The IRS Chief Counsel's Office has issued Program Manager Technical Advice 2022-006, that answers employee questions about collecting on a delinquent taxpayer's assets that are outside the U.S.
The Advice addresses, in a question-and-answer format, when it's appropriate for the IRS to simultaneously pursue certain collection actions against a taxpayer that has been issued a tax bill, but has refused or neglected to pay it, and the IRS has exhausted domestic assets to levy.
According to the Advice, the IRS generally isn't prohibited from pursuing multiple collection actions simultaneously. However, two specific collection actions that shouldn't be taken simultaneously: 1) issuing the taxpayer a notice of intent to request passport revocation (Letter 6152), and 2) actually referring the taxpayer to the State Department for revocation. The letter must be issued first and the time for responding to the letter must expire before the State Department referral.
Also, once a taxpayer's debt has been referred for litigation, no collection actions should be taken without approval from the Chief Counsel's Office and/or the Justice Department, the Advice noted.
In addition, the Advice explained the appropriate use of databases set up under the Foreign Account Tax Compliance Act (FATCA) when trying to identify offshore assets that can be used for collection. Generally, FATCA databases may be used to identify assets for collection, the Advice noted.
However, the authorized uses of some FATCA data sets may vary depending on whether the data was received under an international tax information sharing agreement. A few international agreements restrict the use of tax information for tax periods that predate the effective date of the agreement or require the IRS to obtain authorization before publicly disclosing shared information in a collection proceeding.
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