Internal Revenue Service regularly performs tax audits of both corporate taxpayers and individuals. Although tax audits are conducted year-long, they often spike during the few months after the tax season, especially when problematic or misleading returns come under the IRS microscope.
Irrespective of when an “examination” or audit commences, an IRS auditor would be assigned to your case.
While IRS tax auditors are trained to be efficient, they’re also well trained to be comprehensive and thorough – and depending, to a large extent, on the structure and complexity of the individual or company’s tax situation, the IRS audit process usually takes more time than you may estimate as a taxpayer.
What Is A Collection Due Process Hearing?
A collection due process (CDP) hearing gives you one last chance to avoid a federal tax lien or tax levy. You will know you have a right to request a CDP hearing because you will receive a CDP notice. This notice is sent when any of the following IRS collection actions are being taken:
- Filing of a Federal tax lien
- Bank account levy
- Jeopardy Levy
- Levy on Your State Tax Refund
The IRS should send you this notice before taking the proposed actions, but there are some situations where they can send the notice of taking action. The important thing to note is that you have 30 days from the date of the notice to request a CDP hearing.
Request A Collection Due Process Hearing
By requesting a CDP hearing, you temporarily avoid the lien or levy. The IRS will typically not initiate the levy during the CDP hearing process. This gives you time to weigh your options.
The IRS is going to continue to pursue collection unless you give them a viable alternative. It’s always better to negotiate before they levy your assets than after.
We’re all responsible for paying our fair share of taxes each year. But what happens when the amount that you owe is simply out of reach? What happens if you failed to make payments in a timely manner and your financial circumstances have shifted to the point where your cumulative debt is beyond your ability to pay? In the face of this untenable position, your best option for paying the IRS may be what is known as an Offer in Compromise.
The Goal of the Offer in Compromise
The Offer in Compromise, or OIC, was created to accomplish two goals: it allows American taxpayers who are unable to pay the full amount of their tax debt a way to negotiate a payment that is in keeping with their ability to pay, while at the same time providing the IRS with the ability to collect at least a portion of the amount that is owed to them. The process is neither simple nor fast: it generally takes at least one to two years for both sides to come to an agreement on an amount to be paid.