Knowing your rights as a taxpayer is important especially when you have to deal with an IRS agent without any professional help. This can happen if you’re on a tight budget and cannot afford to pay a Lawyer or an Accountant as your representative. You will more likely feel intimidated when meeting with the IRS if you are unaware of your rights under our tax code. This is the reason why the Taxpayer’s Bill of Rights was created in 2014 that states the rights and privileges of taxpayers when dealing with the IRS. The bill ensures protection for people if ever the IRS tries to abuse their power.
Here are the 10 provisions of the Taxpayer’s Bill Of Rights that you should know about:
The right to be informed. Taxpayers have the right to clear explanations with regards to the tax laws and to be informed about the IRS decisions about their tax accounts and it has to be fully and clearly explained. All the IRS procedures in IRS publications and correspondings has to be clearly explained to the taxpayer as stated under the bill. A taxpayer whose return is being audited and found to owe additional tax, for example, has to receive a clear written explanation of the situation, how much they owe, why is it owed, and it is due. An IRS decision that is deemed incorrect by the taxpayer can be contested as well.
The right to quality service. A taxpayer has the right to promptly and courteously communicate with the IRS, and vice versa. If the service offered by the IRS comes off as offensive or incomplete, you have the right to speak to a supervisor and file a complaint until the issues are resolved. The whole process should also be in a quick, clear, and understandable manner. Speaking over the phone with the IRS may take a long wait but you must be provided an expedited service as soon as you are able to speak to someone.
The right to pay no more than the correct amount of tax. As a taxpayer, you are only required to pay the tax owed and the applicable interest and penalties. An incorrect amount is against your taxpayer rights. The tax payment once received for the correct tax year has to be stated in your account correctly.
The right to challenge the IRS’s position and be heard. Do not be afraid to object to the decision of the IRS if you have the proper documentation supporting your claim. Your objections shall be looked into by the IRS in a fair and prompt manner. It is required for them to respond to your claim of disagreement under the taxpayer’s rights bill.
The right to appeal an IRS decision in an independent forum. You have the right to appeal to almost all decisions made by the IRS by going to the Office of Appeals. In the said office, you shall be provided a representative to review your case and possibly undo the decision made about the issue. Once the Office of Appeals has reached a decision, you shall receive a clear written response to the decision. In some cases, taxpayers can take their cases to the court if the Office of Appeals cannot resolve the problem or if it agrees with the IRS’s decision.
The right to finality. The IRS is required to inform the taxpayers of the deadlines for challenging IRS positions, collect a tax debt, and the maximum amount of time for them to audit a certain tax year. You also have the right to informed once the IRS finishes an audit.
The right to privacy. Even if the IRS conducts their inquiries, examinations, or enforcement actions, you still the right to privacy. Their process should not be intrusive especially if it's not really necessary. They are expected to obey all applicable laws and respect rights of due process.
The right to confidentiality. As a taxpayer, you can expect that the IRS will treat your information as strictly confidential. Your right states that no information should be disclosed to another party unless mandated by the taxpayer or by law. An IRS agent or tax preparer breaching this rule will be subject to punishment.
The right to retain representation. If you want a representative to act on your behalf when dealing with the IRS, you have the right to do so. Those who do not have the finances to do this can ask the assistance of the Low Income Taxpayer Clinic.
The right to a fair and just tax system. If you’re a taxpayer whose circumstances affect your tax liabilities, ability to pay, or the ability to provide the information requested, the IRS shall consider your situation and have the right to ask the financial assistance of the Taxpayer Advocate Service or for unresolved issues that weren't resolved through normal channels.
