In a significant policy shift, the U.S. Internal Revenue Service (IRS) has announced the immediate cessation of its long-standing practice of unannounced taxpayer visits by agency revenue officers. The decision cited by Reuters, aimed at reducing public confusion and enhancing overall safety measures for both taxpayers and IRS employees, marks a major step in the ongoing efforts to reform IRS operations.
The policy change comes on the heels of the passage of the Inflation Reduction Act and the establishment of a new IRS strategic operating plan in April, signaling a broader overhaul of the agency’s practices. IRS Commissioner Danny Werfel, who made the announcement, emphasised that the alteration would foster increased confidence in the tax administration process, describing it as a ‘common-sense step.’
IRS rings the doorbell of change
Under the previous procedure, revenue officers would visit homes and businesses without prior notice to recover significant tax debts, often amounting to a median unpaid balance of $110,000. However, such unannounced visits have been the subject of mounting security concerns and anxiety among taxpayers, especially in the face of false and inflammatory rhetoric surrounding the IRS and its workforce.
Commissioner Werfel pointed out that advancements in technology and the availability of alternative means of communication have rendered unannounced visits unnecessary and even risky for both parties involved. Instead, revenue officers will now initiate contact through mailed appointment letters, known as 725-B, to schedule in-person meetings with taxpayers in most cases.
The National Treasury Employees Union (NTEU), representing IRS workers and employees in various federal agencies, has supported the policy change. CNBC cited NTEU’s national president, Tony Reardon, who highlighted the mounting danger faced by IRS officers in recent years, partly due to hostile rhetoric and unfounded claims directed at the agency’s employees. The NTEU believes that the transition to scheduled meetings will protect IRS officers and allow them to carry out their mission of helping taxpayers fulfill their lawful tax obligations effectively.
Unannounced visits restricted to special cases
The new policy, however, does not entirely eliminate unannounced visits. The IRS clarified that extremely limited circumstances, such as the service of summonses and subpoenas or sensitive enforcement activities involving asset seizures, may still warrant such visits. However, these occurrences are expected to be minimal, numbering only a few hundred annually. In contrast, under the previous policy, tens of thousands of unannounced visits occurred annually.
By ending the routine practice of unannounced visits, the IRS aims to streamline its operations and allocate resources more efficiently. The additional funding provided by the Inflation Reduction Act will enable the agency to bolster staffing for compliance work, ensuring that revenue collection can be effectively carried out without resorting to stressful and potentially unsafe visits.
(With inputs from Agencies)
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