Despite being the primary system that all income-producing American adults must interact with, the IRS and taxes tend to be something we aren’t very good at educating ourselves about. On top of that, the system can be very convoluted, overcomplicated, and quite frankly, a bit scary. This combination can often lead to the spread of misinformation and fear-based marketing campaigns related to how the IRS operates, and what resolutions are available to taxpayers.
For taxpayers who are attempting to address delinquent tax filings or set up arrangements to resolve a debt with the IRS, it is important to know the truth regarding how the IRS operates, what resolution options are available to you, and what the truth behind collection practices is. When setting yourself up for success in regards to resolving your back tax debt, it is important to debunk some heavily circulated myths surrounding the IRS.
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Myth 1 - IRS Agents
One hot-button issue currently is how the IRS is expanding by hiring 87,000 new agents and the myth that these agents will be armed and banging on the doors of taxpayers across the nation. It’s important to keep in mind that just because they are hiring, does not mean it will be a quick switch flipped when it comes to the level of aggression they will use in collections.
First, this total number of agents is to be hired progressively over the next 10 years. More agents, however, does mean that the IRS will have greater manpower to enforce the collection of back tax as these folks are trained and assigned to field collections.
Second, the IRS announced a major policy change that will end most unannounced visits to taxpayers by agency revenue officers.
The change reverses a decades-long practice by IRS Revenue Officers, the unarmed agency employees whose duties include visiting households and businesses to help taxpayers resolve their account balances by collecting unpaid taxes and unfiled tax returns. Unannounced visits have ended except in a few unique circumstances and will be replaced with mailed letters to schedule meetings.
So, while more IRS employees do not directly correlate to different or more aggressive collection tactics, it does mean an agent is likely to be assigned to your case sooner than in prior years. Getting on top of the back taxes before someone is assigned to your case is always a best practice and sets you up for greater success in reaching a resolution.
Myth 2 - Offer in Compromise
Another myth to look out for, and to be sure you are well-educated on prior to jumping into a sales pitch, is the Offer in Compromise or Fresh Start Initiative. Be sure you qualify for these programs prior to hiring anyone to negotiate on your behalf.
The Offer in Compromise program allows certain taxpayers to settle their debt with the IRS for less than they owe. While this program can provide great benefits to specific taxpayers, you must meet a very strict list of guidelines. If it were easy to settle our debt with the IRS, everyone would do it! So, be wary of anyone selling you on this type of program, especially if they’ve not already talked to the IRS about your specific account and reviewed your financial situation with you.
Myth 3 - Home Seizure
Another myth that can be damaging, and is often used as a way to scare folks, is that the IRS will seize your home. The IRS cannot legally make you homeless. While they can ask you to attempt to borrow against the equity in your home, they cannot force you to liquidate your primary residence.
With anything pertaining to the IRS, you want to be sure you are receiving reliable information from reliable sources. IRS.gov is the primary place to double-check any claims someone makes to you. Second to that, ATBS’ team of tax and tax resolution experts is here to be of assistance when it comes to any and all questions related to the IRS and your account with them.
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