WASHINGTON
— The Internal Revenue Service today announced several additional steps it
is taking this tax season to help people having difficulties meeting their tax
obligations because of unemployment or other financial problems.
The
steps –– an expansion of efforts that began more than a year ago ––
include additional flexibility on offers in compromise for struggling taxpayers,
a series of Saturday “open houses” offering taxpayers extra opportunities
to work out tax problems face to face with the IRS, special outreach with partner
groups to unemployed taxpayers and the availability of more information on a special
section of the IRS Web site.
“Times are
tough for many people, and the IRS wants to do everything it can to help people
who have lost their job or face financial strain,” IRS Commissioner Doug
Shulman said. “We continue to make adjustments to key programs and expand
ways for people to get help. We’re doing everything we can to help ease the
burden on struggling taxpayers.”
New
Flexibility for Offers in Compromise
For
some taxpayers, an offer in compromise –– an agreement between a taxpayer
and the IRS that settles the taxpayer’s debt for less than the full amount
owed –– continues to be a viable option. IRS employees will now have
additional flexibility when considering offers in compromise from taxpayers facing
economic troubles, including the recently unemployed.
Specifically,
IRS employees will be permitted to consider a taxpayer’s current income and
potential for future income when negotiating an offer in compromise. Normally,
the standard practice is to judge an offer amount on a taxpayer’s earnings
in prior years. This new step provides greater flexibility when considering offers
in compromise from the unemployed. The IRS may also require that a taxpayer entering
into such an offer in compromise agree to pay more if the taxpayer’s financial
situation improves significantly.
These immediate
steps are part of an on-going effort by the IRS to ensure the availability of
the Offer in Compromise program for taxpayers.
Hundreds
of Saturday Open Houses to Resolve Taxpayer Issues
In
addition, IRS will hold hundreds of special Saturday open houses to give struggling
taxpayers more opportunity to work directly with IRS employees to resolve issues.
The offices will be open on March 27 and three additional Saturdays in the spring
and early summer. Dates, times and locations will be announced shortly.
During
the expanded Saturday hours, taxpayers will be able to address economic hardship
issues they may be facing or get help claiming any of the special tax breaks in
last year’s American Recovery and Reinvestment Act, including the:
- Homebuyer
tax credit
- American Opportunity Credit
- Making Work Pay
credit
- Expanded Earned Income Tax Credit
In
addition to these special Saturdays, taxpayers can take advantage of toll-free
telephone assistance and regularly scheduled hours at local Taxpayer Assistance
Centers. Taxpayers can find the location, telephone number and business hours
of the nearest assistance center by visiting the Contact My Local Office page
on IRS.gov.
Special Outreach Efforts to
Unemployed
The IRS is working and coordinating
with state departments of revenue and state workforce agencies to help taxpayers
who are having problems meeting their tax liabilities because of unemployment
or other financial problems.
These coordinated
efforts may include opportunities for taxpayers to make payment arrangements and
resolve both federal and state tax issues in one place.
Special
Section of IRS.gov Created
Taxpayers who
are unemployed or struggling financially can find information on a
new page on the IRS Web site, IRS.gov. This online tax center has numerous
resources including links to information on tax assistance and relief to help
struggling taxpayers.
Other Options Available
for Taxpayers
The IRS will continue to
offer other help to taxpayers, including:
- Assistance of the Taxpayer
Advocate Service for those taxpayers experiencing particular hardship navigating
the IRS.
- Postponement of collection actions in certain hardship
cases.
- Added flexibility for missed payments on installment agreements
and offers in compromise for previously compliant individuals having difficulty
paying.
- Additional review of home values for offers in compromise
in cases where real-estate valuations may not be accurate.
- Accelerated
levy releases for taxpayers facing economic hardship.
In
addition, the IRS will accelerate lien relief for homeowners if a taxpayer cannot
refinance or sell a home because of a tax lien. As previously announced, a taxpayer
seeking to refinance or sell a home may request the IRS make a tax lien secondary
to the lien by the lending institution that is refinancing or restructuring a
loan. The taxpayer may also request the IRS discharge its claim if the home is
being sold for less than the amount of the mortgage lien under certain circumstances.
