The collection process is a sequence of actions that the IRS can adopt to collect on taxes you owe, if you don’t willingly pay them. The collection process will commence if you don’t make your payments in full and on time.
If you come across an IRS collection action, such as a tax lien, levy, or IRS denial of your request for an installment agreement, you can request for Collection Appeals that corresponds to your case.
During the trial, you or your official agent will state your case and provide credentials to support your situation. It’s, in general, a fast process, but you can’t plea for the outcome in court if you oppose it.
The reason it is so important to file a collection appeal is because of the way your case will get expedited to be resolved. Once the collection appeal has been filed all collection activity will be placed on hold. IRS agents that work appeals are more experienced and are generally willing to get case settled in a timelier manner than those in collections or examination.
History Of An IRS Collection Appeal
“HOW IT INVOKED?”
Before 1998, taxpayers who had unpaid IRS money were at the kindness of the IRS Collections Division. There was no place for appeals, audit reconsiderations, and United States Tax Court rights.
The Collection Division used to simply confiscate property/assets whenever it deemed it administratively efficient to expedite payment. In 1998 Congress held hearings and considered the IRS collection methods cruel.
As a result of hearings, certain Collection Appeal Rights invoked. Besides this, every taxpayer was advised to file a collection appeal before the collection action took place.
Appeal a Collection Decision
Before appealing a collection decision, you should select the appeal procedure listed below that associates best to your case:
The Collection Appeals Program (CAP) can be taken for a broad array of collection actions. You may undergo the CAP method if you are involved in any of the following collection actions:
- Rejection of Installment Agreement
- End of Installment Agreement
- Alteration of Installment Agreement
Benefits Of CAP:
When a taxpayer invokes their CAP rights several good things happen:
- It allows the taxpayer to plea a collection action before or after assured IRS actions.
- The taxpayer can also use CAP for issues related to installment agreements.
It is one of the best opportunities for taxpayers to resolve tax controversies with the IRS short of tax litigation.
Benefits Of CDP:
When a taxpayer invokes their CDP rights several good things can happen:
- Collection activity stops
- The case is redirected to an Appeals Officer to re-examine.
- The taxpayer keeps the right to take their case to the United States Tax Court.
- Bankruptcy timing rules for a tax release.
Must be filed within 30 days from the date on a Notice of Federal Tax Lien (NFTL) or a final notice of threat to levy assets (letter 11). You can file the appeal with the IRS Form 12153, Request for Collection Due Process Hearing or Equivalent Hearing.
Even after these benefits, unfortunately, many taxpayers don’t understand the importance of filing an appeal. As per a research from The National Taxpayer Advocate, just 3% of taxpayers ever take benefit of their appeal privileges!
Taxpayers should understand the value of their collection appeals and make the best use of it.
If you have any questions regarding your collection appeal rights, then contact EA Tax instantly to get answers to all your questions. We are a renowned Tax Resolution company that provides comprehensive solutions for all your tax debt problems!