TAXPAYERS BILL OF RIGHTS and What the IRS isn’t Telling You!

Did you know that only 11% of taxpayers know they have rights before the taxing authorities? Did you know you have rights before the IRS? Do you know those rights? Do you think the IRS is voluntarily going to enforce your rights?

The Tax Resolution Center, Inc. has been built on the commitment to provide top rated representation before the IRS and taxing authorities at an affordable price. Knowledge is power. Know your rights before the IRS.

Note: The following Bill of Rights is taken directly from the IRS website.

The Right to Be Informed: Taxpayers have the right to know what they need to do to comply with the tax laws. They are entitled to clear explanations of the laws and IRS procedures in all tax forms, instructions, publications, notices, and correspondence. They have the right to be informed of IRS decisions about their tax accounts and to receive clear explanations of the outcomes.

The IRS will not inform you about resolution options you may have to avoid paying taxes or penalties. Revenue Officers are not required to explain to you how to set up a plan in your best interest. They almost always set up every plan in favor of the government and you may pay thousands more depending on what you owe.  Do you know your rights and what questions to ask?

The Right to Quality Service: Taxpayers have the right to receive prompt, courteous, and professional assistance in their dealings with the IRS, to be spoken to in a way they can easily understand, to receive clear and easily understandable communications from the IRS, and to speak to a supervisor about inadequate service.

Congress cut the training budget for the collection division from $176 million to $22 million per year and Nina Olson, the Director or OPR (Office of Professional Responsibility) made her presentation to Congress in Dec. 2013 and said “It’s embarrassing that our government creates very complicated Tax Laws and our collection division can’t interpret or explain them properly.” (paraphrasing.)

The Right to Pay No More than the Correct Amount of Tax: Taxpayers have the right to pay only the amount of tax legally due, including interest and penalties, and to have the IRS apply all tax payments properly.

Did you know that if you don’t file a return, the IRS can file a substitute return for you or your business and can make up the amount you owe and that is the amount you legally owe!  You can amend that return if you know your rights.  Talk with an attorney and know your real rights before the IRS.

The Right to Challenge the IRS’s Position and Be Heard: Taxpayers have the right to raise objections and provide additional documentation in response to formal IRS actions or proposed actions, to expect that the IRS will consider their timely objections and documentation promptly and fairly, and to receive a response if the IRS does not agree with their position.

Most taxpayers are not versed in the legalese buried in the 17,000 pages of the IRS Code, so how do you object when you don’t know the rules? It takes an attorney to interpret the Code in your best interest.

The Right to Appeal an IRS Decision in an Independent Forum: Taxpayers are entitled to a fair and impartial administrative appeal of most IRS decisions, including many penalties, and have the right to receive a written response regarding the Office of Appeals’ decision. Taxpayers generally have the right to take their cases to court.

In the hands of an experienced attorney, the appeal process is a powerful tool to obtain a fair resolution over an over-zealous revenue officer.

The Right to Finality: Taxpayers have the right to know the maximum amount of time they have to challenge the IRS’s position as well as the maximum amount of time the IRS has to audit a particular tax year or collect a tax debt. Taxpayers have the right to know when the IRS has finished an audit.

Sure, you will know the audit is finished when the IRS sends you a bill saying pay this $$$$.   In  reality the audit is finished before you start if you don’t have  an understanding of the rules of the game.

The Right to Privacy: Taxpayers have the right to expect that any IRS inquiry, examination, or enforcement action will comply with the law and be no more intrusive than necessary, and will respect all due process rights, including search and seizure protections and will provide, where applicable, a collection due process hearing.

Only an attorney can invoke Client Attorney Privilege to protect your privacy. Unfortunately, we hear all the time where Revenue Officers visit a business and if the owner is not in will tell an employee they are from the IRS and need to speak to the owner and leave their card or if the door is locked they tape their card to the door for the world to see. 

The Right to Confidentiality: Taxpayers have the right to expect that any information they provide to the IRS will not be disclosed unless authorized by the taxpayer or by law. Taxpayers have the right to expect that appropriate action will be taken against employees, return preparers, and others who wrongfully use or disclose taxpayer return information.

This is great, but if you have anyone other than an attorney representing you, i.e., Enrolled Agent and even most CPA’s, you are not protected by Client Attorney Privilege.

The Right to Retain Representation: Taxpayers have the right to retain an authorized representative of their choice to represent them in their dealings with the IRS. Taxpayers have the right to seek assistance from a Low Income Taxpayer Clinic if they cannot afford representation.

The key word is authorized representative. The IRS created the position of Enrolled Agent (EA) a few years back and require EA’s to take an online course lasting about 4 months and then take a test. If they pass there are declared authorized to represent you. Even though they have zero legal training or ability to protect your legal rights. This is who the IRS prefers to work with. It’s easy to figure out why — EAs are not much more than paper shufflers and provide information to the IRS as they want it. An attorney understands the law, your rights and how to package your case and argue  in your best interest to get you the best work out while maintaining attorney client privilege. The really sad part: EAs are charging as if they were attorneys. This should be illegal!

The Right to a Fair and Just Tax System: Taxpayers have the right to expect the tax system to consider facts and circumstances that might affect their underlying liabilities, ability to pay, or ability to provide information timely. Taxpayers have the right to receive assistance from the Taxpayer Advocate Service if they are experiencing financial difficulty or if the IRS has not resolved their tax issues properly and timely through its normal channels.

All of this is warm and fuzzy reading — however, the system is not working this way. When Nina Olson, the director of OPR (Office of Professional Responsibility), says in her presentation to congress last December that the system is understaffed and under-trained and the taxpayer is receiving misinformation, bad information or no information — the system is broken.