An official website of the U.S. Gov An official website of the U.S. GovRecently, I’ve received many questions about how Executive Order (EO) 14247, Modernizing Payments To and From America’s Bank Account, will affect taxpayers. The good news is that most taxpayers already receive their refunds using direct deposit and may not even be aware of the change. During the 2025 filing season, about 94% of individual taxpayers provided their direct deposit information on their Form 1040. But some taxpayers are unable to provide direct deposit information or may not wish to do so, and they may be wondering what the impact of the EO will be going forward.
All too often we turn on the news and hear of yet another disaster affecting hundreds of thousands of people and businesses. These disasters can upend every aspect of an affected individual’s life, including damage or destruction to their home, business, and critical documents. To assist taxpayers, the President may declare the event a federal disaster, which allows the federal government to help affected taxpayers under the Robert T. Stafford Disaster Relief and Emergency Assistance Act. Once this declaration has been made, the IRS will often provide these taxpayers with certain relief, most commonly by exercising its authority under IRC § 7508A to postpone certain tax deadlines, including filing and payment deadlines.
Despite all its challenges, the IRS processed 136 million individual income tax returns and issued 96 million refunds totaling $270 billion during the 2021 filing season. For those not familiar with IRS jargon, the term “filing season” is a term of art that includes income tax returns filed on or before the due date of the return, without considering returns filed after the due date or before the October 15 extension date.
Letter 4800C is mailed to taxpayers informing them that the IRS is proposing a deficiency or disallowing a claim for refund or a credit for a subsequent period’s estimated tax.
Unlike employees, independent contractors are responsible for remitting their own income tax payments, meaning they must make up to four estimated tax payments during the year.
The IRS resumed sending automated collection notices in January following a lengthy, but much needed, pause to address paper processing backlogs that built up during the pandemic. Recently the IRS began sending Intent to Levy notices, including Federal Payment Levy Program (FPLP) notices. The FPLP is an automated process the IRS uses to systemically levy federal payments owed to taxpayers, including Social Security benefits.
No matter what kind of collection notice you receive, don’t ignore it! Ignoring a collection notice can have costly consequences.
Here are some tips to assist you if you receive an IRS collection notice.
The 2022 Objectives Report presents an assessment of the 2021 filing season, identifies key objectives the Taxpayer Advocate Service (TAS) will pursue during the upcoming fiscal year, and contains the IRS’s responses to each of the 73 administrative recommendations the Advocate made in her 2020 Annual Report to Congress.
On Wednesday, January 12, 2022, I released the National Taxpayer Advocate’s 2021 Annual Report to Congress and the fifth edition of the National Taxpayer Advocate’s Purple Book, which presents legislative recommendations designed to strengthen taxpayer rights and improve tax administration for all taxpayers.
Taxpayer receives a notice or letter from the IRS and either chooses to respond to the notice or letter by paying their tax balance in full and/or filing missing tax returns; or pursuing a payment option; or the taxpayer chooses not to respond.
