Construction Industry Conference - Virtual-Article - Taxpayers' Rights and the IRM Pt 1

Article - Taxpayers' Rights and the IRM Pt 1

Pdf Summary

This first installment of a two-part series explains how practitioners can use the Internal Revenue Manual (IRM) to protect taxpayers’ rights during IRS collection proceedings. The authors recommend knowing relevant IRM provisions, reading notices carefully, meeting strict deadlines, documenting communications, and sending appeals by certified mail or approved private delivery service.<br /><br />Taxpayers may use the Collection Appeals Program (CAP), generally by filing Form 9423, to challenge collection actions, including proposed liens, levies, or installment-agreement (IA) changes. Practitioners should request CAP rights before a federal tax lien is filed, discuss the matter with the collection manager when required, and ensure the IRS clearly explains appeal rights. Taxpayers may also request access to records and case workpapers during open cases.<br /><br />The article reviews IA rules. An agreement may include an anticipated current-year tax liability, and a qualifying IA request should identify the taxpayer and debts, propose a specific payment, and meet filing requirements. While a qualifying IA request is pending—or an IA is in effect or an appeal is unresolved—levies are generally restricted. Certain timely filers may receive a reduced failure-to-pay penalty. The IRM also provides six-year and one-year rules for evaluating expenses and payment capacity.<br /><br />If an IA defaults, the IRS generally must notify the taxpayer and allow 30 days to comply before termination. Practitioners should promptly cure missed payments or new liabilities and may appeal the default. Expense standards are guidelines, and documented deviations may be allowed when needed for basic living costs.<br /><br />Finally, revenue officers must respond promptly, explain appeal rights, and follow procedures for contacting taxpayers. The authors urge practitioners to challenge premature or procedurally improper collection actions and to use the IRM as a practical tool for ensuring consistent treatment.

Keywords

Internal Revenue Manual

taxpayer rights

IRS collection proceedings

Collection Appeals Program

Form 9423

installment agreement

tax liens

tax levies

certified mail

appeal rights