Taxpayer Bill of Rights: The Right to a Fair and Just Tax System

From the Desk of Lauran Corcoran

Taxpayer Bill of Rights: 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.

What does The Right to a Fair and Just Tax System mean?

• If you cannot pay your tax debt in full and you meet certain conditions, you can enter into a payment plan with the IRS where you pay a set amount over time, generally on a monthly basis.

• You may request that the IRS remove any interest from your account that was caused by the IRS’s unreasonable errors or delays. For example, if the IRS delays issuing a statutory notice of deficiency because the assigned employee was away for several months attending training, and interest accrues during this time, the IRS may abate the interest as a result of the delay.

• The time limit for asking for the taxes you paid to be refunded may be suspended during the time you are unable to manage your financial affairs due to a mental or physical health problem.

• If you have acted with reasonable care you may be entitled to relief from certain penalties. Additionally, if you have a reasonable basis for taking a particular tax position, such as a position on your return or a claim for refund, you may be entitled to relief from certain penalties. Reliance on the advice of a tax professional can, in certain circumstances, represent reasonable cause for the abatement of certain penalties.

• The IRS cannot levy (seize) all of your wages to collect your unpaid tax. A portion will be exempt from levy to allow you to pay basic living expenses.

• The IRS must release all or part of a levy and notify the person upon whom the levy was made if one of the following situations exist: 1) the underlying liability is satisfied or becomes unenforceable due to the lapse of time; 2) the taxpayer enters into an installment agreement, unless the agreement specifies otherwise; 3) the release of the levy will facilitate collection of liability; 4) the IRS determines the levy is creating an economic hardship for the taxpayer; 5) the fair market value of the property levied is greater than the liability and releasing the levy on part of the property would not impair collection of the underlying liability.

If you missed last week’s post to Taxpayer Bill of Rights: Check it out: Taxpayer Bill of Rights: The Right to Confidentiality