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>>>This message is brought to you by the
Taxpayer Advocate Service. Your voice at the IRS.
>>>Nina Olson: Hello. I'm Nina Olson,
the National Taxpayer Advocate,
with some news you can use. The Internal Revenue
Code requires me to submit an Annual Report to
Congress each year, identifying at least 20 of
the most serious problems facing taxpayers and to
make administrative and legislative
recommendations to resolve those problems. Overall,
this year's report identifies 21 problems and
provides updates on two previously identified
issues. The report recommends dozens of
administrative changes, proposes 11 legislative
changes, and analyzes the 10 tax issues most
frequently litigated in the federal courts. This
year I identified the IRS's lien filing policies
as the second most serious problem facing taxpayers.
The IRS can file a notice of federal tax lien with a
local government recording or register's office when
a taxpayer owes a tax debt. A federal tax lien
can be an effective tool in tax collection,
because it puts the world on notice that there is an
IRS debt that has priority of payment over other
debts. An IRS notice of federal tax lien reaches
all property the taxpayer owns at the time of lien
filing, and all property acquired after the lien is
filed, up until the tax debt expires or is
otherwise resolved. The filing of a tax lien can
significantly affect a taxpayer's credit and
ability to get financing, find or retain a job,
secure affordable housing or insurance,
and ultimately pay the tax bill. Even when the lien
is paid in full, it remains on the taxpayer's
credit report for seven more years. And when the
tax lien expires because the debt is too old,
information about the lien remains on the taxpayer's
credit report for anywhere from ten years to
indefinitely. Because an imprudently filed tax lien
can not only undermine long-term tax collection,
but also harm the taxpayer's financial
viability, I believe the decision whether to impose
a tax lien should be made on a case-by-case basis.
Under the current system, however,
the IRS files many liens systemically,
with rules that require automatic lien filing
without meaningful human review. I recommended that
the IRS change its lien filing policies,
and that Congress require the IRS,
before imposing a lien, to determine that the
benefits of filing the lien outweigh the harm to
the taxpayer and that the filing will not jeopardize
the taxpayer's ability to comply with future tax
obligations. My report also recommends changes to
provisions of the Fair Credit Reporting Act that
govern the reporting of tax debts on credit
reports. What can you do if the IRS files a lien
against you? First, if you can show the lien is
impairing your ability to pay your current tax
obligations, or is preventing you from
getting a job, or obtaining financing for
your business, you can ask the IRS to withdraw the
notice of federal tax lien. Your request will be
strengthened if you can enter into an installment
agreement with the IRS to pay the taxes. Second,
even if you pay off the tax debt entirely and the
IRS releases the lien, you may still need to ask for
a lien withdrawal, because the credit reporting
agencies will still show the lien on their reports
for seven years after the release. And where the
lien expires because the tax debt is unenforceable
because of age, the lien will sit on the credit
reports even indefinitely. So if you can show that
the credit report information is damaging
your financial ability to be compliant with your
current and future tax obligations,
you should ask for a lien withdrawal. But the best
advice, if you have a tax problem,
is to be proactive. If you are behind on your tax
payments, call the IRS. Try to work out a payment
plan. And if the IRS -- if paying the IRS means you
can't pay your basic living expenses,
then tell the IRS. In such cases,
it can put you in currently not collectable
status. If the IRS proposes to file a notice
of federal tax lien, explain how that action
will harm you. Ask to speak to a manager. But
most importantly, don't give up and don't ignore
IRS notices, because the IRS won't go away. And of
course, if you have an ongoing problem or if
something the IRS is doing will cause you immediate
or long-term financial harm,
you can call the Taxpayer Advocate Service. The
Taxpayer Advocate Service is independent within the
IRS, so our people know the system and can help
you navigate it. We will listen to your problem,
help you understand what needs to be done to
resolve it, and stay with you every step of the way
until the problem is resolved. We have at least
one local taxpayer advocate in each state,
the District of Columbia, and Puerto Rico. You can
call your local advocate, whose number is in your
phone book, or call our toll-free line,
at 1-877-ASK TAS1 -- A-S-K T-A-S 1. You can also
visit our tax toolkit website,
at www.taxtoolkit.IRS.gov, which also links to our
Facebook and Twitter pages. I hope you've found
this presentation informative and useful.
Please visit our website at IRS.gov/advocate for
additional information on the Annual Report to
Congress and the Taxpayer Advocate Service.
Thank you and remember, the Taxpayer
Advocate Service is your voice at the IRS.