Taxpayer Advocate Report Has Items of Interest to Tax Resisters

Some highlights from the just-released National Taxpayer Advocate’s Report to Congress that may be of interest to tax resisters:

IRS Policy Statement 5-34 provides that, “Collection enforced through seizure and sale of the assets occurs only after thorough consideration of all factors and of alternative collection methods” and that “the official responsible for making the decision to seize must be satisfied that other efforts have been made to collect the delinquent taxes without seizing.… Seizure action is usually the last option in the collection process.” Yet, TAS is now seeing in its cases an inclination toward seizure despite the existence of viable alternative collection methods. In addition, TAS is witnessing apparent failures on the part of the IRS to follow various provisions of the IRM regarding the collecting process. For example, TAS has seen the IRS seek extensions of collection statute expiration dates (CSEDs) in apparent contradiction to the terms of IRM § (). In several instances, TAS has also observed the imposition of a levy on assets in a taxpayer’s retirement account even though the requisite “flagrant conduct”* did not appear to be present.

* IRM § () (stating that funds in retirement accounts are not to be levied if the taxpayer has not engaged in flagrant conduct and providing examples of flagrant conduct, including taxpayers who make frivolous arguments, are convicted of tax evasion, are assessed fraud penalties, and hide assets).


The National Taxpayer Advocate is seeing cases in which delinquent tax accounts have sat for five to ten years without meaningful IRS intervention only to be aggressively pursued as the CSEDs draw near. Such prolonged periods of IRS inactivity significantly exacerbate taxpayers’ delinquency problems due to the accumulation of interest and penalties.

The IRM states that seizure should be considered for taxpayers who “won’t pay” and provides a number of examples of such taxpayers (including “taxpayers who have the ability to remain current and/or resolve their delinquent taxes through an alternative collection method but will not do so” and “taxpayers who will not cooperate with the Service, e.g., taxpayers that evade contact, will not provide financial information, etc.”). These examples focus on taxpayers’ present conduct, not their past noncompliance. Yet, TAS is seeing a tendency to use the noncompliance that lead [sic.] to taxpayers’ deficiencies and other past behavior, not the current level of cooperation and willingness to find a way to resolve the liabilities, to justify seizure.