RS Commissioner Douglas Shulman has announced 1000 open houses at various venues across the country to allow distressed taxpayers to meet IRS officials and get a potential resolution to their tax troubles. The list of the venues and time of these open houses is given on the IRS website.
Last year also, IRS reached out to individuals and small businesses to help them out of their tax troubles. The front line IRS personnel were authorized to relax tax liabilities on people in distress. A number of collection efforts were stopped and several taxpayers got their monthly installments reduced or were allowed to forego a payment or two.
This year too people can walk into these open houses with there particular cases and sit with an IRS personnel to seek relief from their due taxes. IRS wants people come out openly and get settlement on their tax problems. The open houses will have IRS personnel from all departments including appeals, examinations and collections.
These efforts by IRS will help a number of people who have recently been unemployed, had their businesses shut down or are in any other kind of financial distress. These open houses will also allow IRS to better assess the tax collection estimates this year.
The ‘offer in compromise’ (OIC) offered by IRS will see a higher limit on income, which means more people can get benefit from the relaxation in taxation dues this year. The increase in income limit will see thousands of taxpayers get OIC. Under OIC, an agreement is reached between the taxpayer and the IRS on reduced tax collection for the particular year. A number of factors like the individual’s current and previous income, and potential for future income are taken into consideration while deciding on the reduction allowed in the dues.
However, IRS may roll back on OIC terms in case the economic situation of an individual improves during the year. The person may be required to sign a future income collateral agreement under which if he or she earns more than what had been estimated at the time of tax reduction agreement, the OIC would be reconsidered.
IRS’ announcement is likely to help thousands of people with tax troubles and if you happen to be one of them, don’t shy away from attending the open houses and see how you could benefit from the IRS initiative. On the other hand, this will allow IRS to make sure that they are able to collect taxes realistically, without putting distressed people through additional trouble.
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