6 Things To Know When Dealing With IRS Revenue Officers
As described in our recent article, How IRS Tax Collections Work, if you are delinquent on taxes and do not respond to collection notices, the IRS will turn your account over for collection either to the Automated Collection System (ACS) or an IRS revenue officer. The ACS handles most cases, so if your case has been turned over to a revenue officer, it is likely because
- You owe more than $100,000, OR
- ACS has been unsuccessful in collecting your debt, and it is worth it to the IRS to pay a revenue officer to collect your delinquent taxes.
If the IRS has assigned a revenue officer to your case, they are not messing around. The IRS highly trains Revenue officers, and they have much more authority than the ACS, which puts you at a disadvantage. With so much at risk, it’s time to contact an experienced tax professional.
1. Authority of an IRS Revenue Officer
IRS revenue officers can levy your wages and your bank accounts as can the ACS. Revenue officers may
- Subpoena documents
- File court orders to obtain search warrants
- Levy accounts receivable
- File lawsuits to seize your home, and personal and business assets
- Check your credit to help determine your ability to pay delinquent taxes
A revenue officer cannot arrest you, but in cases of tax fraud or other suspected illegal actions, they may refer your matter to the IRS Criminal Investigations Division (CID).
2. Difference Between a Revenue Officer and Revenue Agent
Many people are understandably confused about the difference between an IRS revenue officer and an IRS revenue agent. They do not play the same roles. A revenue agent audits taxpayers. They may find you owe more than you initially claimed, but they will not be the person who takes action to collect. A revenue officer collects your debt. They interview taxpayers and third parties, negotiate with taxpayers for payment and take legal steps to collect your delinquent taxes.
3. Visits from Your IRS Revenue Officer
The revenue officer assigned to you will work out of a nearby IRS field office, and for their first contact, a revenue officer is required to visit you in person. Should they leave a card in your door or another indication they tried to visit you while you were out, it would be a mistake to ignore it. It’s essential that you get off on the right foot with your revenue officer. Your revenue officer may stop in on you unexpectedly at any time during the collection process.
Your first visit by a revenue officer should not come as a total shock, because you would have already received IRS notices demanding payment. In many cases, you would also have received phone calls from the ACS. However, if you have doubts that the person at your door is a revenue officer, you have the right to ask for their identification. They carry a pocket commission, which is a plastic ID badge, and an HSPD-12 card. Each should feature a photo of the revenue officer and have a serial number.
4. Working with a Revenue Officer to Your Advantage
A good revenue officer is expected to finish as many cases as possible and move onto others. It is not to their advantage to spend years trying to get every dime out of you if it’s unlikely you can pay. Although it would be far better to set up a payment agreement with the IRS long before the IRS assigns a revenue officer to you, you can work with them to set up an installment agreement, submit an offer in compromise or pursue other options.
You do not want to annoy your revenue office, so be honest and do not try to hide your assets or incur a lot of new liabilities while you are dealing with them. Be cooperative, but do not be afraid to make your case, and do not let yourself get pushed into anything without consulting a tax professional and considering all the ramifications.
You have no control at all over who the IRS assigns as your revenue officer, and like people in any profession, some are easier with which to work than others. If you feel that your revenue officer is unfair, you could speak with their Group Manager (GM), but it’s not likely the GM will take your side. If you do not get anywhere with the GM, you could go above even the GM’s head to their boss, the Territory Manager. But unless you can make an airtight case the revenue officer acted incorrectly, this may cause more harm than good.
Be aware that if you get an authorized tax representative, not only can they advise you, but they can deal with your revenue officer, so you do not have to do so. A professional understands what is essential and can often negotiate a better agreement than you could on your own.
5. Requesting a CDP Hearing
If it seems you are getting nowhere with your revenue officer, rather than go to their superiors, it may be a wiser course to wait until you receive a notice proposing a levy, a Notice of Levy, or a Notice of Federal Tax Lien and then file a Request for a Collection Due Process (CDP) hearing. It will enable you or your representative to negotiate with a settlement officer where you may make better progress than with a revenue officer. It will also stop your revenue officer’s collection actions while you appeal.
6. What to Do if A Revenue Officer Contacts You
You may want to consult with a tax professional long before a revenue officer contacts you. Once this happens, you would be very wise to get professional representation. The worst thing you can do is to ignore the revenue officer because they will move forward to collect from you no matter what. An experienced tax professional can help you to determine your best options and to negotiate with the revenue officer. Getting good representation can give back some control and can save you a great deal of money.