What is the Taxpayer Advocate Service?
The Problem Resolution Program was originally created in 1977 to address taxpayer problems that were not promptly or properly resolved by the IRS. In 2000, this office was reorganized by legislation into the Taxpayer Advocate Service (TAS). According to their mission statement, the purpose of the TAS is to “help taxpayers resolve problems with the IRS and recommend changes that will prevent the problems.”
Who Can Qualify for TAS Assistance
Not every person who has a tax issue is eligible for TAS assistance. However, the TAS has established broad definitions as to who can qualify for assistance. The criteria is as follows:
• Experiencing economic harm or significant cost (including fees for professional representation),
• Experienced a delay of more than 30 days to resolve your tax issue, or
• Not received a response or resolution to the problem by the date that was promised by the IRS.
• About to experience an immediate threat of adverse action.
• Will suffer irreparable injury or long term adverse impact if relief is not granted.
• A system or procedure has either failed to operate as intended, or failed to resolve the taxpayer’s problem or dispute within the IRS.
• The manner in which the tax laws are being administered raises considerations of equity, or have impaired or will impair taxpayers’ rights.
• The National Taxpayer Advocate (NTA) determines compelling public policy warrants assistance to an individual or group of taxpayers.
As you can see, many of the common issues a taxpayer may face falls within one of the above categories. A simple threat of an imminent levy or tax lien would likely qualify the taxpayer for TAS assistance.
On the other hand, the TAS generally will not assist a taxpayer with tax preparation or tax avoidance issues, such as how to minimize or avoid paying federal taxes. The TAS will also not assist taxpayers regarding the constitutionality of taxes.
TAS Assistance
There are two types of powers delegated to the TAS: delegated and statutory.
Delegated Powers
The TAS has numerous delegated powers covering a broad range of issues. However, only the powers most applicable to middle- and lower-income taxpayers will be discussed below.
The TAS is authorized to place a taxpayer into Currently Not Collectible (CNC) status, set up an Installment Agreement (IA), adjust Trust Fund Recovery Penalties (TFRP), release liens, and lift systematically generated levies. Of course, the usual criteria needs to be met for any of the above. Additionally, cases that are open in another IRS function, such as examinations, are excluded. They also cannot overrule determinations made by employees of other IRS functions who have been delegated comparable authority, such as collections.
For example, if a taxpayer were attempting to set up an IA with the TAS, they would have to go through the same process as they would with the IRS’s Automated Collection Service (ACS), such as disclosing financials, providing supporting documentation as needed, and being in compliance in filing all required prior years’ tax returns. However, the TAS process is not as simple as a telephone call. The taxpayer will need to wait for a call back from a TAS officer before proceeding with an IA whereas the IA process begins immediately as soon as the IRS is contacted.
Regarding tax levies, the TAS does have the authority to release all levies, but only systematic levies. Systematic levies are levy’s issued on payments from the federal government, such as social security checks. Levies on wages or accounts receivable are non-systematic levies and the TAS is unable to release these levies. The TAS would have to contact ACS personally to release non-systematic levies.
The process and qualifications for releasing federal tax liens and adjusting TFRPs are the same as contacting the IRS directly. The TAS does not have any more ability to release a lien for a taxpayer that owes $50,000 than ACS, if the taxpayer cannot meet the normal lien subordination criteria.
Statutory Powers
Statutory Powers on the other hand are much more expansive than delegated powers. The TAS can issue a Taxpayer Assistance Order (TAO) that directs the IRS to take specific action on a taxpayer’s case. However, TAOs can only be issued to prevent an extreme financial hardship or if there is a likelihood that a taxpayer will incur irreparable harm or long-term adverse impact. A TAO can also be issued if there has been a delay of more than 30 days in resolving the taxpayer’s account problems.
For instance, if the TAS determines that a taxpayer is suffering from an extreme financial hardship and has no ability to make any payments to the IRS, the TAS can issue a TAO for the IRS to reconsider a determination that the taxpayer has an ability to pay. TAOs can also be issued to the IRS to expedite a review of a taxpayer’s case such as when a CNC request has been sitting in a manager’s inventory for more than 30 days.
However, the circumstances where the TAS will actually issue a TAO are extremely limited. Even in instances where they would issue a TAO, it is likely to be no more effective than the taxpayer simply contacting the IRS. For example, if a CNC request has not been reviewed by an IRS manager after 30 days, contacting the IRS directly will likely result in a re-submittal for another manager to review it, the same result as if a TAO were issued.
Contacting the TAS
The TAS can be contacted through a single toll-free telephone number: 877-777-4778. This number can direct the caller to one of the many TAS field offices. However, the caller is not directed towards a TAS officer. Instead, the caller is routed to a TAS operator who will screen the caller to determine if the caller qualifies for TAS assistance. If the TAS operator determines that the taxpayer does qualify for assistance, the operator will queue the taxpayer to be assigned to a local TAS office. The operators are not able to resolve a caller’s problem. The caller will need to wait until they are contacted by an assigned TAS officer, which should occur within 48 hours.
Usefulness of the TAS
The TAS is part of the IRS. They may claim to be independent of them, but the TAS is a branch of the IRS, which poses a conflict of interest. Imagine a referee for a basketball game that was under the payroll of one of the two competing teams.
Having said that, there are some circumstances where contacting the TAS would be beneficial. Under specific circumstances, usually gross misconduct or unreasonable delay by the IRS, the TAS can be a helpful alternative. For the majority of taxpayers, however, it is usually just as efficient and effective to pursue relief directly with the IRS.
The TAS is most useful as it relates to IRS Revenue Officers. If a taxpayer’s case is hanging in limbo because a Revenue Officer has not been assigned, the TAS can expedite the assignment. In addition, if there is an overly aggressive or insubordinate revenue officer who will not consider the taxpayer’s financial condition, then the TAS can be a viable alternative to resolve the issue. Absent a Revenue Officer issue, however, it is more often in the taxpayer’s best interest to pursue their issues directly with the IRS.
Source: RoniDeutch.com
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