The IRS is required to provide a notice of rights to the taxpayer, however, this important information is typically written in a fashion that can easily go unnoticed by the average person and even a seasoned tax professional. Most people, even on important documents, can get into a bad habit of skim reading looking for a font that speaks of an important nature, that stands out from the rest of the document. The IRS, however, has a habit of their own, to use average font and writing styles that can be easily overlooked. This leaves the taxpayers unaware of their rights while allowing the IRS to fulfill their legal obligation to notify.
The IRS is required by law to provide these notices when the need arises but the law does not dictate how they must be written. Failure to understand the notice is fault of the taxpayer alone and unfortunately, many do not fully understand their rights and obligations. Before the IRS can assess additional taxes, penalties, or interest, they must first send a Statutory Notices of Deficiency to the individual or business who owe taxes to the government. This notice advises the receiver that they have 90 days to petition the Tax Court in regards to taxes owed and failure to respond can result in the loss of several rights and the taxpayer is responsible for the full amount of tax plus penalties and interest.
Once a tax debt is owed, where the taxpayer has not fulfilled their tax obligation, the IRS is able to place a tax levy. A tax levy allows the IRS to seize funds belonging to the taxpayer to repay the tax debt. Before a levy can be placed, however, the IRS must send a written notice for their right to a Collection Due Process Hearing, or a CDP Hearing. In this notice, the taxpayer is informed that they have the right to request this hearing and doing so can halt a levy while the hearing is ongoing.
These notices, along with hundreds of others, issued by the IRS are pages of fine print and misleading text font. Many of these notices look like mundane balance due notices that are automatically sent out, causing taxpayers to not read them thoroughly and lose their rights to hearings or to petition the tax court for leniency in their debt owed. It is hard to imagine that the intent of the IRS is anything but to deceive when in 1998, the U.S. Congress sanctioned that the IRS must provide clear and obvious legal notices to the taxpayers prior to taking action. Initially following this new requirement, the IRS issued statements with the purpose of the notice and the taxpayer’s rights written clearly in bold – whether in the header of the notice or obviously stated within the first page of the notice. Now, in more recent years, the bold as disappeared and the font size has gotten smaller. Some notices are several pages of legal jargon, with the intent of the notice hidden within the pages. After attempting to read the notice, many give up, believing it to be unimportant, when it is in fact rather important statement of rights and a statement of available steps for recourse.
We advised that taxpayers pay special attention to IRS notices, especially if they are sent as certified mail. You have the legal right to be heard and failure to exercise this right can be can have a devastating effect on your tax debt. Contact us if you are unsure of the intent of any notice and for assistance in getting through your tax debt.