IRS announces its People First Initiative - IR-2020-59
TAX ALERT |
The IRS has announced its latest action to address the many challenges people are experiencing with the COVID-19 pandemic. With its People First Initiative, announced in IRS News Release IR-2020-59, the IRS has undertaken temporary extraordinary measures effective April 1 through July 15, 2020, to help taxpayers during these unprecedented times.
Suspension of certain collection actions
The IRS will suspend most lien and levy (including personal residence seizures) collection actions that are initiated during this period. This suspension includes liens and levies initiated by field revenue officers and automatically-generated liens and levies. In addition, the IRS will not forward newly delinquent accounts to private collection agencies during this period. The IRS will also suspend new passport certifications to the Department of State for taxpayers who are “seriously delinquent.”
Payments suspended under Installment Agreements and Offers in Compromise (OIC)
Payments due under an existing Installment Agreement or OIC are suspended during this period. By law, interest will continue to accrue on any unpaid balances though the IRS will not default on an Installment Agreement during this period. The IRS will not default on an OIC for taxpayers who are delinquent in filing their 2018 tax return. In addition, taxpayers who have submitted an OIC application will receive a grace period through July 15 to provide requested additional information regarding a pending application. The IRS will not close any pending OIC request without taxpayer consent before July 15, 2020.
During the period, the IRS will generally not start new field, office or correspondence examinations, but will do so only if it is necessary to preserve the government’s interest. The IRS will continue to work refund claims where possible but without in-person contact. In-person meetings with respect to current field, office or correspondence examinations will be suspended, but will continue remotely, where possible. In unique situations, the IRS will consider commencing an exam if the taxpayer desires and it is in the interest of both parties, in consideration of the latest COVID-19 developments. Notwithstanding these suspensions, taxpayers are encouraged to continue to comply with requests for additional information that they have already received or will receive.
Still business as usual in a few areas…
Not all collection actions are suspended during this period. The IRS will continue to issue deficiency notices and pursue necessary actions to preserve any applicable statute of limitation if the statutory period is set to expire during 2020. Therefore, the IRS is encouraging taxpayers to cooperate in extending those statutes to avoid the issuance of a deficiency notice. If a statute is not set to expire during 2020, the IRS will not likely pursue a deficiency notice to preserve the statute.
Even though IRS operations are curtailed for the unforeseeable future, the Office of Appeals will continue to conduct conferences with taxpayers over the phone or by videoconference. Therefore, the IRS encourages taxpayers to promptly respond to all correspondence from the Office of Appeals. The practitioner priority service telephone line will continue to be operational but with limited staffing resulting in increased wait times.
The IRS stated in the announcement that further information regarding the specifics of implementing these temporary measures will be forthcoming. Please see our previous alerts on IRS staff reductions and tax payment and filing relief.