Dealing With IRS Collection
In dealing with IRS Collection, here is what you need to know. If the IRS thinks you owe them money, they will try and collect it from you. For personal taxes, this means they may take your property, your home, the money in any bank account with your name on it (bank levy), or have your employer send them money out of your paycheck (wage garnishment).
If you own a business, the IRS may seize your business property and assets including your equipment and accounts receivable. When the IRS starts contacting your customers demanding they send money to the IRS rather than you, many customers will stop doing business with you. Accounts receivable collections is one of the most damaging attacks by the IRS.
On cases where you owe over $25,000 the IRS will assign your case either to ACS- the Automated Collection System- which is nothing more than a telephone collection operation. Low level employees following scripts to solicit information from you that they will later use to destroy you.
IRS Revenue Officers
For cases that the IRS considers particularly serious, delinquent accounts are transferred to IRS Revenue Officers who conduct a field investigation of your tax liability and any potential sources of collection for the government. Revenue Officers are specially trained and are skilled members of the IRS Collections Divisions, with a wide range of collection tools at their disposal. Revenue Officers often will contact you at your home or place of business, issue summons requiring you to meet with them at the IRS field office, and may make surprise visits in certain cases. They also may summon third party records, such as bank account information and DMV records and can place liens, levies, and garnishments on employment wages/business income, bank accounts, and other assets.
Many Revenue Officers are nice people, but they wield a great deal of power and are the enforcers of the IRS Collections Division. The measure of their job performance is based on how much and how quickly they can collect delinquent tax owed. When it comes to collections matters, Revenue Officers are equally judge and jury and their decisions are presumed to be correct. Consequently, the taxpayer has the burden of proof when it comes to their case and must advocate to the satisfaction of the Revenue Officer. Revenue Officers have the upper hand in negotiations with individual taxpayers and they know it. Their great power means that leniency is usually in their sole discretion. Some will intimidate taxpayers in order to get them to pay their liabilities faster and some will take aggressive collection action to close a case quickly, even in relatively minor situations. Worse, some are deceptive, overly aggressive, and biased against delinquent taxpayers. Instances of Revenue Officer abuse and lawsuits alleging gross misconduct against them have been frequently documented over the years.
Hiring an experienced Enrolled Agent to handle your communications with a Revenue Officer immediately sends the message that you are serious about paying off your liability. Furthermore, Revenue Officers are more candid when dealing with a third party representative and will be less brazen when dealing with someone knowledgeable about the law and the limits of their power. Because the emotion associated with the collection process is removed, tax professionals can often negotiate a more effective resolution. Revenue Officers are less inclined to be emboldened in a professional setting when the possibility exists that they may deal with an attorney on other matters. Our office frequently deals with the same group of Revenue Officers in Tucson, Phoenix and San Diego and has established a great working relationship with them.
If contacted by a Revenue Officer, it is best to go on the offense and take a proactive approach when dealing with them. Please our office to schedule a free consultation, so we can discuss ways to help you handle your Revenue Officer.
For more information contact Richard Schickel at 520-448-3531