Recently several lawmakers have introduced legislation in the House of Representatives (HR 2171) that would significantly limit the IRS ability to go after taxpayers that owe back taxes to the IRS. Specifically the bill is called the “Taxpayer Protection Act of 2017” and its purpose is to reduce taxpayer burden and enhance taxpayer protections.
The key provisions are as follows;
1) Repeal of the private debt collection program, … in 2015 the IRS was ordered by Congress to turnover uncollectible or inactive accounts to one of four third party collection agencies. This program started up in April 2017. This bill would repeal that order due to fears that collectors would act abusively or scammers would call and threaten taxpayers.
2) Impose Limitations on Levies on Retirement Accounts – Currently the IRS is allowed to levy IRA’s or 401k type accounts to collect back taxes. This bill would essentially nix that and only allow the IRS to levy in cases whereby the taxpayer had acted flagrantly to avoid taxes or committed fraud.
3) Repeal of the downpayment requirement for Offers in Compromise – Currently the IRS rules requires a 20% non-refundable down payment to accompany an Offer Submission. This bill would repeal that requirement entirely.
If you have any questions on how this may affect you now or in the future please feel free to give my office a call or contact us on our website.