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Tag Archive for National Taxpayer Advocate

The Value of “Superseding” Returns And Processing Additional $500 Stimulus Benefit For Certain Non-Filers

NATIONAL TAXPAYER ADVOCATE

For the IRS, like much of the country, it seems like the focus in recent weeks has been “All COVID, all the time.” The IRS is playing a central role in administering the Coronavirus Aid, Relief, and Economic Security (CARES) Act and other federal relief efforts, most notably by issuing Economic Impact Payments (EIPs) to more than 150 million individuals. The legal, technological, and practical challenges the agency is facing are enormous, and the IRS has moved rapidly, skillfully, and creatively to tackle these challenges, albeit hitting some processing bumps in the road.

Notwithstanding the IRS’s best intentions and efforts, taxpayers continue to face significant challenges. One month after the enactment of the CARES Act, the IRS has issued 122 million payments for a total of 207 billion dollars. However, some eligible individuals have not received the correct amounts, some deposits have been sent to discontinued or closed bank or financial accounts, and some mailing addresses will still need to be updated. Taxpayers have also complained about the IRS portal, “Get My Payment.” Nevertheless, more than 100 million people to date have successfully verified the status of their payments, and more than 8.9 million people have provided bank or financial account information to accelerate their receipt of payments. That is no small feat. The IRS continues to try to remedy any issues that arise, while keeping an eye on preventing fraud. Yet there are many tax issues unrelated to EIPs that taxpayers continue to struggle with as well.

In this blog, I will highlight several topics:
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How To Request Levies And Liens Releases

NATIONAL TAXPAYER ADVOCATE

Some taxpayers may need some additional relief during the COVID-19 pandemic from existing federal tax liens and IRS levies on bank accounts, wages or property. IRS describes available relief in the People First Initiative. Taxpayer Advocate Service (TAS) would like to provide some simple instructions for taxpayers to follow, especially in situations causing economic hardship.

Levy Releases
A levy will not be automatically released. The IRS considers a taxpayer’s request to release a levy on a case by case basis if the levy is causing an economic hardship. “Economic hardship” means the levy prevents the taxpayer from meeting basic, reasonable living expenses. Please note the IRS may ask for additional financial information to determine if a levy is causing an economic hardship before deciding to release the levy.

To request relief:

If you are working with a revenue officer, contact the revenue officer directly.

If you are not working with a revenue officer, you must call the number provided on the levy notice.
Unable to reach the IRS by phone for levy release request?

If you are unable to reach an IRS representative by phone, fax your request to (855) 796-4524. The fax should include your name, address and social security numbers (for both spouses, if you filed jointly). Also, include the name, address and fax number of the employer or bank where the levy is being processed.

Note: This fax number is only used to address emergency levy release requests. Due to current limited staffing, the IRS will not respond to other issues sent to this fax line.

Lien Certificates
The IRS is processing all electronically submitted lien certificate applications (including lien releases, discharges of property from the federal tax lien, withdrawals of the notice of federal tax lien and subordinations of the federal tax lien) normally and assigning them within 10 days:

Currently, the IRS requests all taxpayers use the E-Fax line for their ACR site (844-201-8382) for submission.
Note: Due to Coronavirus, IRS is NOT processing lien certificate applications mailed to the Advisory Consolidated Receipts (ACR) site in Florence, Kentucky.

Publication 4235, Collection Advisory Group Numbers and Addresses (PDF), has additional information on the process for submitting applications for lien certificates and on related topics.

For more information on current IRS operations, see the IRS Operations During COVID-19: Mission-critical functions continue page and the IRS Coronavirus Tax Relief and Economic Impact Payments page.

Taxpayer Advocate Service Help

TAS is open to virtually serve taxpayers who find themselves in hardship situations or dealing with IRS tax problems they’ve been unable to resolve directly with the IRS. If you cannot get a lien or levy released, after making contacts as instructed above, go to our Contact Us page and call the local number listed for your state or area.

Please understand though, that TAS cannot currently help you get any Economic Impact Payments before the IRS releases them.

National Taxpayer Advocate Is Ready To Virtually Serve Taxpayers

NATIONAL TAXPAYER ADVOCATE

The health and safety of our employees, taxpayers and tax practitioners are the Taxpayer Advocate Service’s highest priorities. Despite the challenges presented by the National Emergency around the coronavirus (COVID-19), TAS is working hard to carry out its mission of helping taxpayers resolve their IRS tax problems and protecting taxpayer rights. While our taxpayers and employees are currently faced with uncertainty in their personal lives, we want to help ease the burden of unresolved tax matters and relieve hardships to the extent possible.

Just as others have needed to adjust how they presently conduct their work, so has the Taxpayer Advocate Service. Currently, TAS is operating in a virtual environment. We have suspended all face-to-face walk-in services until further notice, but TAS continues to serve taxpayers who need our help. We are virtually communicating with taxpayers by telephone, fax and mail as best as we can, given building closures and shelter-in-place limitations in parts of the country. Many of our employees, like their fellow citizens, are teleworking and are having to adjust to school closures, new care situations, and new work processes. We appreciate your patience and understanding as our employees strive to provide the best service possible as they adjust to these new work conditions.

Taxpayers who find themselves in hardship situations or with IRS tax problems they’ve been unable to resolve directly with the IRS may contact their local TAS office by phone. Telephone numbers to each of our offices can be found at taxpayeradocate.irs.gov/contact us. Currently, we are unable to answer calls to the IRS National Taxpayer Advocate’s Case Intake Line (877-777-4778), but again, we can be reached at the local phone numbers. Taxpayers may also visit our website for tax information on common issues and the latest developments regarding the coronavirus’s impacts to TAS’s operations.
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Implementation Of New TAS Case Acceptance Procedures For Theft Refund Fraud Cases

National Taxpayer Advocate On Fraud

The IRS uses certain “filters” to detect and prevent tax refund fraud. While these filters do stop a substantial amount of fraud, they also flag hundreds of thousands of returns each year that turn out to be legitimate. This causes refund delays and often creates financial hardships. Notably, the filters have produced a dramatic increase in the number of taxpayers seeking TAS assistance. TAS’s non-identity theft refund fraud case receipts have increased nearly five-fold over the past three years – from about 18,500 cases in calendar year (CY) 2017 to about 92,000 in CY 2019. Moreover, about 72 percent of the case receipts for CY 2019 were accepted under TAS’s “economic hardship” criteria. I wrote about this issue in a Most Serious Problem in my 2019 Annual Report to Congress.

Some background: The IRS’s Return Integrity Verification Operations (RIVO) function operates filters designed to identify suspected identity theft and other non-identify theft related instances of fraud. One of these filters is designed to identify cases where a taxpayer files a fraudulent return in his or her own name (e.g., the taxpayer claims his employer withheld $7,000 in federal tax when the employer only withheld $3,000, which, if not detected, would cause the taxpayer to receive a refund of $4,000 more than the correct amount). This non-identity theft filter is operated, in IRS parlance, by the “Pre-Refund Wage Verification Hold” (PRWVH) program.
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The Taxpayer Advocacy Panel Is Now Recruiting Volunteers Of Citizens

National Taxpayer Advocate Recruiting Volunteers

The Taxpayer Advocate Service (TAS) is your voice at the IRS. We take this statement seriously, as demonstrated by the work we do to help taxpayers resolve their tax problems. We do more than resolve problems, however. Part of our mission is to recommend changes that will prevent problems in the future. And in keeping with that part of our mission, we provide oversight and support for the Taxpayer Advocacy Panel (TAP), a federal advisory committee made up of citizens that listens to taxpayers, identifies major taxpayer concerns, and makes recommendations for improving IRS customer service and customer satisfaction.

The panel, established in 2002, consists of about 75 volunteers. To the extent possible, TAP members come from all 50 states, the District of Columbia, and Puerto Rico. In addition, one member represents U.S. citizens working, living, or doing business abroad or in a U.S. territory other than Puerto Rico. To be a member of TAP, a person must be a U.S. citizen, be current with federal tax obligations, and pass a Federal Bureau of Investigation criminal background check. Members cannot be federally registered lobbyists. In addition, current Department of the Treasury and IRS employees cannot serve on the panel, and former Department of the Treasury or IRS employees and former TAP members must have a three-year separation from their service to be eligible for appointment. Tax practitioner applicants must be in good standing with the IRS (meaning not currently under suspension or disbarment).
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Local Taxpayer Advocates Describe Most Serious Problems Experienced By Taxpayers

NATIONAL TAXPAYER ADVOCATE

During February, Taxpayer Advocates Service’s Local Taxpayer Advocates (LTAs) are in Washington, D.C., presenting the National Taxpayer Advocate’s 2019 Annual Report to Senators and House Members whose local offices they serve.

The law requires TAS to place at least one LTA in every state to assist taxpayers who are experiencing problems with the IRS. Over the past seven years, TAS has received an annual average of about 218,000 cases, and an annual average of about 15,000 of these cases (roughly seven percent), have been referred by congressional offices.

To facilitate coordination, TAS pairs every Senate and House office with an LTA office within the state the Senator or House member represents. LTAs work with congressional offices by sharing information about trends they are seeing in their casework and by partnering with them to disseminate information about filing deadlines, changes in the law, and other information that may be useful for taxpayers.

Once a year, typically around the first week of February, our Local Taxpayer Advocates go to Washington for our “Congressional Affairs Program.” During this “CAP” conference, they receive training on technical issues that they bring back to their local offices and teach to the case advocates they supervise, and they visit the Washington offices of the Senators and House members whose local offices they assist.
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NTA: Sharing Economy Tax Information

NATIONAL TAXPAYER ADVOCATE

Many taxpayers work or engage in services that are considered to be a part of the gig or shared economy services. These services often originate through peer-to-peer interactions such as ride-share programs, room rentals, and other freelance work.

Following the May 2016 hearing, Taxpayer Advocate Service worked with the IRS to create the information contained on the pages listed below to help you navigate the tax responsibilities which may apply when you work in the gig economy environment.

IRS Sharing Economy Tax Center
Watch video from the May 2016 House Small Business Committee testimony on the Sharing Economy: A Taxing Experience for New Entrepreneurs, Part I and Part II.

Related Articles: Self Employment Taxes

How To Confirm The Identity Of An Internal Revenue Service Field Revenue Officer If They Come Knocking At Your Door

IRS Visits Your Home

The Internal Revenue Service (IRS) has begun conducting face-to-face meetings with individual and business taxpayers as a part of a special compliance effort entitled Revenue Officer Compliance Sweep (ROCS). This is an extremely high priority effort where IRS field revenue officers (RO’s) will be working to resolve compliance issues, including missing tax returns and taxes owed, with a special emphasis on payroll taxes.

The RO’s will visit areas where there is little to no IRS presence. They will interview taxpayers while gathering financial information to help them become compliant now and remain so in the future. The new effort began Wisconsin, Texas, and Arkansas and will eventually rollout nationwide.

To avoid confusion with IRS scam artists and other imposters, the IRS will announce general details about these efforts in specific locations as an important step to raise community awareness around IRS activity during a specified time.

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IRS Publication Error May Have Caused Certain Married Taxpayers Filing Separately To Fail To File Required Tax Returns

TAS’s statutory mission is to resolve problems taxpayers encounter as a result of the way the IRS administers the nation’s tax code. In this blog, I would like to call attention to TAS’s efforts to correct an error in an IRS publication that may have led some taxpayers with a filing requirement to fail to file their returns.

Under section 6012(a) of the Internal Revenue Code (IRC), the filing threshold for married taxpayers filing separate returns from their spouses is the personal exemption amount, which was $4,050 in tax year (TY) 2017. In December 2017, the Tax Cuts and Jobs Act of 2017 (TCJA) suspended the personal exemption for TYs 2018-2025 (effectively reducing it to zero). As a result, taxpayers using this filing status face a filing requirement regardless of whether they worked or earned income in TYs 2018-2025. In light of Congressional intent underlying the TCJA, the IRS provided relief to married taxpayers filing separately by setting the filing requirement at $5. Both the IRS web site and the 2018 Instructions to Form 1040 indicate that a married filing separately taxpayer must file a tax return if the individual’s gross income is at least $5.

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National Taxpayer Advocate: Planning To Travel Outside The U.S. This Year? Don’t Risk A Passport Revocation

National Taxpayer Advocate

The Internal Revenue Service is urging taxpayers to resolve their significant tax debts, $50,000 or more, to avoid putting their passports in jeopardy. If you owe $50,000 or more and haven’t made payment arrangements, please contact the IRS now to avoid travel delays later.

Why is the State Department allowed to limit or revoke my passport due to unpaid taxes?

In December 2015, Congress passed the Fixing America’s Surface Transportation (FAST) Act. That act authorized the IRS to certify to the State Department taxpayers who owe a seriously delinquent tax debt. A seriously delinquent tax debt is an unpaid, legally enforceable federal tax debt totaling more than $50,000 (Please note that this amount is adjusted annually for inflation.) for which a notice of federal tax lien has been filed and all administrative remedies under IRC § 6320 have lapsed or been exhausted, or a levy has been issued. The IRS began certifying these debts to the State Department in 2018. Under the law, the State Department must deny your passport application and may revoke or limit your passport if the IRS has certified you as having a seriously delinquent tax debt. A seriously delinquent tax debt does not include non-tax debts collected by the IRS, such as the FBAR penalty and child support.

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National Taxpayer Advocate Objectives Report Features IRS Responses To Most Serious Problems (Volume 2)

National Taxpayer Advocate

Each December, the National Taxpayer Advocate identifies the Most Serious Problems facing taxpayers and makes recommendations for addressing them in the Annual Report to Congress (ARC). Each June, the National Taxpayer Advocate submits the Objectives Report to Congress, which includes a second volume that contains the IRS’s responses to our recommendations together with our analysis of the IRS’s responses.

As the Acting National Taxpayer Advocate, I believe it is important for taxpayers, tax practitioners, and Members of Congress to see how the IRS responded, and I will highlight a few examples of its responses and related analysis.

  • Most Serious Problem 1 – Tax Law Questions: The IRS has agreed to study the feasibility of returning to its previous practice of answering in-scope tax law questions year-round on the phones.
  • Most Serious Problem 2 – Chief Counsel Transparency: IRS Counsel has agreed to clarify the standards that should be considered when deciding whether legal advice should be issued in a formal memorandum.

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The Taxpayer Roadmap 2019 – A Lifeline For Taxpayers And Tax Professionals

Nina Olson The Taxpayer Roadmap

In the words of a comment made by one of our readers on a previous post on the taxpayer’s journey, “Whatever time and money was spent on this flowchart is some of the best taxpayer dollars ever spent! I am going to pretend my 2018 tax bill went towards this project, which will make me feel so much better about paying my taxes.”

With the road to tax compliance a very complicated one for many, the National Taxpayer Advocate Team spent a considerable amount of time illustrating the taxpayer’s journey from getting answers to tax questions; all the way through audits, appeals, collection and litigation. The road to compliance is complex to navigate and the reason you need a qualified tax expert to guide you through the process. Their stated goal is to expand on the Roadmap to include links in the future to guide you. On behalf of the TaxConnections community of taxpayers and tax professionals, we want to thank Nina Olson and the National Taxpayer Advocate team for an extraordinary job in building The Taxpayer Roadmap. We also want to thank Nina Olson for her outstanding service of 18 years.

TaxConnections Encourages Your Comments Today In Order To Thank National Taxpayer Advocate Nina Olson Who Retires on July 31st 2019. Great job Nina!

View The Taxpayer Roadmap 2019.