Steve Klitzner, tax attorney with Florida Tax Solvers, joined Good Morning Keys on KeysTalk 96.9/102.5FM this morning to talk about what’s going on with the IRS.
With changes in the administration in Washington, DC, what changes can we expect at the IRS?
Klitzner said, “The IRS people, like the other government people, got the email asking them, even if they wanted to resign and get eight months of pay. Most of the people that I’ve talked to at the IRS, I’ve talked to people at various levels. Most of them aren’t taking the deal. The ones that are considering it are the ones that are retiring anyway this year, and also the new ones who know they’re going to get laid off, but they’re really in a bit of a state of panic. Here’s the other problem. If you got elevated, for instance, from revenue officer to appeals officer, and it’s been less than a year, you could get laid off, even though you’ve been with the IRS for 20 years, because it’s a new position. I have an audit today, a meeting with an auditor today, and yesterday, I got a call from her manager saying, yeah, she’s not with us anymore. She got laid off. We’re going to have to reassign the case. So far they’ve laid off, I see different numbers, 6,000 and it could climb as high as 7,000, even the acting commissioner, Doug O’Donnell, who is ready to retire anyway. This is the second time he served as acting commissioner. Between commissioners, he decided to step down, and he’s retiring immediately, rather than at the end of the year. So we’re seeing it all over. This, of course, is going to affect taxpayers in a lot of different ways.”
How exactly will if affect the county?
Klitzner said, “Not all of the people they’ve laid off even deal with taxpayers. I mean, there’s going to be IT people, people that do maintenance, people that are the cleaning crew. I mean, it could be anybody at the IRS, not necessarily somebody that you’re going to hear from, but I think the biggest problem taxpayers who pay their taxes on time are going to have is that their refunds, especially if it’s a large amount, may be delayed and that’s going to be something where, people call me all the time, can you get my refund back quicker? They’ve delayed it. They’ve said six weeks, they’ve said eight weeks. Really, I can do things, but it’s not going to speed it up, and that’s going to be a problem. Now, if you owe the IRS money, yes, there’s going to be less of a chance that they assign it to the field, because they’ll have less people in the field to assign it to, and the people at the 800 number who, before COVID, were levying and filing liens. They’re not doing that anymore. So you do have a reprieve in time, but with penalty and interest if you file your return today and owe $10,000 and say, they’re not coming after me. I’m not going to pay it. I’ll deal with it. The IRS has 10 years to collect. If you file late and you don’t pay it in five years, now you owe $20,000 and they’re not waiving the penalty and interest. So if you really, as Clint Eastwood said, you feel lucky, punk. If that’s the case, okay, maybe you try it, but I don’t think it’s a great gamble, because it’s going to rise very quickly over the years.”
The IRS really is a very complex agency with a lot of procedures that people really are unaware of.
Klitzner said, “They have enough problems taking care of things, but with less money and less workers, it’s going to be even worse. They hired a lot of new revenue officers. I was talking to one, and she was three weeks away from her one year, and she didn’t make the one year, and off she goes. It’s just unfortunate that they were finally really boosting up and they’re talking about hiring 90,000 new people, but that was barely making up all the people in the next 10 years that are retiring or moving on to something else, so they’re really going to have a difficult time over their audits. I think we’re not going to quite see as much from a real auditor standpoint, but those correspondence audits that the computer spit out, those should keep coming along. So don’t play fast and loose with your tax return and figure nobody’s going to catch it. If that tax return scores high with being kind of out of whack, you have a very good chance of getting audited.”
Collections will also continue.
Klitzner said, “There’s some things we do, some strategies we do, that protect our clients from a federal tax lien, certainly protects them from ever having their passport certified, which the IRS will not renew, which the State Department won’t renew or could technically revoke. We can, of course, keep people from their bank accounts and from getting levied with their paychecks. But we have to be on the case. We have to have the transcripts. We have to react to things, and sometimes our best strategy is just to make voluntary payments to the periods best for us and our clients. Sometimes, before the IRS knows it, it goes away before they can even take enforcement action.”
What is the taxpayer rights bill in Washington?
Klitzner said, “There’s a new bill. It’s a bipartisan bill, Taxpayer Assistance and Service Act, and what they’re proposing in this bill, it’s almost like they’ve read my diary. They are closing some IRS loopholes. They’re going to make it easier for taxpayers. It’s really a fantastic bill. If it goes through, it’s just seriously, everything that we’ve thought for years needs to be changed, they really did a great job on it, and they’ve been working with the Taxpayer Advocate on it. So a lot of what the Taxpayer Advocate has advocated over the years, they’re trying to put into effect, which I think will be great for taxpayers. It’s not going to mean you don’t owe the money, not going to mean that they stopped interest and penalty, but they’re going to make it easier, and they’re going to expand their rights so they can fight things easier than before.”
Is there ever the possibility that they will just outright abolish the IRS?
Klitzner said, “No, that’s not going to happen, folks. If they do, they’re going to need an agency to collect taxes, which that’s kind of the IRS already. So they’re not going away. They can’t go away. They’re the only government agency that actually collects money. Even though politicians go after the IRS all the time and criticize them and promise taxpayers, they’re going to get rid of them or lower the taxes. Yes, the taxes may lower, but we’re still going to be paying the IRS. They’re going to be around for a long, long time to come.”
If you’ve not filed your taxes in a while, it’s never too late to start abiding by the law.
Klitzner said, “Without question. It’s time to catch up. When the IRS backs down, when they back away, when they’re not taking enforcement, don’t also take a vacation. That is the time to get ahead of this. So by the time they do come after you, you’re ready, you’re prepared, and you can get it resolved. You don’t want to be playing defense. You want to look at everything now and come up with a plan now.”
Klitzner was formerly on the Advisory Council of the IRS.
He said, “I did not get an email offering me to resign, so I’m not going anywhere. I think some of these IRS people may have trouble with five things, but we’ll see how that plays out. Different agencies are handling it in different ways.”
The consultation to talk with Klitzner is always free.
HE said, “If I can help now, I tell people I can help them. Now, if I can’t help yet or there’s not much I can do, I tell people the same thing. Most of what I do, people can’t do on their own, but sometimes they can. If it’s small, if it’s something it’s easier for them to do, I always tell them that.”
For more information, click here: https://floridataxsolvers.com/