Tuesday, July 17, 2012

IRS Seizures Score a C+ (78%) on Proper Procedure

  • Tax Prof Review of TIGTA Study of IRS Seizures

  • TIGTA Report on IRS Seizures

  • The Treasury Inspector General of Tax Administration studied 50 seizures of taxpayer property by the IRS to see if the seizures complied with the IRS Restructing and Reform Act of 1998 (popularly known as the Taxpayer Bill of Rights) and IRC Sections 6330 through 6344.  No actual harm to taxpayers occurred.  However, on 11 of 50 seizures, IRS made one or more errors which had the potential to hurt the taxpayer.  Particular errors including incorrect information on either tax liability or proceeds from sale after seizure; incorrectly application of sale after seizure proceeds against tax liability and incorrect details on the sale of seized property.

    In one sense, the apparent lack of actual harm to taxpayer makes this report "much ado about nothing."  It is not that hard to see in other circumstances; however, that such errors could have done real damage.  It should be noted that the IRS consented to the findings of the study and made assurances of improving procedures.


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