Tax Lawyer's Blog

Last week the IRS National Taxpayer Advocate, Nina Olson, issued her annual report to Congress.  The report raises serious concerns about IRS continued use of overly aggressive tax collection practices.  These concerns had been addressed by Ms. Olson in her 2006 and 2007 annual reports and still have not been cured. Here is a snippet of what Ms. Olson reported to Congress:

The National Taxpayer Advocate’s 2006 Annual Report to Congress raised a number of concerns about IRS collection practices. Joint working groups have been established to work on five issues – levies, allowable living expense standards, installment agreements, offers in compromise, and early intervention techniques. However, the Office of the Taxpayer Advocate remains concerned about additional collection issues, including resorting to seizures before all viable collection alternatives have been exhausted, under-utilization of partial-pay installment agreements, and excessive delays in collection that exacerbate taxpayer delinquency problems because of the accumulation of interest and penalties. The IRS is working with the Office of the Taxpayer Advocate to address these concerns, and the collaboration will continue in FY 2009.

Unfortunately, I have had frequent first hand experience with IRS collection agents who use their vast powers to prematurely levy taxpayer’s wages and bank accounts. I recently had a case where we were dealing in good faith with an IRS Revenue Agent and in the middle of negotiations regarding the proper monthly payment amount a taxpayer could pay to the IRS the agent issued a wage levy on the taxpayer’s employer. 

After getting a desperate and irate call from my client, I called the Revenue Agent to find out why she had done this. Her answer was hard to believe. She said, “I called you yesterday to discuss this case and you didn’t return my call.” 

These are the kinds of actions that contribute to taxpayer movements to abolish the IRS. This was not only not “good faith” dealing, it was a violation of the taxpayer’s right to representation. By imposing on the taxpayer’s representative unreasonable deadlines for return calls this IRS agent effectively emasculated my client’s right to representation.

Hopefully for Nina Olson the third time is the charm and after issuing reports chastising IRS agents for overly aggressive actions in 2006, 2007 and now, again, in 2008, something will at last change.

However, I won’t be holding my my breath.

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