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IRS Ends Unannounced Visits to Taxpayers' Homes or Businesses
IRS Changes Policy to Improve Safety and Reduce Confusion
The IRS has made a significant policy change by ending its practice of unannounced visits to homes or businesses from agency revenue officers for most taxpayers. This change is part of a broader IRS overhaul aimed at improving safety and reducing public confusion. According to IRS Commissioner Danny Werfel, this new policy reverses a long-standing practice by revenue officers that dates back decades. Previously, revenue officers would visit individuals and businesses unannounced to collect substantial tax debt, but now they will make initial contact via a mailed letter to schedule in-person meetings.
Safety Concerns Prompted the Policy Change
The decision to eliminate unannounced visits was made due to safety concerns expressed by both IRS employees and taxpayers. Commissioner Werfel explained that knocking on someone's door today is different than it was years ago, and there have been reports of IRS employees feeling unsafe. The agency believes that initial contact through a mailed letter will be a less stressful and safer way to communicate with taxpayers.
Exceptions to the New Policy
While the majority of taxpayers will no longer experience unannounced visits from IRS revenue officers, there are still certain situations in which these visits may occur. These include summonses and subpoenas, as well as the seizure of assets. However, these activities are limited compared to the number of visits that took place under the old policy. It is estimated that there will only be a few hundred of these types of visits each year, compared to the tens of thousands of unannounced visits in previous years.
Support for the Policy Change
The National Treasury Employees Union, which represents IRS workers, supports the new policy. The union's president, Tony Reardon, stated that recent hostile rhetoric and false claims about IRS employees have made their work more dangerous. The union believes that revenue officers can continue to fulfill their mission of helping taxpayers meet their tax obligations through other means of communication. Despite this support, some Republicans have expressed concerns about the new policy and have called for the funding of the IRS to be reduced.
Conclusion: How the End of Unannounced IRS Visits May Impact New Businesses
The announcement by the IRS to end unannounced visits to taxpayers' homes or businesses comes with potential implications for new businesses. While the change is primarily aimed at improving safety and reducing confusion, there are considerations to be made regarding its impact on entrepreneurs and startups.
On the positive side, the new policy brings a sense of relief for business owners, especially those who often feel overwhelmed by sudden encounters with revenue officers. By initiating contact through a mailed letter and scheduling in-person meetings, the IRS allows businesses to better prepare for discussions on tax debt and obligations, ensuring they have the necessary information at hand.
Moreover, the elimination of unannounced visits may reduce the level of stress and anxiety associated with unexpected encounters. Since starting a new business is already a demanding endeavor, minimizing the uncertainty surrounding IRS interactions can help owners maintain focus and productivity.
However, the exceptions to the new policy raise some concerns. Summonses, subpoenas, and asset seizures remain situations where unannounced visits may occur, albeit on a limited scale. As a result, new businesses still need to be prepared for potential unannounced visits in these specific scenarios.
It is also important to note that the policy change has received support from the National Treasury Employees Union, citing increased safety concerns for IRS employees as a driving factor. This support indicates a commitment from the IRS to protect their personnel and improve overall working conditions.
In light of these developments, new business owners should familiarize themselves with the new IRS policy and its implications. Staying informed about their tax obligations, promptly addressing any correspondence from the IRS, and seeking professional guidance when needed can help navigate the evolving landscape of tax compliance and avoid any potential pitfalls.
Article First Published at: https://www.cnbc.com/2023/07/24/irs-halts-most-unannounced-visits-to-taxpayers-from-revenue-officers.html