application for taxpayer assistance

8/14/2019 Application for Taxpayer Assistance

1/5

TAXPAYER ASSISTANCE ORDERS

By: Robert E McKenzie

Effective January 1, 1989, a taxpayer gained the right to apply to the Office of Ombudsman, now known as

the Taxpayer Advocate, for assistance if he or she is suffering or is about to suffer significant hardship as a

result of the manner in which Internal Revenue Laws are administered [IRC 7811]. For the first time

taxpayers have the statutory right to appeal unreasonable decisions by collection officers. If your request for

a payment agreement is unreasonably denied, you may request a Taxpayer Assistance Order (TAO) which

may require collection personnel to release property levied upon or to cease any action or refrain from anyaction with respect to the taxpayer [IRC 7811(b), Exhibit 3]. A request is initiated by filing Form 911 with

the local Taxpayer Advocate r. The mere existence of these rights tends to mitigate the unreasonableness of

some collection personnel. Don't continually threaten an appeal for a TAO but be aware of your rights. Don't

let a collection employee badger your client. You must establish that the collection actions will cause your

client significant economic hardship to receive a Taxpayer Assistance Order.

1.

TAXPAYER ADVOCATE SERVICE

22.10 The Problem Resolution Program was created by the IRS in response tocongressional criticism of the Service's lack of responsiveness. [Problem ResolutionProgram Handbook, IRM 1.2.1.9] The intent of the program was to give the taxpayer aplace to go when the normal channels of the bureaucracy fail to correct problems. Overthe years legislation first created a Taxpayer Ombudsman who in turn became thepresent Taxpayer Advocate. The Internal Revenue Restructuring Act of 1998 grantedthe Taxpayer Advocate greater authority and independence and created the Taxpayer

Advocate Service. The Taxpayer Advocate Service helps taxpayers resolve problemswith the IRS and recommends changes to prevent the problems.

2.

Taxpayer Advocates

22.20 The Internal Revenue Service Restructuring and Reform Act of 1998 (RRA '98)


2/5

amended Internal Revenue Code sections 7803 and 7811, creating the position of theNational Taxpayer Advocate and strengthening the Taxpayer Advocate organization bymaking it independent within the IRS. In the spirit of the legislation and the IRS'modernization, the Advocate Organization was restructured, the mission statementrevised and the organization renamed the Taxpayer Advocate Service. The TaxpayerAdvocate Service (TAS) officially began operation as a modernized organization onMarch 12, 2000.

Mission

22.30 The Mission of the Taxpayer Advocate Service is to help taxpayers resolveproblems with the IRS and to recommend changes to prevent the problems. Theorganization fulfills its mission through taxpayer casework and through advocacyinitiatives. TAS handles not only cases in which a taxpayer is suffering or about tosuffer a significant hardship, but also cases in which the taxpayer, while notexperiencing a hardship, would benefit from the involvement of TAS. Where TAScannot provide a remedy for taxpayers because of deficiencies in administrative

procedures or barriers imposed by the tax law, TAS will propose administrativesolutions or legislative changes, as appropriate.

Geographically Based Organization

22.40 Unlike most of the IRS, the Taxpayer Advocate Service continues to be ageographically based organization. The field organization consists of nine AreaTaxpayer Advocate Directors, seven of whom oversee casework by Local TaxpayerAdvocates in assigned territories and two of whom oversee casework from Local

Taxpayer Advocates in service centers. The field organization also includes twoOperating Division Taxpayer Advocates, who are responsible for systemic analysis andadvocacy. Both the Area Taxpayer Advocate Directors and the Operating DivisionTaxpayer Advocates report directly to the National Taxpayer Advocate. Seventy-fourLocal Taxpayer Advocates report to the Area Taxpayer Advocate Directors and areresponsible for handling taxpayer cases at the local level.

All Categories of Taxpayer Issues

22.50 Since TAS is structured around geographic rather than taxpayer segments,Taxpayer Advocates will handle all categories of taxpayer issues, irrespective of thesubject matter, in their assigned territories. Thus, all taxpayers in a specific locality willgo to the same advocate office, whether the taxpayer is a small business, a largecorporation, a wage earner or a government entity. Local and area advocates will dealprimarily with casework issues, i.e., issues involving specific taxpayers rather thanbroad organizational issues.

3.

Organizational Issues


3/5

22.60 Broad organizational issues are handled by the Advocacy Analysts assigned toand remotely managed by the Operating Division Taxpayer Advocates. Advocacyissues are generally those issues that impact a large segment of taxpayers or areissues that recur with some frequency. Depending on the nature of the problempresented, Advocacy Analysts will recommend either administrative solutions to the IRSor legislative solutions to the Congress through the National Taxpayer Advocate'sAnnual Report.

4.

Criteria for Assistance

22.70 The TA was established to streamline and resolve problems which the taxpayer had triedunsuccessfully, through the appropriate channels, to resolve earlier. Therefore, the formula to usewhen making a referral to a Taxpayer Advocate is to state that you (the representative or thetaxpayer) have previously sought to resolve the problem and to detail those steps and actionswhich were taken in that effort. The problems most often encountered by the TAS are:

Improper correspondence audits;

Lost refund checks;

Missing or incorrectly applied payments;

Failure of the Service to comply with requests for a statement of interest paid on accounts;

Cases where an audit reconsideration is warranted but where Collection Division personnelhave denied that Consideration; and

Refusal of an employee to furnish information, such as transcripts of accounts or anaccounting of how payments were posted to the taxpayer or his representative upon request.

The above is not meant to be an all-inclusive list. The TAS is empowered to intercede any timethere is a problem that is not being resolved through normal channels.

1.

Requesting Assistance


4/5

22.80 The best way to approach the Taxpayer Advocate is by a letter thoroughlydocumenting the facts of the case and attaching all pertinent exhibits as well as a copyof your power of attorney. If time is of the essence, a telephone call will generallycause a stay of any collection action on the account. If the matter is of an urgentnature, the practitioner should call the Taxpayer Advocate and set an appointment.Practitioners have found that one-on-one personal contact is the most effective methodof dealing with the TAS. Attached as an exhibit at the end of this chapter is a list ofaddresses and telephone numbers of IRS Taxpayer Advocates in each state. [See App

2-1] Also shown are the addresses of Service Center Taxpayer Advocates.

LTA Actions

22.90 Upon receipt of a request for assistance, the TAS will take steps to cause thesystem to suspend actions during its investigation. A freeze will be placed on theService Center computer to prevent notices and levies. If SB/SE personnel are workingon a case, the TAS will instruct them to cease actions pending resolution of the matter.

Resolution of Problems

22.100 Once steps have been taken to stop the normal processes, the TAS willresearch the problem and make efforts to correct it. Practitioners have found that TASstaff are cooperative and diligently try to resolve problems. Area Office TAS haveproven to be much more cooperative and effective than Service Center TAS staff.

Significant Hardship

22.110 A taxpayer may apply for a taxpayer assistance order if an IRS action orproposed action would cause significant hardship. The IRS Restructuring & Reform Actof 1998 expanded the definition of "significant hardship" by including the followingcircumstances [Act 1102; IRC 7811]:

2.

The existence of an immediate threat of adverse action.1.

A delay of more than 30 days in resolving the taxpayers account problems.2.

The payment by the taxpayer of significant cost (including fees for professional services) ifrelief is not granted or;

3.

1.

Irreparable injury or a long-standing adverse impact, if relief is not granted.1.


5/5

Nonexclusive

22.120 The list is not intended to be exclusive. A Taxpayer Assistance Order (TAO) may also beissued in any case in which the taxpayer meets other requirements that will be spelled out inregulation. [IRC 7811 (a)(1)(B)] The ranks are to be based in consideration of equity. If theInternal Revenue Service has failed to follow published guidance, including the Internal Revenue

Manual, the Taxpayer Advocate is required to construe the facts taken into account in a mannermost favorable to the taxpayer. [IRC 7803(c)(2)(B)(ii)] The TAO requirements became effectiveJuly 22, 1998.

Application for Taxpayer Assistance Order

22.130 The prescribed form for an Application for Taxpayer Assistance Order is Form 911 or asigned written statement which identifies the taxpayer, and, where possible, the Service personneland office involved, and which describes the Service's action and the significant hardship which

has occurred or will occur as a result of the manner in which the Internal Revenue laws are beingadministered. [Regs 301.7811-1(b), 301.7811-1 (a)(4)]

1.

22.140 National Taxpayers Help Line (IRS)

Internal Revenue Service

(877) 777-47782.

Practitioner Priority Service

22.150 Beginning January 2, tax practitioners could call the IRSs new nationwide hotline. The newPractitioner Priority Service professional support line will be staffed by IRS customer servicerepresentatives specially trained to handle practitioners account related questions. PractitionerPriority Service will be open weekdays from 7:30 a.m. to 5:30 p.m. local time

1. See Internal Revenue Manual,

COPYRIGHT 2005 ROBERT E. MCKENZIE

VISIT OUR HOME PAGE

03/03/2007

Page created by: [email protected]

application for taxpayer assistance

Documents