Many taxpayers, both businesses and individuals, are experiencing a decrease in income from business shutdowns and the resulting economic slowdown caused by the COVID-19 pandemic. Others are having difficulty obtaining documents and records needed for an IRS audit. In response, the IRS is taking several steps to provide relief to taxpayers. These new procedures will last through at least July 15th.
For taxpayers who currently have an installment agreement with the IRS, payments due between April 1 and July 15, 2020, are suspended. The taxpayers are not required to make any payments during this period, and the IRS will not default any installment agreements. However, taxpayers may choose to continue making payments to avoid additional interest accruing.
Field Collection Activities
The IRS announced a significant change to its field collection activities. From April 1 – July 15, The IRS will not initiate liens, levies, or other enforcement actions. Revenue Officers will still continue to work cases and attempt to collect delinquent taxes, but will do so without utilizing enforcement actions.
The IRS will be suspending any new certifications of delinquent debt to the State Department. When the IRS certifies a taxpayer’s delinquent debt to the State Department, it prevents that taxpayer from being able to obtain a new passport, and any existing passport could be revoked. Certifications that took place before April 1, 2020, will remain in place.
Generally, the IRS will not initiate any new audits through July 15. Previously started audits will continue; however, they will be conducted through correspondence rather than face-to-face meetings. The IRS is still expecting taxpayers to respond to any information requests during this time period, if possible. If taxpayers need additional time to gather information, Revenue Agents have been instructed to allow for that time.
Offers in Compromise
For taxpayers with pending OICs, the IRS will allow until at least July 15 to provide any additional requested information. No pending OICs will be closed during this period without the taxpayer’s consent. The IRS is suspending any payments that are due pursuant to an OIC from April 1 to July 15.
Take Advantage of this Time
Taxpayers with outstanding IRS issues should take advantage of this time to plan a strategy with a qualified representative. This includes filing any delinquent, as this is a prerequisite for entering into any kind of resolution involving past-due taxes.
If you have any questions about this new announcement by the IRS, or if you would like to discuss your situation with a member of Goldin Peiser & Peiser’s IRS Defense Services team, please call Naveid Jahansouz at 972-818-5300.
COVID-19 Resources and Planning Services
Need timely updates and helpful links to COVID-10 disaster relief programs? Visit GPP’s COVID-19 Business Assistance and Resource Center. To learn the best path forward for your business during this challenging time, our COVID-19 Business Advisory and Planning Services Group is ready to assist.
For immediate questions, email CARETEAM@GPPcpa.com
Note: This content is accurate as of the date published above and is subject to change. Please seek professional advice before acting on any matter contained in this article.