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Taxpayer Advocate

Taxpayer Advocate Helps With Swift Resolution of Wage Levy

The Taxpayer Advocate Service (TAS) was established as an independent branch of the IRS to help taxpayers resolve collection matters when they are unable to do so with IRS collection personnel. We have found TAS to be an extremely professional and helpful group. The following is an example of how TAS helped expedite a successful resolution for a taxpayer facing economic hardship.

Taxpayer Smith owes back taxes for several years and also failed to file tax returns for two years. He received a Final Notice of Intent to Levy and Right to A Hearing (“Notice”) which permits the taxpayer to appeal the levy action known as a Collection Due Process Hearing (“CDP Hearing”).

The appeal must be filed within 30 days of the date on the Notice. Once the appeal is filed, the IRS is precluded by law from taking any levy action until the taxpayer’s appeal is completed. The appeal is conducted by a Settlement Officer who has not had any previous involvement with the case.

Taxpayer Smith did not request a timely appeal and meets with a tax resolution professional (“TRP”) approximately two months after receiving the Notice. The TRP files a request for an Equivalent Hearing (“EH”) which is similar to a CDP hearing. However, unlike a CDP hearing in which the IRS is prohibited from taking levy action until the hearing is completed, the IRS is not required to stop enforced collection action when an EH request is submitted. It is however IRS policy not to issue a levy while an EH is pending.

Two days after filing the EH request the TRP received a telephone call from Taxpayer Smith stating that a Notice of Wage Levy was issued to his employer and his wages were going to be levied. The IRS had sent the levy the day before the EH request was filed. The taxpayer indicated that if his wages were levied he would not be able to pay for his basic living expenses such as food, transportation and rent. The TRP immediately contacted the IRS collection officer who issued the levy and requested he release the levy due to economic hardship. He informed the collection officer the taxpayer’s unfiled tax returns along with a request for an installment agreement to pay the back taxes would be submitted within several days. However, the collection officer stated that since the levy had already been issued, he would not release the levy until he received the tax returns and request for the installment agreement.

Since a quick release of the levy was critical, the TRP immediately faxed a request for TAS assistance to the local Taxpayer Advocate office. In order to protect Taxpayer Smith, the TRP began preparing the unfiled returns and installment agreement request. He was contacted by TAS the following day and explained the situation. TAS immediately contacted the IRS collection officer and persuaded him to work with the TRP and release the wage levy which allowed Taxpayer Smith to pay for his living expenses.

As the TRP’s top priority was to protect Taxpayer Smith’s rights and avoid economic hardship he put his knowledge and experience to work by contacting TAS with the expectation that a speedy resolution would occur.

At East Coast Tax Consulting Group our TRP’s regularly help taxpayers faced with wage and bank levies. We will analyze your specific facts and circumstances and recommend a solution to your tax problems. Call us today at 866-550-7655 for a free consultation.

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You deserve the best in IRS tax representation, tax preparation, and tax planning services. At East Coast Tax Consulting Group, you’ll work with a licensed CPA who will handle your case from beginning to end. We invite you to contact our team to schedule a free, confidential consultation.