Steven Klitzner, the IRS Problem Resolution Attorney, joined Good Morning Keys on KeysTalk 96.9/102.5FM this morning to talk about tax issues.
Now is not the time to be complacent about any tax issues you might have.
Klitzner said there’s “less people over there, but more computer actions spilling out these notices, and they’ve actually started to take action and started levies on bank accounts and wages that they haven’t done since before COVID. Revenue officers do it, people on the field, but now the people at the 800 number, the computers are spitting out some levies, which drives people crazy, drives them into a tizzy.”
The IRS does have to adhere to the Taxpayer Bill of Rights.
Klitzner said, “There are 10 of them. We hold the IRS’s feet to the fire on these. I had one where I was talking to a territory manager, and I told him, they violated six of these and I went through them, not once, but twice with him and then the next day, the case went away. It’s funny how those things happen. The first right is the right to be informed. You have a right to know what you need to do to comply with the laws. You have a right to be informed of their decisions about accounts and receive clear explanations. The next one is the right to quality service, prompt, courteous, professional assistance. In other words, you should be able to call and speak to somebody. We know that doesn’t always happen, but technically, there’s a right to quality service. Now the next one is the right to pay no more than the correct amount of tax. But be clear, interest is part of the tax. They don’t just waive interest. Penalties only get waived if you have reasonable cause. So those are the first three. The next one is the right to challenge the IRS position and be heard. If you don’t agree with the IRS, you have a right to challenge that. You have a right to object to it. It’s not a unilateral decision that they can make. The next one kind of ties in with that, and that’s the right to appeal a decision with the independent office of appeals. Congress created the independent office of appeals. Yes, they’re part of the IRS, but they look at things more like judges. They look at our position, they look at the IRS position, and then they come to a fair resolution. The right to finality. That was a big one I had in that one case. I wanted it over. Let’s get an answer to this. You can’t just keep going on with a collection case or an audit case and let it go on forever and ever. We have the right to know when they have finished their work.”
What about the 10 year period?
Klitzner said, “The 10 years statute of limitations really helps a lot of people. You think, well, 10 years is so long, but every year I have clients save millions of dollars because the statute of limitations has run or is about to run. We had one client earlier this year saved several million dollars because of the 10 years. That was a wonderful thing.”
The next rule in the Taxpayer Bill of Rights is the right to confidentiality.
Klitzner said, “I had a Revenue Officer in my office several years ago, and he was, for whatever reason, taking phone calls from practitioners and taxpayers while I was there. I was listening on the cell phone, and they’re entitled to privacy. The funny thing was, he was telling people the same thing over and over again. He was just making up something and telling, no, I never did get that. Just fax it to me at this number to everybody that was calling. That was really not right, and then you get to the right to confidentiality, also that what you do is between you and the IRS. They can’t just leak your information to anybody else. Then the one I like the most, the right to retain representation. Taxpayers have a right to have somebody like me represent them, and the IRS does not look at my representation as a roadblock or a bad thing or an admission of guilt. They actually look at it as a good thing, because now the taxpayer has somebody that knows their rights so the case can get resolved. Finally, the right to a fair and just tax system. I always have trouble saying that with a straight face, because a lot of people don’t think it’s fair and just, and that is a right that taxpayers do have, that the IRS is supposed to follow. So whenever they miss any of these, whenever there’s something, whether it’s one or more of these, we can bring it up to a higher up at the IRS and hold their feet to the fire. They make common sense that you should have Bill of Rights. It’s just like in an audit case, somebody will call me and say they just audited me. I owe a million dollars. It’s like, no, they just sent you proposed changes. You have a right to fight this. They can’t just assess this against you. They can’t do things without giving you an opportunity to stop them. It’s when you pass that time up that you get into trouble.”
Are there any consequences if the IRS does violate the Taxpayer Bill of Rights?
Klitzner said, “There is a part of the IRS called the Treasury Inspector General for Tax Administration and they are the ones you can report IRS employees to, Treasury Inspector General for Tax Administration, and they will punish they will look into things. They will make sure that the IRS employee, whether it’s an officer, an agent, an appeals officer, doesn’t cross the line and violate any of these rights.”
With Independence Day coming up, it’s interesting that independence was declared because of taxation.
Klitzner chuckled, “Oh, that’s true. No taxation without representation. That was one of the great lines of all time, and now we’ve got the new law coming that looks like it’s going to pass at least most of it, which is going to cut taxes. People are going to have a little more money left over at the end of the year. I don’t have all the specifics yet. It’s not over yet, but just like the last time they did this, there were tax savings involved. A lot of it, though, they give you one thing and take away another. In other words, to give you an example with alimony, if, let’s just say, the husband’s paying alimony to the ex wife. It was deductible to the husband. The wife had to pick it up as income. They changed that. Now the husband can’t deduct it, but it’s no longer income to the wife. Technically, that means it probably should be a little bit less. Sometimes when they change something that you think, oh, that’s great here, they take it off somewhere else.”
Some employees have been cut from the IRS.
Klitzner said, “We lost a lot of people. We lost managers, we lost territory managers. We lost some very good revenue officers who had a lot of experience that understood their job. We also lost a lot of the new people that were just starting out. So what we have left are some experienced people, not as many as we had before, but fortunately, everyone in South Florida I’ve dealt with at one time or another, I’ve had multiple cases with, and that helps us be a lot more efficient and get cases resolved.”
Remember, don’t ignore the letters.
Klitzner said, “The certified letters are more important, but you can get ahead of them with the early letters. I can’t tell you how many times people call me after they’ve done something wrong, like let a deadline run, or after they call the IRS and start triggering off things that weren’t necessary to do. Call me first. I can make life a lot easier, and it makes my job a lot easier too, if I can control it as early as possible.”
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