Making Voluntary Payments to the IRS

For those who owe the IRS back taxes, the decision as to how to pay the IRS raises a number of concerns.  One such concern for those who owe taxes for several different tax years or several different types of taxes, is what year and tax account the payments are applied to.  Typically taxpayers get…

IRS Can Avoid Bankruptcy Collection Hold

One of the benefits of filing bankruptcy is that creditors are precluded from taking collection actions.  When a taxpayer who owes unpaid taxes to the IRS files bankruptcy, this collection hold applies to the IRS.  But what if the IRS could simply file a motion and avoid the collection hold?  This is exactly what happened…

Can the IRS Foreclose on an Inheritance that is Jointly Owned?

What happens when someone inherits money from their parents, but they also owe the IRS? Can the IRS collect on the inherited assets? What if the taxpayer only inherited a fractional interest in the property? Can the IRS foreclose on the property to pay the back taxes? The court considered this in United States v.…

Taxpayer Not Entitled to In-Person Tax Collection Hearing

Dealing with unpaid taxes and the IRS bureaucracy can be challenging. Sometimes the key is to get in front of the right person at the IRS. But the IRS often refuses in-person meetings. The Roberts v. Commissioner, T.C. Memo. 2019-117, case provides an example of this. It involves the taxpayers request for an in-person collection…

Setting Off a Non-Tax Debt Owed by the IRS

If you owe back taxes but the Federal government owes you for some other matter, can the IRS offset the unpaid taxes with the amount the government owes you? The answer is more complex than one would think. The court addresses this in Tartt v. Commissioner, T.C. Memo. 2019-112. Facts & Procedural History The taxpayer…

What is a Genuine Opportunity to Dispute a Tax Liability?

Taxpayers are able to dispute a tax liability before the IRS can take certain collection actions. But what if the IRS does not afford the taxpayer with a genuine opportunity to dispute the liability as required by law? The court addresses this in Dood v. Commissioner, T.C. Memo. 2019-107. Facts & Procedural History The taxpayer…

IRS Tax Debts from Retirement Account Distributions

Retirement account distributions typically trigger sizable tax liabilities. These liabilities often go unpaid, which results in unpaid tax debts and IRS collection enforcement actions. With careful planning, sometimes these taxes can be avoided. Tax on Retirement Account Distributions Most distributions from retirement accounts trigger income taxes. This includes distributions from IRAs and 401(k)s. The idea…

Can the IRS Take My 401(k) Plan Account?

Can the IRS take my 401(k) plan account for unpaid taxes? Does it have to wait until I take distributions from the 401(k) plan account? The IRS recently asked its tax attorneys this question in CCA 201927019. About 401(k) Plan Accounts The 401(k) plan account is the most popular method for saving for retirement. They…