The IRS announced its “People First Initiative” on March 25. The program involves a slate of temporary changes designed to ease the burden on taxpayers during this difficult time. The IRS is now temporarily suspending installment agreement and offer in compromise payments as well as postponing collection and enforcement activities. Please find further details below on the temporary changes that will give the most significant relief to taxpayers. These changes will remain in effect until July 15, 2020.
Please contact us if you have any questions or concerns about the “People First Initiative” and its effect on your situation.
Existing Installment Agreements:
We previously indicated that, “For taxpayers currently in an installment agreement, monthly payments due between April 1, 2020 and July 15, 2020 are suspended. This means the IRS will not cancel or default any installment agreement during this period for any missed payments.”
We have an important update:
The IRS will not automatically suspend payments. Taxpayers will have to voluntarily stop making their monthly payments. If the taxpayer is a direct-debit installment agreement where the IRS takes the payment from their bank account, this creates a significant issue because most of the IRS phone lines are closed so it is difficult to request that the IRS stop taking these payments from a taxpayer’s bank account. Taxpayers will need to contact their bank to stop payment or remove the funds from their bank account on the day of the scheduled debit.
Offer in Compromise (OIC):
OIC Payments: Taxpayers with an accepted Offer in Compromise can delay all payments until July 15, 2020.
Pending OIC Applications: The IRS has also extended the deadline for taxpayers to supply any requested OIC documentation to July 15, 2020. Furthermore, the IRS will not close any pending OIC applications without the taxpayer’s consent during this time frame.
Delinquent Return Filings: Taxpayers now have until July 15, 2020 to file any delinquent 2018 tax returns to prevent their OICs from being in default.
Liens and Levies:
The issuance of any new federal tax liens and levies is suspended until July 15, 2020. This suspension also applies to cases involving IRS Revenue Officers. This means taxpayers are not at risk of any enforcement action during this time.
Passport Certifications to the State Department:
The IRS will suspend new passport certifications to the State Department until July 15, 2020. IRS passport certifications prevent taxpayers from receiving a passport or renewing a current passport.
Have Questions? Call the Experienced Tax Attorneys at Wiggam & Geer
We are here to answer any questions or concerns you might have regarding these new IRS updates.
Contact the experienced financial attorneys at Wiggam & Geer at 404-609-1300 or online for all your individual and business tax questions.