The IRS penalized a taxpayer for missing the 60-day deadline for rolling over an Individual Retirement Account (IRA). The taxpayer was adamant that the rollover was made timely. However, it was the bank who recorded the transaction late, since the deadline came the week between Christmas and New Year’s, and the bank employee responsible, who was on vacation until after the new year, didn’t record the transaction timely. The taxpayer kept meticulous records and was able to verify the rollover date. The IRS had disregarded the taxpayer’s letters and would not remove the penalty from the taxpayer’s account. The case advocate secured copies of the taxpayer’s supporting documentation and submitted them to the IRS for further consideration. After several discussions with the IRS, the case advocate successfully advocated to have the penalty removed and the taxpayer’s account adjusted.
When working with the Taxpayer Advocate Service, each individual or business taxpayer is assigned to an advocate who listens to the problem and helps the taxpayer understand what needs to be done to resolve their tax issue. TAS advocates will do everything they can to help taxpayers and work with them every step of the way. Occasionally we feature stories of taxpayers and advocates who work together to resolve complex tax issues.