An official website of the U.S. Gov An official website of the U.S. GovTaxpayer 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 or pursues a payment option; or the taxpayer chooses not to respond.
Earlier today, Senator Mike Crapo, chairman of the Senate Finance Committee, and Senator Ron Wyden, the committee’s ranking member, jointly released a discussion draft of a broad and sweeping bill titled the Taxpayer Assistance and Service, or “TAS,” Act. The draft bill runs 163 pages and contains 68 provisions – about 40 of which reflect National Taxpayer Advocate recommendations. This is a big deal for taxpayers! This is a big deal for tax administration! If ultimately enacted, the TAS Act will rank with the IRS Restructuring and Reform Act of 1998 and the Taxpayer First Act of 2019 among the most significant pieces of taxpayer rights legislation Congress has passed. I encourage you to read the official press release from the Senate Finance Committee.
Looking back on the past year, I’m so proud of our TAS Team. It took a lot of coffee (and many pounds of sweets!), but with the help of tax practitioners and the IRS itself, we wrapped up another year of championing taxpayer rights. There’s an old saying that goes, “The days are long but the years are short.” It’s hard for me to believe, but this March will mark my fifth year as the National Taxpayer Advocate (NTA).
The Internal Revenue Service (IRS) needs additional information from you to process your income tax return.
The Notice CP503 (also referred to as the 2nd Notice) is mailed to you because the IRS still has not heard from you and you still have an unpaid balance on one of your tax accounts.
Letters 525, General 30-Day Letter, and 915, Examination Report Transmittal, are 30-day letters you receive when the audit of your tax return results in proposed adjustments.
Letters 525, General 30-Day Letter, and 915, Examination Report Transmittal, are 30-day letters you receive when the audit of your tax return results in proposed adjustments.
Today, I want to take a quick break from my deep dive into the discussion draft of the Taxpayer Assistance and Service Act to spotlight an important observance: National Small Business Week (NSBW), celebrated this year from May 4 – 10.
If you e-file, the IRS will notify you within 24 hours if your tax return was received and accepted or if it was rejected. The notification should explain why your return was rejected.
You received correspondence from the IRS requesting payment for the tax balance owing and the debt remains unpaid.
I previously discussed the significance of this potential legislation in terms of enhancing taxpayer rights. Over the course of several blogs, I’ve been highlighting some key provisions that, if ultimately enacted, would strengthen taxpayer rights and improve IRS operations. One such provision is Section 111, which focuses on making the IRS’s Offer in Compromise (OIC) program more efficient.
An OIC is an agreement between the IRS and a taxpayer to settle tax liabilities for less than the full amount owed. The overwhelming majority of OICs are submitted because the taxpayer says they cannot afford to pay the full tax liability within a reasonable time or doing so would create a financial hardship. In these cases, the IRS decides whether to accept an OIC primarily by performing a financial analysis that compares the taxpayer’s ability to pay (based on income and assets) with the taxpayer’s allowable living expenses.
