Nightmare: you've been called to a meeting with an IRS agent to discuss your tax return, and you can't afford professional help. Did you know that you could have someone help you at low cost or even free? It’s one of your rights as a U.S. taxpayer.
You may know about the Bill of Rights, but were you aware that the IRS also has a Bill of Rights for your benefit? Here are your ten fundamental rights known as the Taxpayer Bill of Rights:
The Right to a Fair and Just Tax System – You have the right to expect the IRS to consider special circumstances that affect your tax liabilities, your ability to pay, or your ability to provide necessary information. You also have the right to assistance from the Taxpayer Advocate Service.
The Right to Confidentiality – You have the right for your confidential tax information to remain confidential unless you authorize its disclosure. IRS employees who violate these rules will be subject to appropriate disciplinary action.
The Right to Be Informed – You have the right to clear explanations of all the tax laws and the corresponding IRS procedures throughout all IRS publications and correspondence. Taxpayers must be notified regarding any IRS decisions involving their account and the outcome must be fully and clearly explained. (Unfortunately, their explanation might not make the tax code seem any simpler.)
The Right to Pay No More than the Correct Amount of Tax – You have the right to pay only the amount of tax that you legally owe, including any accrued interest and penalties. The IRS is also obligated to apply your tax payments correctly.
The Right to Privacy – You have the right to expect that all IRS actions regarding your account will comply with the law. Actions must not be more intrusive than necessary and should respect all rights of due process.
The Right to Challenge the IRS's Position and Be Heard – You have the right to object to an IRS action and provide documentation to support your claim. The IRS is obligated to consider the objections fairly and promptly, and to send a response to the taxpayer if they disagree with the claim.
The Right to Appeal an IRS Decision in an Independent Forum – You have the right to appeal IRS decisions and receive a "fair and impartial" hearing from the Office of Appeals. Many tax penalties are included within this right. The IRS is obligated to send you a written response to notify you of the decision. In addition, you generally have the right to take these cases to court.
The Right to Retain Representation – You have the right to an "authorized representative" of your choice to represent you before the IRS, and to acquire assistance from a Low Income Taxpayer Clinic if you can't afford a qualified representative.
The Right to Quality Service – You have the right to "prompt, courteous, and professional" help in your communications with the IRS. Thanks to budget cuts, this has been a difficult one for the IRS to achieve in recent years. The IRS produced 8.8 million "courtesy disconnects," aka telephone hang-ups, during the 2015 tax-filing season that ended in mid-2016. They have pledged to improve on this each year, but according to the National Taxpayer Advocate Nina E. Olson's 2018 Annual Report to Congress, released on February 12, 2019, the recent government shutdown has made a substantial impact on IRS operations and services. In the first week of the tax filing season in 2018, the IRS answered 86% of calls directed to a telephone assistant in the Accounts Management department, with an average wait time of four minutes. During the first week of the 2019 tax filing season, however, only 48% of these calls were answered and the average wait time more than quadrupled to seventeen minutes. Similarly, 65% of calls to the Automated Collection System were answered in 2018, and callers waited an average of nineteen minutes. This season, only 38% of taxpayers calling this line got through, and they had to wait an average of 48 minutes.
"The five weeks [of the shutdown] could not have come at a worse time for the IRS—facing its first filing season implementing a massive new tax law, with a completely restructured tax form," noted Olson in the preface to her report. "The IRS is entering the filing season inundated with correspondence, phone calls, and inventories of unresolved prior year audits and identity theft cases." If you would like to prevent identity theft, monitor your credit, and even get insurance for up to $1 million in damages, join MoneyTips.
The Right to Finality – Finally (sorry, we couldn't resist), you have the right to know all deadlines for challenging IRS positions, IRS collections of tax debt, and the window of time for an audit in any particular tax year. "Anybody of any income level can potentially get audited," reminds Betterment Head of Tax Eric Bronnenkant. He suggests, "…that people prepare their taxes honestly and truthfully, and also be able to support what they put on their return in the event they get audited."
Each right has a secondary link on the IRS website that explains it in greater detail. Read all about these rights, and make sure to understand them when you are engaged in dealings with the IRS. We hope that you will never have a reason to remind the IRS of any of these rights.
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