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The Taxpayer Bill of Rights

Last month I presented an introduction to the area of my tax practice that deals with resolving tax debts.  I stated that there were basically five methods to resolve a tax liability; paying it, compromising it, discharging it, letting it expire, or abating it.  Starting next month I will be delving into these areas in more detail to hopefully provide some understanding of how the IRS collection process works. 

This month I will briefly discuss the Taxpayer Bill of Rights (TABOR) that was signed into law on July 30, 1996 by President Clinton.  Inasmuch as its purpose is to provide guidance to the taxpayer in complying with the Internal Revenue Code (Code) and to protect him in his dealings with the IRS, it is very important that he understands it.  Its provisions have been incorporated into the Code.  Basically, it provides for the following:

IRS employees are required to explain the taxpayer’s rights to him throughout the contact.

The taxpayer has the right to know why the IRS is requesting information, how it will be used, and what happens if he does not provide it.

The taxpayer must be treated in a professional, fair, and courteous manner.  If he believes that he has not been so treated, he should tell the employee’s supervisor and, if the supervisor’s response is not satisfactory, he should write to the IRS director for your area or the center where he files his return.

The taxpayer may choose to have another person represent him with proper authorization.  That person must be someone allowed to practice before the IRS, such as an attorney, CPA, or enrolled agent.  If, during an interview, the taxpayer decides he needs a representative, the meeting must stop and be rescheduled.  The taxpayer or his representative may make sound recordings of any meetings with examination, appeal, or collection personnel, provided the IRS is notified in writing 10 days before the meeting.

A taxpayer is responsible for paying only the correct amount of tax.  If he cannot pay it all when it is due, he may be able to make installment payments.

The taxpayer can call upon the Taxpayer Advocate Service if he has tried unsuccessfully to resolve a problem with the IRS

If a taxpayer disagrees with the IRS about the amount of his tax liability or certain collection actions, he has the right to ask the Appeals Office to review his case.

The IRS will waive penalties, when allowed by law, if the taxpayer can show he acted in good faith or relied on the advice of an IRS employee.  Interest can also be waived if it was the result of certain errors or delays caused by an IRS employee.


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