The Internal Revenue Service’s new People First Initiative temporarily suspends many collections and enforcement activities to ease the burden on people facing tax issues during the health crisis.
The changes range from postponing certain payments related to installment agreements and Offers in Compromise to collection and limiting certain enforcement actions. The projected start date is April 1, and the effort will run through July 15. During this period, the IRS will avoid in-person contacts but will continue to take steps to protect all applicable statutes of limitations.
Highlights of the People First Initiative include:
Installment Agreements — Payments due on existing installment agreements between April 1 and July 15, 2020, are suspended. Taxpayers who are currently unable to comply with the terms of an installment payment may suspend payments. Interest will continue to accrue on unpaid balances. People unable to fully pay their federal taxes can enter into a new monthly payment agreement with the IRS online or over the phone.
Offers in Compromise (OIC)
- Pending OIC applications — The IRS will allow taxpayers until July 15 to provide requested additional information to support a pending OIC.
- OIC Payments — Taxpayers may suspend all payments on accepted OICs until July 15, 2020, although interest will continue to accrue on unpaid balances.
- Delinquent Return Filings — The IRS will not default an OIC for taxpayers who are delinquent in filing their tax return for tax year 2018. However, taxpayers should file any delinquent 2018 return (and their 2019 return) before July 15, 2020. New OIC submissions can still be submitted.
Field Collection Activities — Liens and levies (including any seizures of a personal residence) initiated by field revenue officers will be suspended during this period. However, field revenue officers will continue to pursue high-income non-filers and perform other similar activities where warranted. Automatic, systemic liens and levies also will be suspended.
Passport Certifications to the State Department — IRS will suspend new certifications to the Department of State for taxpayers who are “seriously delinquent.” Certification prevents taxpayers from receiving or renewing passports.
Private Debt Collection — The IRS will not forward new delinquent accounts to private collection agencies during this period.
Field, Office and Correspondence Audits — During this period, the IRS generally will not start new field, office and correspondence examinations. They will continue to work refund claims where possible, without in-person contact. The IRS encourages taxpayers to respond to IRS correspondence requesting additional information if possible.
- In-Person Meetings — In-person meetings regarding current field, office and correspondence examinations will be suspended, but IRS examiners will continue their examinations remotely, where possible.
- Unique Situations — Particularly for some corporate and business taxpayers, there may be instances where the taxpayers desire to begin an examination while people and records are available. When it’s in the best interest of both parties and personnel are available, the IRS may move forward with an examination.
Earned Income Tax Credit and Wage Verification Reviews — Taxpayers have until July 15, 2020, to respond to the IRS to verify that they qualify for the Earned Income Tax Credit or to verify their income. If unable to do so, taxpayers should reach out to the IRS, indicating the reason the information is not available. Until July 15, 2020, the IRS will not deny these credits for a failure to provide requested information.
Independent Office of Appeals — Appeals employees will continue to work their cases over the telephone or by videoconference. Taxpayers are encouraged to respond to requests for information promptly.
Statute of Limitations — The IRS will issue Notices of Deficiency and pursue other similar actions to protect the interests of the government in preserving all applicable statutes of limitation. Where a statutory period is not set to expire during 2020, the IRS is unlikely to pursue actions until at least July 15, 2020.
For more information, visit www.irs.gov.