How you can resist funding the government → my tax resistance → nastygrams from the IRS

As I mentioned I’ve decided to stop paying my self-employment tax. I just got my first letter from the IRS indicating that they noticed.

When I filed my 1040, I indicated that I believed that I was supposed to pay $3,271 in self-employment tax last year. I paid $2501.01 of that, and then decided to stop. $769.99 was still due.

The IRS has charged an additional penalty of $7.70 and interest of $6.52. The penalty was dated , based on a ½% monthly charge. The interest runs from at 7% yearly.

I’m getting 4.15% on my savings account, so to figure out what I’m really being penalized here you have to subtract what I’m earning on the money I’m not paying them from the penalty they’re imposing. Naïvely (that is, not adjusting for compounding), then, the real penalty per day is:

amount I owe × (daily penalty percent + daily interest percent − daily interest I get on the same amount in my savings account)

or:

amount I owe × (0.0164% + 0.0191% − 0.0114%) = amount I owe × 0.0241%

Or, in short, the IRS intends to penalize me something on the order of two-and-a-half cents per hundred dollars I owe, per day.

My unpaid self-employment tax will continue to balloon with each passing year. Come , I’ll probably owe another $3,500–$4,000 in self-employment tax, with another $150 in penalties on top of that. Assuming the penalty rate is roughly the same then as it is now, the penalties on this new amount will run something like $1.15 per day.

That strikes me as something approaching if not surpassing real money, and might be enough to dissuade me from this part of the project if it weren’t for two other considerations:

  1. They have to actually get their hands on the money.
  2. It’s gonna cost ’em.

The first of these considerations is at this point pretty much a hypothetical. I haven’t gone to any trouble to hide my assets, and I’m sure in this post-Patriot Act era, it won’t take much effort for the IRS to find my bank account.

Still, if they follow their standard operating procedure, it will cost ’em $0.45–$4.79 every time they send me one of their notices, and even more if they have to go to the trouble to seize the money. If they turn me over to one of the private debt collectors they’re considering, these bounty hunters will take about a quarter of what they collect for themselves.

So while this may not be a smart investment move for me personally, when it comes to my goal of keeping as much of my money as I can out of the hands of Uncle Sam, the numbers still may add up.


Another month, another letter from the IRS. According to their records, I still owe them $793.40, to which they have added a penalty of $3.84 and interest of $5.35.


Another month, another notice from the IRS. Nothing new, really; just a few more dollars in interest & penalties and a little more bold-face type in the preamble:

Original notice, :

According to our records, you have an amount due on your income tax. Please compare your tax return against the figures below. If you’ve already paid your tax in full or arranged for an installment agreement, please disregard this notice.

Second notice, :

According to our records, you haven’t paid all you owe for tax period . To avoid additional penalty and interest, please pay the full amount you owe . We can file a Notice of Federal Tax Lien if your balance owed is not paid . If you already paid your balance in full or arranged for an installment agreement, please disregard this notice.

Latest notice, :

We previously wrote to you about your unpaid account, but you haven’t contacted us about it. Penalties and interest on the unpaid balance are continuing to increase. Please pay the amount you owe . If you can’t pay now, call us at the number shown below. You may be qualified for an installment agreement or payroll deduction agreement. We want to help you resolve this bill. However, if we don’t hear from you, we will have no choice but to proceed with steps required to collect the amount you owe. If you already paid your balance in full or arranged for an installment agreement, please disregard this notice.

An odd choice of sentences to emphasize, methinks, but I don’t run that asylum. I wonder how many increasingly-wordy and threatening messages some IRS author has composed and whether I can collect the whole set.


since my last notice from the IRS, and another one arrived — certified mail with my signature demanded on delivery — even more full of fire-and-brimstone threats in boldface:

Urgent !!

We intend to levy on certain assets. Please respond NOW.

(To avoid additional penalty and interest, pay the amount you owe within ten days from the date of this notice.)

Our records indicate that you haven’t paid the amount you owe. The law requires that you pay your tax at the time you file your return. This is your notice, as required by Internal Revenue Code Section 6331(d), of our intent to levy (take) any state tax refunds that you may be entitled to if we don’t receive your payment in full. In addition, we will begin to search for other assets we may levy. We can also file a Notice of Federal Tax Lien, if we haven’t already done so. To prevent collection action, please pay the current balance now. If you’ve already paid, can’t pay, or have arranged for an installment agreement, it is important that you call us immediately at the telephone number shown below. Current balance may include Civil Penalty, if assessed.

They also sent me a copy of Notice 1219-B (“Notice of Potential Third Party Contact”) which says that they “may contact other persons, such as a neighbor, bank, employer or employees” if they “need information that the taxpayer has been unable to provide, or to verify information we have received,” and a copy of Publication 594 (“What You Should Know About The IRS Collection Process”).

This will also be a good time for me to review NWTRCC pamphlet #3: How to Resist Collection, Or Make the Most of Collection When It Occurs.


I haven’t had a letter from the IRS , but I got a new one .

It only covers the unpaid tax from my return and makes no attempt to combine this with what I didn’t pay the previous year. This seems to me a strange way to go about it, but I don’t make the rules.

When I filed my return, it showed that I was assessed $3,922 in taxes ($3,952 in self-employment tax minus $30 for the phone tax refund). To this was added $172 as a penalty for failure to pay the self-employment tax in quarterly installments during the year.

This latest IRS notice shows an additional penalty of $39.22, “for Paying Taxes Late” (aren’t they optimistic!), which is based on two months of ½% of that $3,922 per month, which will continue to accumulate until it reaches 25% of $3,922 ($980.50) at which point the penalty maxes out.

Also added is $37.13 in interest, which they’re currently racking up at an 8% annual rate and which doesn’t have a ceiling and so will continue to rise until they seize the money from me or until the statute of limitations runs out.

They also sent along a copy of Form 2210: Underpayment of Estimated Tax by Individuals, Estates, and Trusts and an instruction booklet for that form. These would be useful if I wanted to contest the $172 penalty (if, for instance, I earned all my money in the last quarter of the year and this was the reason why I didn’t make quarterly estimated tax payments). Finally, they sent along the one-page Publication 1: Your Rights as a Taxpayer and a small Notice 1212 promoting their automated telephone service.

I don’t plan to reply to this. The numbers all seem accurate, and their avenues of appeal don’t really apply to someone in my situation. Between this and what I didn’t cough up last year, the IRS is now after me for roughly $5,000.


I got another letter from the IRS .

There’s not much new here. A tiny Notice 1212 and Publication 4127 that advertise their automated telephone service and electronic payment options, and a two page letter showing my current balance and explaining the interest and penalties. The beef of this is as follows:

IMPORTANT
Immediate action is required.

We previously wrote to you about your unpaid account, but you haven’t contacted us about it. Penalties and interest on the unpaid balance are continuing to increase. Please pay the amount you owe within ten days from the date of this notice. If you can’t pay now, call us at the number shown below. You may be qualified for an installment agreement or payroll deduction agreement. We want to help you resolve this bill. However, if we don’t hear from you, we will have no choice to proceed with steps required to collect the amount you owe. If you already paid your balance in full or arranged for an installment agreement, please disregard this notice.

My current balance due is listed as $4,222.07, which includes $19.61 in penalty and $32.11 in interest.

For previous installments in the nasty-letters-from-the-IRS series, see:


I got two certified “sign here please” letters from the IRS, one concerning the taxes I didn’t pay for , the other for . Other than the difference in the years and figures, they were identical packages:

  • A copy of Notice 1219-B: Notice of Potential Third Party Contact which lets me know that the IRS “may contact other persons, such as a neighbor, bank, employer or employees, and will generally need to tell them limited information, such as your name.” It also tells me that I have the right to ask for a list of the people they contacted. Later on in the process, I’ll try to remember to do this.
  • A copy of Notice 1212 which encourages me to use the IRS’s automated telephone service.
  • A copy of Publication 594: What You Should Know About The IRS Collection Process and of Notice 1367: Updated Information for Publication 594 which lets me know that the fee they charge for entering into a pay-by-installment plan has gone up and the rules for Offers in Compromise have changed.
  • A three-page letter listing the balance due, itemizing the latest interest and penalties (though not the cumulative totals of these, which I’ve had to calculate myself by going back to the figures on previous notices), and giving the same “Urgent !!” message as I got .
  • A hopeful return envelope.

I refused to pay $769.99 of my self-employment taxes for . Since then, the IRS has added $100.09 in penalties and $84.02 in interest, bringing the total to $954.10.

I refused to pay an additional $4,094 for , which includes a $172 penalty for failure to pay the self-employment tax in quarterly installments. Since then, the IRS has added $78.44 in penalties and $101.60 in interest, bringing the total to $4,274.04.

So, in sum, the IRS is after me for $5,228.14, of which $536.15 is interest & penalties.

For previous installments in the nasty-letters-from-the-IRS series, see:


I got another one of those certified, sign-here-please letters from the IRS . This one was substantially more beefy than the previous ones:

CALL IMMEDIATELY TO PREVENT PROPERTY LOSS
FINAL NOTICE OF INTENT TO LEVY AND NOTICE OF YOUR RIGHT TO A HEARING

WHY WE ARE SENDING YOU THIS LETTER

We’ve written to you before asking you to contact us about your overdue taxes. You haven’t responded or paid the amounts you owe. We encourage you to call us immediately at the telephone number listed above to discuss your options for paying these amounts. If you act promptly, we can resolve this matter without taking and selling your property to collect what you owe.

We are authorized to collect overdue taxes by taking, which is called levying, property or rights to property and selling them if necessary. Property includes bank accounts, wages, real estate commissions, business assets, cars and other income and assets.

WHAT YOU SHOULD DO

This is your notice, as required under Internal Revenue Code sections 6330 and 6331, that we intend to levy on your property or your rights to property 30 days after the date of this letter unless you take one of these actions:

  • Pay the full amount you owe, shown on the back of this letter. When doing so,
    • Please make your check or money order payable to the United States Treasury;
    • Write your social security number and the tax year or employer identification number and the tax period on your payment; and enclose a copy of this letter with your payment.
  • Make payment arrangements, such as an installment agreement that allows you to pay off your debt over time.
  • Appeal the intended levy on your property by requesting a Collection Due Process hearing within 30 days from the date of this letter.

WHAT TO DO IF YOU DISAGREE

If you’ve paid already or think we haven’t credited a payment to your account, please send us proof of that payment. You may also appeal our intended actions as described above.

Even if you request a hearing, please note that we can still file a Notice of Federal Tax Lien at any time to protect the government’s interest. A lien is a public notice that tells your creditors that the government has a right to your current assets and any assets you acquire after we file the lien.

We’ve enclosed two publications that explain how we collect past due taxes and your collection appeal rights, as required under Internal Revenue Code sections 6330 and 6331. In addition, we’ve enclosed a form that you can use to request a Collection Due Process hearing.

We look forward to hearing from you immediately, and hope to assist you in fulfilling your responsibility as a taxpayer.

Enclosures: Copy of letter, Form 12153, Publication 594, Publication 1660, Envelope

That came in duplicate, with the sum of my unpaid taxes listed on the back. Uncharacteristically, they included both years in the same letter (often they send out one letter per year, so that long-time resisters may get ten certified letters on a single day):

Account Summary · DAVID M GROSS · 567-68-0515
Type of TaxPeriod EndingAssessed BalanceAccrued InterestLate Payment PenaltyTotal
Total Amount Due$5,375.49
1040$784.21$89.86$107.79$981.86
1040$4,170.35$125.23$98.05$4,393.63

Their “Assessed Balance”s seem a little high to me. I’m assuming that’s supposed to be the amount I owed when I filed around April 15th of the following year. My records say these amounts were $770 and $4,094. So either they’ve got a different idea of “Assessed Balance” than I do, or they’ve got a bug, or they’re trying to pull a fast one by ratcheting up the values in the hopes that I won’t notice. Quite possibly, if I don’t object, they’ll be able to stick me with whatever numbers they come up with. Dirty pool, but I wouldn’t put it past them.

The $4,000+ that I was assessed for includes a $172 penalty for failure to file my quarterlies that year, so the total interest and penalties that I’ve accrued so far by refusing to pay taxes is almost $600.

For previous installments in the nasty-letters-from-the-IRS series, see:


complaining about my past-due amount and threatening to issue a levy, I noticed that their accounting seemed a little off.

They’d divided up what they thought I owed them into three categories: “Assessed Balance,” “Accrued Interest,” and “Late Payment Penalty.” But the “Assessed Balance” seemed to me to be higher than it should have been.

As it turned out, the “Assessed Balance” figures in this most recent letter included the interest and penalties the IRS had added in the first letter they sent me.

So I sent them a note about this . This was the first time I’d responded to any of their nagging. My note read:

To whom it may concern:

I recently received the enclosed “Letter 1058” (“Final Notice of Intent to Levy”). I am writing to dispute the amounts involved.

According to the table on the back of this letter, the “Assessed Balance”s for tax years were $784.21 and $4,170.35 respectively. According to my records, these should be $770 and $4094.

I believe you have erred by incorrectly including some of the early penalty and interest amounts in the “Assessed Balance” total, rather than correctly adding those to the totals in the “Accrued Interest” and “Late Payment Penalty” columns. For example, the first “Request for Payment” letter I received from you regarding my unpaid balance correctly showed $769.99 as my assessed balance for that year, and added $7.70 in penalty and $6.52 in interest, for a total of $784.21. This matches the current figure you are reporting as my “Assessed Balance” for that year. I suspect this is not coincidental, and that this is probably the source of the error for the balance as well.

I have not attempted to double-check the interest and penalties figures that you listed in the recent “Letter 1058” and so I reserve judgment as to their accuracy. But given the discrepancy in the baseline figure, I would not be surprised to find that these are inaccurate as well.

It occurs to me that “Assessed Balance” may be a term with a special meaning within the IRS and that I may be wrong in presuming to apply a common-sense definition to it. If so, please let me know what the correct use of this term is.

Otherwise, please correct your figures and send me an accurate accounting of my current balance.

Sincerely,
David Gross

On , I got the IRS’s reply:

Dear Taxpayer [sic]:

Thank you for your correspondence received .

We have not resolved this matter because we haven’t completed all the processing necessary for a complete response. However, we will contact you again within 45 days with our reply. You don’t need to do anything further now on this matter.

If you have a current installment agreement with us, please continue to make scheduled payments while waiting for our response. Even if you do not have a formal installment agreement, you may make payments to reduce the balance owed and minimize interest and penalty charges. To help us apply payments properly, make checks or money orders payable to the United States Treasury, and clearly print your name, the tax year on which you owe, and your Social Security or Employer Identification number on the check.

Following this was some how-to-contact-us boilerplate, then “We apologize for any inconvenience we may have caused you, and thank you for your cooperation.” The letter was signed by the department manager for Automated Collection System (ACS) Support, Collection Operations.

They also, in their optimism, sent me a payment voucher, noting (in all-caps, which I’ll spare you), that I should “cut out and return the voucher at the bottom of this page if you are making a payment, even if you also have an inquiry.”

I believe, in IRS lingo, this is known as an “interim response” — specifically a letter 2645C. My best guess is that a low-level IRS employee scanned my letter in, dated it, gave it a rough categorization, and entered it into their “Correspondence Imaging System” database, but no qualified employee has had a chance to look at it yet, so their computer system automatically generated a “your call is very important to us, please stay on the line” message for me.

Sorry if this is dull, but I hope to keep posting a full account of my interactions with the IRS here so that people know what they can expect. Thusfar, these encounters have hardly been of the edge-of-your-seat variety.

For previous installments in the nasty-letters-from-the-IRS series, see:


Another letter from the IRS . No signature required this time. It appears to be a generic form letter, and has probably the highest desperation-to-information ratio of any I’ve yet received.

The first of the three pages is a request, worded as a command, to “Provide Us With Your Telephone Numbers So We May Contact You” (yes, with every word capitalized), “Enclose your payment, tax returns or other correspondence and return with this cover sheet,” and “Fold this cover sheet so our address appears in the window of the enclosed envelope.”

Page two is the meat, such as it is:

Please Call Us About Your Overdue Taxes or Tax Returns

We have no record that you responded to our previous notices. As a result, your account has been assigned to this office for enforcement action, which could include seizing your wages or property. It's important that we hear from you within 10 days from the date of this letter.

IF YOU AREN'T ABLE TO PAY YOUR OVERDUE AMOUNT IN FULL, please call the telephone number listed above. Be ready to tell us what your monthly income and expenses are so we can help you arrange a payment plan.

IF YOU CAN FILE YOUR TAX RETURN WITH FULL PAYMENT, mail it to reach us within 10 days from the date of this letter. To help us apply your payment correctly, write your taxpayer identifying number and tax period on your check or money order and make it payable to the United States Treasury. Please send us your tax return and payment along with the enclosed return cover sheet in the envelope provided. Keep this letter for your records.

IF YOU CAN'T FILE YOUR TAX RETURN WITHIN 10 DAYS, please call us at the telephone number listed above. To help us determine if you need to file, be ready to provide us with your filing information. For an individual return, this should include your income, filing status, and total federal taxes withheld. For a business return, this should include wages paid, number of employees, and Federal Tax Deposits (FTD) made for payroll.

IF YOU WOULD LIKE SOMEONE ELSE to call us for you, we must have a signed statement from you allowing us to disclose your tax information to this person. You should make your statement on Form 2848, Power of Attorney and Declaration of Representative, which you can get from any IRS office or you can download a copy from the IRS web site (www.irs.gov) You must send us a copy of the completed form before your representative calls.

This letter is signed by “Operations Manager, Automated Collection System” and is identified as a “Letter 2050” (part of the LT-16 packet).

Page three is just an explanation of how they calculate late payment penalties and interest, which is nothing new. Nowhere in the letter do they show the actual amount of what they’d like me to pay them or how much they’re charging me in penalties and interest, as they have in previous letters.

For previous installments in the nasty-letters-from-the-IRS series, see:


afternoon I got the first communication from the IRS that did not appear to have been automatically generated by computer.

It was a large-sized envelope that was mailed from the IRS’s Covington, Kentucky office at a cost of 97¢ and that had my name and address lettered on the front by hand in ball-point pen.

Inside, though, the personal touch was less-evident. Enclosed were four 8½″x11″ sheets, containing two printouts from the IRS’s internal Employee User Portal web application. The IRS employee who generated these printouts had “IRS Employee Number: PQVCB”.

The printouts show my tax balances as of .

My best guess is that this is their attempt to answer my letter of in which I disputed their figures. But these printouts merely restate their figures without addressing the discrepancy I pointed out to them. And there is some new strange accounting that leaves me scratching my head.

The numbers are fairly straightforward, if you accept their idea of what the “Assessed Balance” is:

ACCOUNT BALANCE:784.21
ACCRUED INTEREST:89.48AS OF:
ACCRUED PENALTY:107.80AS OF:
ACCOUNT BALANCE PLUS ACCRUALS:981.49

** INFORMATION FROM THE RETURN OR AS ADJUSTED **

EXEMPTIONS:01FILING STATUS:Single
ADJUSTED GROSS INCOME:14,064.00
TAXABLE INCOME:5,864.00
TAX PER RETURN:3,271.00
SE TAXABLE INCOME TAXPAYER:21,375.00
SE TAXABLE INCOME SPOUSE:0.00
TOTAL SELF EMPLOYMENT TAX:3,271.00
RETURN DUE DATE OR RETURN RECEIVED DATE (WHICHEVER IS LATER)
PROCESSING DATE

TRANSACTIONS

CODEEXPLANATION OF TRANSACTIONCYCLEDATEAMOUNT
150RETURN FILED AND TAX ASSESSED$3,271.00
430ESTIMATED TAX DECLARATION−$625.25
430ESTIMATED TAX DECLARATION−$625.00
430ESTIMATED TAX DECLARATION−$625.38
430ESTIMATED TAX DECLARATION−$625.38
276FAILURE TO PAY TAX PENALTY$7.70
196INTEREST ASSESSED20062008$6.52
971INTENT TO LEVY COLLECTION DUE
PROCESS NOTICE
LEVY NOTICE ISSUED
$0.00

In the tax year, though, something unexpected crops up:

ACCOUNT BALANCE:4,170.35
ACCRUED INTEREST:123.34AS OF:
ACCRUED PENALTY:98.05AS OF:
ACCOUNT BALANCE PLUS ACCRUALS:4,391.74

** INFORMATION FROM THE RETURN OR AS ADJUSTED **

EXEMPTIONS:01FILING STATUS:Single
ADJUSTED GROSS INCOME:13,466.00
TAXABLE INCOME:5,016.00
TAX PER RETURN:3,952.00
SE TAXABLE INCOME TAXPAYER:25,829.00
SE TAXABLE INCOME SPOUSE:0.00
TOTAL SELF EMPLOYMENT TAX:3,952.00
RETURN DUE DATE OR RETURN RECEIVED DATE (WHICHEVER IS LATER)
PROCESSING DATE

TRANSACTIONS

CODEEXPLANATION OF TRANSACTIONCYCLEDATEAMOUNT
150RETURN FILED AND TAX ASSESSED$3,952.00
766REFUNDABLE CREDIT−$25.61
776INTEREST DUE TAXPAYER−$4.39
170ESTIMATED TAX PENALTY$172.00
276FAILURE TO PAY TAX PENALTY$39.22
196INTEREST ASSESSED$37.13
971INTENT TO LEVY COLLECTION DUE
PROCESS NOTICE
LEVY NOTICE ISSUED
$0.00

What are these two items about?

766REFUNDABLE CREDIT−$25.61
776INTEREST DUE TAXPAYER−$4.39

Here again, I’ve only got guesswork to go on. Like most people, I applied for a $25.00 refundable credit for overpaid telephone excise taxes. That was the only refundable credit I applied for, and it’s close enough to the $25 in the table above that I have to guess that’s what it’s referring to. Where the other 61¢ comes in, I have no idea. And how an additional interest charge comes into play is a mystery to me as well. Do you suppose they’ll keep compounding this interest as well until they manage to seize money from me or until the statute of limitations runs out?

In any case, it’s bafflingly weird. It looks like if you paid your taxes like you were supposed to , you could get a $25.00 credit, but if you filed your taxes but didn’t pay, the IRS computer says you’re due a $30.00 credit instead! And “PQVCB” is a number. And “Assessed Balance” equals the actual assessed balance plus the first of the penalty & interest values but not the rest of them. Strange things happen in the IRS’s Mathmagic Land.

For previous installments in the nasty-letters-from-the-IRS series, see:


I got another letter from the IRS . This is the letter that ought to be preceded by a drum roll and delivered with the sound of a falling guillotine blade. It’s not supposed to be followed by a laugh track, but in this case it is. Read on.

The letter is a Form 8519: “Taxpayer’s Copy of Notice of Levy.” If they followed procedure, they sent this notice out to me soon after they filed a similar notice (a 668-A) with Wells Fargo Bank, which holds the account from which they intend to seize my money. Wells Fargo, in turn, is supposed to turn over the amount of the levy to the IRS 21 days after receiving this notice.

“No withdrawals may be made on levied upon deposits during the 21-day holding period,” so I can’t just pull my money out of the account now so as to foil the levy.

They’ve figured the total with interest and penalties out to , and they’re after $5,603.06 all told.

Here’s the gigglicious part: I’ve had this bank account . It was my first checking account. But I started to get annoyed with Wells Fargo because they keep changing their rules around in an effort to stick me with a monthly fee, and because their account features aren’t much to get excited about in this day and age. I mostly like ’em because they have ATMs all over the place in San Francisco.

Several days ago I decided I was going to switch to another bank, and began making the switch — transferring out my remaining balance, changing any automatic deposits and withdrawals, etc.

To make a long story short: Last I checked, I have a total of $5.16 left on deposit at Wells Fargo.

I’m sure they won’t just give up when they discover that their first attempt to seize my assets got them pocket change. They’ll hunt down something else with my social security number attached to it and try to gobble it up as well. But I still think it’s funny.

I imagine that I would not be laughing so hard if I had written any checks on this account that hadn’t cleared yet — that would be expensive and embarrassing. There are some additional risks like these that come from playing chicken with the IRS. Wells Fargo may also try to hit me with some sort of fee for putting up with the IRS paperwork. I’ll keep you posted. Periodically, I plan to tally up these sorts of costs along with the penalties & interest as a way of trying to assess the worth of this method of tax resistance.


I got another letter from the IRS while I was away. This one is particularly baffling.

To catch you up on the story so far: In I decided to stop paying the self-employment tax (I was already resisting the federal income tax by staying below the tax line). So when I filed my return, I didn’t include a check for the remainder of my self-employment tax. I also didn’t pay any self-employment tax , and won’t be paying any when I file my return . The IRS has sent me a number of letters complaining about this, and recently started seizing money from any bank accounts of mine they’ve been able to locate. In they managed to find more than $4,000 which they sucked into their maw.

But get a load of their latest letter to me. Does this make any sense at all?

Overpaid Tax Applied to Other Taxes You Owe

We applied $3,286.79 of the overpaid tax on your tax return to the unpaid balance of other federal taxes which our records show you owe.

You may still be due a refund if we applied only part of your overpayment to other taxes. You also may be due a refund if you recently made a payment against the other taxes that we had not credited when we applied your overpayment. In either case, you will receive a check for any refund due you as long as the amount is greater than one dollar. You must request a refund of less than one dollar. If you have any questions, please call us at the number listed above.

The figures below show our calculation

How We Applied Your Overpayment
Amount of Overpaid Tax on Your Return$3,286.79
Amount of Interest You Earned on Overpayment$.00
Total Amount Due You$3,286.79
Total Amount Applied$3,286.79
Amount You Will Receive as a Refund
(any interest due you will be added)
$.00
Where We Applied Your Overpayment
Form(s)Tax Period(s)Amount(s) Applied
1040$3286.79

The following information may pertain to you if you are currently married or were previously married… [omitted]

My best guess as to what this means goes something like this: I owed unpaid taxes for tax years . When they seized that $4,000+ in , they took more than I owed for , but less than I owed for combined. They applied what they seized to my debt for  — their software apparently isn’t sophisticated enough to split the amount between the two tax years, so the best they could do is to overpay the amount, issue me a refund for that overpaid amount, then immediately seize that refund and apply it to the amount. Then their unsophisticated software issued me an automatic letter awkwardly telling me some misleading version of this story.

(For completeness’s sake, I’ll note that the IRS also sent me a copy of Notice 1212 concerning their automated telephone service and a copy of Publication 1 — “Your Rights as a Taxpayer” — with the letter.)


I got another letter from the IRS .

Why We Are Sending You This Notice

We are writing to you because there is an error on your Federal Income Tax Return. We will explain why we made the change and what you need to do.

Okay. I’m listening.

Why We Made The Change

We changed the refund amount on line 74a or the amount you owe on Line 76 of your Form 1040 because the amount entered on your tax return was computed incorrectly.

Really? How so?

If I turn the page over, there’s a table that shows my figures adjacent to their figures, so we can see where I went wrong:

Line Item On Your ReturnYour FiguresIRS Figures
Adjusted Gross Income$14,823.00$14,823.00
Taxable Income$6,073.00$9,473.00
Total Tax$3,695.00$3,695.00

That difference in Taxable Income comes to $3,400 — the amount of the personal exemption. Apparently the IRS thinks I don’t qualify for it. Maybe someone else tried to claim me as a dependent on their return, or for some other reason the IRS thinks I’m not entitled. Kind of weird, but okay. I’m sure we can clear up this misunderstanding.

What You Should Do If You Disagree With The Change

If you disagree with the change we made or you have additional information that corrects the error we found, please call us at 1‒800‒829‒8374 to discuss your account.

Our representative will explain the change we made. You can explain why you disagree with the change and provide the representative with any corrective information you have. We will correct any mistakes on your account.

It would be more accurate to say “please call us to listen to several minutes of The Nutcracker Suite interrupted by helpful reminders to stay on the line, after which you will be interrogated at length by an IRS employee who will end up knowing nothing about your problem and be unable to help you.”

Because I did call, and did listen to long sections of Nutcracker, until a Mr. Waters answered, and asked me a few questions to verify my identity, and then, casually, as if it were just another “can you verify your zip code” sort of thing, he asked “and where is your primary bank?” Sneaky!

“Look,” said I, “I didn’t expect some kind of Spanish Inquisition. I’d like to talk about this letter I got in the mail today.” And I gave him the story as I’ve given it here to you, up to the Nutcracker part anyway, and Mr. Waters agreed with me that there was a discrepancy. He was unable, however, to tell me why the IRS had done what it had done, or to do anything to correct the problem. He suggested I file a 1040X (“Amended U.S. Individual Income Tax Return”) that simply restates the numbers on my original return.

I’m not sure that it matters all that much, since the “Total Tax” bit is the same and it doesn’t change what I “owe” or anything materially important like that. But I can’t help but feel that it’s the sort of thing that could bite in some difficult-to-foresee way further down the line if I don’t bother myself now with fixing it. Of course, they may just fix it back and continue to refuse to tell me why.

Also, because I didn’t pay any of that “Total Tax” there was also included in the letter the usual blah blah blah about penalties and interest (as of the middle of next month, for what I didn’t pay on , these amount to $18.47 and $3.64), a copy of Form 2210 (“Underpayment of Estimated Tax by Individuals, Estates, and Trusts”) and its instruction manual, and the ever-useful Notice 1212 urging me to check out their fabulous automated telephone service.


I told the story of how the IRS had, for reasons it would not reveal, modified my income tax return to erase my personal exemption.

I called to ask about this, listened to several minutes of the Nutcracker Suite, was probed for revealing information that might help their collection process, and then given no useful information at all.

So I filed a 1040x to try to reinstate my personal exemption. Since then I haven’t heard anything from them.

Today, I went to Where’s My Stimulus Payment to see what feedback that site gives to folks like me whose stimulus payment is likely to be confiscated for unpaid back taxes.

In order to check on the status of your stimulus payment, you have to enter your social security number, your filing status, and the number of exemptions on your return. When I did this, I got the message “We are sorry. Specific information about your Stimulus Payment is not available.” Possibly because “The information entered did not match our records.”

So, remembering that they seemed to be confused about my personal exemption, I tried again, entering zero for my exemptions. This time I got the message “You did not qualify for the Stimulus payment because you were claimed as a dependent by another taxpayer.”

Fantastic. So I call the IRS again. I tap in a bunch of numbers to bushwhack through their phone menu, then listen to 22 more minutes of Nutcracker Suite. Agent Calloway comes on and asks me a set of identifying questions and then, after putting me on hold for about four minutes, is completely unable to help me in any way. She doesn’t know how many exemptions I have in my current tax record, doesn’t have any record of anyone else claiming me as a dependent, doesn’t know if my 1040x has been received and processed — nothing. She suggests I try calling back .


I got another CP 504 notice from the IRS a couple of days ago. Nothing exciting or interesting, just them letting me know that I’d neglected to include a check with my return — pretty much the same package I described in my post but with a new set of numbers attached. For the record, I didn’t pay $3,695 in , and so I got dinged with an estimated tax penalty of $168 when I filed my 1040. , they’ve added an additional $62.94 in interest & penalties.


I received a notice of levy from the IRS. (Form 8159 — Taxpayer’s Copy of Notice of Levy.)

In , they levied an account I was in the process of closing, and ended up with about five dollars. In they levied another bank account and emptied it out to the tune of about $4,350. This new levy is the first one since then.

They’re trying to get $1,385 and they’ll probably get it all, as I have more than that in this account.

This should effectively close out my delinquent taxes for , with them managing to seize all of what I didn’t pay in those years, plus interest and penalties. They don’t seem to be trying to chase me down for what I didn’t pay last year. I think this must be because I had to file a corrected return because they incorrectly modified the return I filed in  — see The Picket Line for for details about that — and this corrected return is probably still making its way through the system.

The three accounts they’ve gone after are three accounts for which they would have gotten 1099 forms reporting interest in previous tax years. That’s no big surprise.

The total they’ve seized includes $4955 in delinquent taxes and $814 in interest and penalties. (This includes the seizure of a small, incorrectly refunded California state tax payment, if you’re wondering why these numbers don’t all add up right.)

What have I learned?

  1. that the IRS will come after accounts it learns about via 1099s
  2. that the amount of time that passes between levies varies, in the case of my three levies, from one month to six
  3. that once it’s started issuing levies the agency will try to keep going until it runs out of delinquent taxes to pursue or sources to levy, even if the amount being pursued falls to a fairly low level
  4. that if a corrected tax return is still being processed, even if the ultimate tax shown on the return is not being disputed, this may put the collection process on hold for that return

If you’re wondering why I’m bothering to resist taxes in this way, since the government has been effective at seizing the money with icing on top anyway, see The Picket Line for for an in-depth look at some of the reasoning behind this.


Okay… remember how , the IRS sent me a letter saying that they’d “corrected” the 1040 I’d filed? And that they did so by eliminating my personal exemption — that $3,400 exemption that everyone is entitled to unless they are claimed as a dependent on someone else’s return? And that they didn’t give any hint as to why they’d taken such a strange step? (And that it didn’t change the bottom-line of what they thought I owed anyway?)

And remember how I called them up and spent a whole lot of time navigating push-button menus and listening to The Nutcracker Suite so that I could speak to an IRS employee who was completely unable to help resolve the mystery in any way, but who suggested I file a 1040x (“Amended U.S. Individual Income Tax Return”) reinstating my personal exemption?

Well, they’ve finally gotten around to accepting my amended return. I just got (two copies of) a letter today:

Dear Taxpayer [sic]:

Thank you for your amended return.

We have adjusted your account as you requested.

If the adjustment results in a refund and you don’t owe any other taxes or other legal debts that we are required to collect, you will get a refund of your overpayment in four to six weeks.

If the adjustment results in you owing money, we will send you a separate notice that will tell you the amount you owe for the tax period shown. If you currently have an installment agreement with us, please continue to make scheduled payments. Even if you do not have a formal installment agreement, you can make payments to reduce the amount you owe and minimize interest and penalty charges.…

What this really amounts to probably isn’t much. I’d imagine it means that the clock will start ticking on the time before I get a notice of intent to levy regarding the self-employment taxes I refused to pay for the tax year.


I got another letter from the IRS . They’ve finally gotten around to sending me a “we intend to levy” notice based on what I didn’t pay on my tax return.

The reason for the delay, I believe, is because of the strange snafu I reported earlier in the year where they incorrectly “corrected” my return to erase my personal exemption and so I had to file a second amended return to put it back where it belonged. , they accepted my amended return and then their collection process could kick into gear.

For those of you keeping score at home, this was a CP 504 letter, which they accompanied with copies of Publication 594 (“The IRS Collection Process”), Notice 1219-B (“Notice of Potential Third Party Contact”), and Notice 1212 (“Use Our Automated Telephone Service”).

They list my current balance as $4,149.85 which includes $166.28 in penalties and $98.46 in interest. But, as I’ve noticed before when they’ve sent me this sort of paperwork, they have a weird way of figuring this. They seem to wrap the first batch of penalties & interest that they assess into the original balance due, and only count subsequent penalties & interest as penalties & interest. I don’t know why.

In reality, my original assessed tax for was $3,695. Because I didn’t pay this in quarterly installments, I was hit with an additional $168 penalty at filing time. Since then, I’ve been assessed $286.85 more in interest & penalties (not the $264.74 given in the letter).


I got another letter from the IRS today about my unpaid taxes from .

This time it’s a “final notice of intent to levy” letter (a.k.a “Letter 1058”) that came by “certified mail” (which meant I had to sign for it). They sent me two copies of the letter, for reasons inscrutable, along with a one-sheet explanation of how they assess penalties & interest, a hopeful return envelope, and copies of Publication 594 (“The IRS Collection Process”), Publication 1660 (“Collection Appeal Rights”), and Form 12153 (“Request for a Collection Due Process or Equivalent Hearing”).

If past experience is any guide, within a few months they’ll try to find some account from which they can seize this money.

If you’re following along at home, in I filed a return indicating that the IRS would expect me to pay $3,863 (which included a penalty for having failed to pay quarterly installments of my self-employment tax). Since then, the IRS has added about $404 in interest and penalties to that amount, so that they’re now after me for a touch more than $4,267.


, the IRS sent me a “final notice of intent to levy” letter, and I braced myself, expecting them to find, freeze, and drain my bank account. But then, nothing.

I got another fat envelope from the IRS and I thought, “well, this is probably it.” But it turned out to just be a bunch of 1040-ES forms for that they optimistically hope I’ll fill out over the course of the year.

Why haven’t they pursued me past the threatening-letter stage? I’ve got three theories, any or all of which might be at least part of the explanation:

  1. They’re after me for less than $5,000, which may fall below a threshold at which they don’t consider it worth their while to do the levy paperwork.
  2. They may be waiting to get ’s 1099s and W2s so they have a fresh list of possible levy / lien targets to choose from.
  3. The agency was forced to pull some of its agents from enforcement duties in order to cope with ’s stimulus payment brouhaha and all of its related confusion. They’re anticipating even more confusion this filing season because of the stimulus payments and Congress is in the middle of further mucking up the tax code. It’s possible that the IRS is just plain too busy to go after folks like me.

On the other hand, the agency seemed to have plenty of time and resources to harass poor Bob Grafe. His story is an exasperating tale of how the IRS treats someone who isn’t in the running to be a cabinet secretary.


It’s been a long time since I’ve seen a letter from the IRS, but I got one yesterday.

Oddly, after such a long time, this was just a letter of complaint (a “Letter 2050”) requesting that I get in touch with them about my overdue taxes from and reminding me of the penalties and interest accruing. No new enforcement action or even any threats of imminent enforcement action, just a vague “your account has been assigned to this office for enforcement action, which could include seizing your wages or property.”

I seem to have been moved to their back-burner for the time being.


It’s been a long time since I got a letter from the IRS. I got two.

The first one I expected. It says: “According to our records, you have an amount due on your income tax” from last year. It then urges me to do something about it and shows me (in a more precise way than I remember from past notices of this sort) how they’ve calculated the interest and penalties so far ($2.66 and $6.73). Enclosed along with this three-page letter are a copy of a one-sheet “Publication 1” (Your Rights as a Taxpayer) and an even smaller “Notice 1212” (suggesting that I use their automated services rather than bother someone on the payroll).

The second letter was unexpected. It tells me that I may have been eligible for the Earned Income Tax Credit last year and suggests that I may have erroneously forgotten to file for it. Sounds crazy, but it might be true. I think I was under the impression that having IRA (Roth conversion) distributions made me ineligible, but I don’t see anything about this in the 2009 paperwork. Perhaps I do qualify. That would reduce the tax I owe by, I dunno, something like $200.

I’d feel pretty dumb to have missed something like this, what with all of my efforts to find good tax credits and deductions.


Following the same pattern as , the IRS followed up on its “you have an amount due” letter with an “Urgent!! We intend to levy on certain assets. Please respond NOW” letter (a CP-504) — certified mail with my signature demanded on delivery, and full of fire-and-brimstone threats in boldface.

The letter also includes an accounting of how much I didn’t pay last year, and the latest interest and penalties on that amount. There’s nothing in the letter about amounts I still haven’t paid from previous years. They seem to mostly operate by pursuing each year in duplicate, parallel efforts rather than trying to gather the amounts into a single, coordinated dossier.

They also sent me a copy of Notice 1219-B (“Notice of Potential Third Party Contact”) which says that they “may contact other persons, such as a neighbor, bank, employer or employees” if they “need information that the taxpayer has been unable to provide, or to verify information we have received,” and a copy of Publication 594 (“The IRS Collection Process”).

In 2006, the letter turned out to be an empty (or at least, premature) threat. I didn’t hear anything more from them until (and that was only about the following year’s unpaid taxes). They didn’t get around to trying to accomplish a levy until , more than a year after the “Urgent!!” notice.


I got another letter from the IRS. If you remember from , they sent me a note suggesting that perhaps I’d forgotten to apply for the Earned Income Tax Credit, since, to them, it looked as though I qualified. I’d assumed that I didn’t qualify and so didn’t bother to do the paperwork, but it looks like I was mistaken. Yesterday’s letter confirms that they have credited me with $143 towards last year’s taxes, meaning now (with a little additional interest & penalties) I only owe them $1,230.88 for .


I got a letter from the IRS while I was away. Nothing exciting. Just a request for my phone number, for the taxes I refused to pay for the tax year, and a “Please Call Us About Your Overdue Taxes or Tax Returns” letter (Letter 2050).


I’ve been away from home for the past several weeks and haven’t had many chances to get to my old-fashioned snail-mail. So I only recently found out that about a month ago the IRS levied a bank account that I closed back in .

They’re trying to get $4,680.14 in blood from that particular stone, which is what they figure I owe (along with penalties and interest) for my taxes. For some reason they aren’t combining that with what I owe for other years but seem to be going after each tax year individually in separate efforts.

I also got a letter from imprisoned war tax resister Frank Donnelly, who seems in good spirits and is looking forward to a release possibly as soon as . He tells me he’s been “getting letters from strangers in support of my tax resistance which makes me proud of my actions.”

If you’d like to drop a line (or send a good book) to Frank Donnelly (or Carlos Steward, also doing time for his war tax resistance), see this Picket Line entry for the correct addresses.


So at this point I owe the IRS roughly $10,000 that I have refused to hand over. They haven’t tried to do anything about it — even to contact me —  when they tried to levy a bank account I’d closed long ago.

Finally I got another letter from them, but it’s very weak sauce indeed. They seem to have regressed to an earlier point in their enforcement flowchart, and only sent me a “Letter 2050” begging that I “Please Call Us About Your Overdue Taxes or Tax Returns” — the same letter they sent me in , , and . It asks me for contact information, explains their penalties-and-interest process, and gives an accounting of my overdue amounts.


I got another letter from the IRS . Nothing special: just them pointing out to me that the tax return I filed for tax year seems to have been missing a check for the amount due.


was the Spring national gathering of the National War Tax Resistance Coordinating Committee. It was held out in my neck of the woods — in Berkeley and Oakland, California — and was organized by Northern California War Tax Resistance.

I was so busy this time around putting on seminars and facilitating workshops and such that I didn’t take very good notes, but here is some of what I remember.

we were treated to a panel featuring Mira Luna, who is active in local alternative economic projects like the Really Really Free Market and a Time-Bank alternative hours-based currency, and Kwan Booth, who is at the forefront of the movement to build a grassroots hyperlocal journalism out of the ashes of the collapsing news media empires and who covers much of the up-and-coming innovations in community organizing.

we had panels and presentations on outreach strategies, in-your-face confrontational war tax resistance, working with Thoreau in the classroom, home-brewing beer as a tax resistance strategy, an introduction to the low-income simple-living tax resistance method, a look at the New Priorities Project… and I’m probably forgetting some others. We also split into a couple of “War Tax Resistance 202” sessions at which people who practice the low-income method or the refuse-to-pay method could get together and talk over the nuts and bolts.

In one of two break-out groups on , experienced resisters talk about their strategies for dealing with the IRS

, our local war tax redirection fund held its redirection ceremony at which it awarded $1,000–$1,500 grants of redirected war taxes to a number of local groups who would spend the money more wisely than the government would. Interspersed with the grant awards were performances by musician Francisco Herrera and a talk from the irascible, inspirational, uncompromising radical lawyer Tony Serra, who has been twice honored by the legal system for his tax resistance by being awarded with prison time — which he compared to “throwing a doctor in a hospital.”

J. Tony Serra addresses the gathering

, the coordinating committee of NWTRCC met to go over business — finances & fundraising, objectives, proposals, changes of committee membership, that sort of thing. This was my last meeting as a member of the Administrative Committee, as two of us rotated off and were replaced by a couple of others.

I signed up for a new working group — the “rapid outreach working group” — which is tasked with identifying emerging groups, actions, and movements that have a message that is harmonious with war tax resistance and reaching out to them to show them how NWTRCC can help them make war tax resistance a useful part of their actions.

Members of the coordinating committee stuck around on to work out the nitty-gritty business of NWTRCC

Coincidentally while the meeting was going on I got two letters from the IRS. One was a copy of a “Notice of Levy” they sent to Fidelity, which holds my retirement accounts, in an attempt to seize money to pay the taxes I refused to pay for the tax year. But the levy explicitly does not apply to “IRAs, self-employed individual retirement plans, or any other retirement plans in your possession or control” so I don’t think the IRS will get anything out of it.

The other letter was a “Final Notice of Intent to Levy” based on what I refused to pay for the tax year. For some reason they sent me two copies of the same notice in the envelope. This notice was packaged with a Form 12153 (“Request for a Collection Due Process or Equivalent Hearing”) in case I wanted to bother with that, a copy of Publication 594 (“The IRS Collection Process”), and a copy of Publication 1660 (“Collection Appeal Rights”).

Each letter had a table on the back showing the amount they were after me for, including “Statutory Additions” (interest and penalties).


Another day, another letter from the IRS. The letters I got were a “Notice of Levy” concerning my tax year unpaid balance and a “Final Notice of Intent to Levy” based on my tax year unpaid balance.

Today I got a “Notice of intent to levy” (CP504) based on last year’s unpaid balance. It came by certified mail, meaning I had to sign for it (my best guess is that this ritual is of no practical significance but is just supposed to make the letter seem more important). They’ve prettified the layout of the CP504 notice, are using a friendlier font, and have made the language a little simpler and less bureaucrateseish, but it seems like mostly the same drill otherwise. It emphasizes that they’ll seize any state tax refund I might be expecting.

This was packaged along with a copy of publication 594 (“The IRS Collection Process”) and Notice 1219-B (“Notice of Potential Third Party Contact”).


I got three letters from the IRS today — the first I’d heard from them since .

Back then, they were sending me notices of “intent to levy” but they seem to have had some reluctance to transform their intentions into action, since no levies were forthcoming.

The latest batch of letters is even tamer. They’re just “Reminder of overdue taxes” letters for , , and (in I didn’t make enough money to owe taxes). They’re mostly notable for the improvement in their layout. The letters have a section with a chart that shows how the interest charges have accumulated during different spans with different interest rates (the interest rates have vacillated some, with the trend declining from a high of 6% in to 3% ).

Tax YearThey think I owed*Subsequent interest and penaltiesTotalSeizedOutstanding
13,7081,65715,3656,0729,292
* may include an initial late payment penalty
$784$255$1,039$1,039 $0
4,170 559 4,729 4,729 0
3,695 633 4,328 3044,023
0 0 0 0 0
1,203 87 1,290 01,290
3,856 123 3,979 03,979

To this you can add another $4,000 or so for , but they don’t know about that yet. That may explain their lack of attention, as my $9,292 outstanding balance is below what I understand to be the threshold at which the IRS feels moved to take action these days.

It wouldn’t be the IRS if they didn’t screw up something, and I notice that their software failed to correctly credit me for the partial seizure in in their page one total (though it does show up in the course of the itemized interest calculations on page two).


I got another letter from the IRS yesterday. Nothing too interesting or exciting — just them letting me know that they’d noticed that I forgot to include a check when I sent in my tax return last month, and that they’re charging me $56.86 in interest and penalties for the bother.


I got another letter from the IRS the other day. This one was sent “Certified Mail,” which meant that my housemate had to sign for it, but this was just for show. It was their “Notice of intent to levy” letter for my unpaid taxes for tax year 2011.

The letter summed up my unpaid taxes ($4,087.86) and interest & penalties ($27.19), and gave me a variety of explanations and pleas for what I ought to do next. Also in the envelope was a “Notice of Potential Third Party Contact” (warning me that they may nose around my employer, neighbors, or bank to ask about my assets), and a copy of an old version of Publication 594 (The IRS Collection Process).

They’ve been sluggish lately about hunting for assets to seize, but this new $4,000+ puts me over the $10,000 in owed taxes threshold at which (it is rumored) they start putting in more effort. So I may see more attention from the agency in the coming months — we’ll see.


I got four letters from the IRS today. I had been starting to wonder: They hadn’t sent me anything since .

These new letters sum up my total unpaid taxes for , , , and (I didn’t owe any taxes in , and I don’t have any outstanding balance for earlier years).

They don’t have any of the bombast, boldface, or exclamation marks of previous letters. Indeed, they’re almost apologetic: beginning with the passive-verb phrase “We are required to send you this notice…” (We wouldn’t bother you, but somebody made us.)

The letters give a careful tally of how the interest charges have accumulated during different periods as the interest rates have fluctuated, but they give no accounting of the penalties, which also accumulate over time in parallel.

Oddly, the “total” interest is shown in two separate places in all but one of the sets of letters, and the numbers do not agree with each other. Okay for government math, I guess.

The notices also don’t show their idea of the original unpaid balance. So, in short, they are a little difficult to interpret.

If you’re curious, here’s what they’re after me for (at least according to some of their incompatible figures):

Tax YearTax+PenaltiesInterestTotal
Total$14,907.36$1,257.67$16,165.03
2007$4,258.97$780.37$5,039.34
2009$1,513.58$124.91$1,638.49
2010$4,704.32$257.42$4,961.74
2011$4,430.49$94.97$4,525.46

I called up the IRS this afternoon and asked them to send me their transcripts for those four tax years in the hopes that they will have more complete figures. I have long suspected that they’re calculating the penalties and interest incorrectly, and the funny numbers in their letters add to my suspicions, but I haven’t ever sat down and done the calculations myself. Maybe I will.

I’m hesitant to get in an argument with the IRS about math of all things, but on the other hand if I do have a valid legal complaint and their software really is too inept to calculate penalties & interest correctly, that might gum up their works pretty severely — I’m reminded of how the hero in Brazil stops a couple of vindictive government workers in their tracks by asking to review their “form 27b-6” — which worked about as well as Dorothy throwing water on the witch.


I got four letters from the IRS that purported to sum up my total unpaid taxes, along with interest & penalties, for , , , and .

Their numbers didn’t add up consistently even within their own printouts, though, so I thought I’d dig a little deeper. I requested my “tax account transcripts” for those years from the IRS. (This is easy to do: you can request your transcripts from the IRS website.) They arrived on (in four separate envelopes, naturally, as the agency’s way of reminding me how respectfully it spends taxpayer dollars).

These are interesting artifacts, but in many ways they only add to my bewilderment. I’ll show you one of the transcripts they sent me below, and add some comments and explanations. The original transcript was two pages — I’ve pasted them together in this illustration.  I added the red circled letters for my annotations below:

My IRS Account Transcript for the 2007 tax year

First, a note: In there was a weird glitch in which the IRS erased the “personal exemption” from my return. Perhaps somebody tried to claim me as a dependent on their tax return, or accidentally filled in my social security number for that of their actual dependent, or maybe it was just a snafu — I never did get an explanation. I simply filed an amended return reinstating my personal exemption and left it at that. It didn’t effect the bottom line in any case, so I didn’t give it much thought afterwards.

The transcript shows my initial tax assessment ($3,695.00), the penalty immediately assessed on me for not having paid any of this in quarterly installments ($168), the initial late payment penalty for not having enclosed a check with my tax return ($18.47), and a small amount of interest that had accumulated at the time of their first delinquency notice to me ($3.64). All of that matches my records. (Ⓐ)

The transcript shows no further activity until , but I actually got another notice in from the Agency, at which time an additional $40.83 in interest & penalties had accrued.

In June they erased my personal exemption, then took note of my amended return in which I reinstated it (Ⓑ). I didn’t get official word that they’d accepted my amended return until . I think their phrase for “we changed the numbers on your tax return” is “Additional tax assessed” since it appears twice on the transcript around here, once to omit the personal exemption and once to reinstate it, though neither of these occasions actually resulted in an assessment of additional tax.

On I got an “Intent to Levy” letter from the IRS for the tax year. This also does not show up on the transcript. That letter listed $166.28 in accumulated penalties and $98.46 in accumulated interest, and asserted that my original tax due was $3,885.11 (which actually is the amount of my original tax due, plus the failure to file quarterly penalty, plus the initial late payment penalty, plus the first amount of interest that accumulated).

On I got a “final notice of intent to levy” letter. This is mentioned in the transcript: both the date it was issued, and the date the IRS was notified that I signed for the letter (Ⓒ). By this time, the accumulated penalties & interest on the original $3,695 tax bill had risen to a bit over $572.

Here something peculiar shows up in the transcript: “Tax period blocked from automated levy program” (Ⓓ). This, just two weeks after they’d issued me a “final notice of intent to levy.” I’m not sure how to interpret this. (Note also that this appears out of chronological order in the transcript, just from perverseness I suspect.) There’s also one of these on my transcript.

When I filed my return in (for the tax year) I had so little income to report that I actually was one of those “lucky duckies” who not only owed no taxes but qualified for a refundable earned income tax credit: a whole $124. The IRS seized this refund and applied it to my unpaid taxes. This shows up on the transcript (Ⓔ).

They also credit me for a “Payment” of $345.19 on (Ⓕ). This was actually a levy of a bank account of mine… so apparently that “block” issued in had been released or had expired by then, or perhaps this levy was not one of the “automated” variety.

I got another letter from the IRS in complaining about the unpaid balance, and then another in . These don’t show up in the transcript either.

The IRS tried to seize another bank account , but I’d long since closed it. By then, the interest and penalties had risen to $985.14. Neither an indication of the levy attempt, nor any amounts of interest & penalties from this period show up on the transcript.

The agency sent me another letter in that doesn’t show up in the transcripts. In , they tried to levy money from the brokerage that holds my retirement accounts to apply to my taxes, but they didn’t try to seize the retirement accounts themselves, and I didn’t have anything else there to seize. That, too, is nowhere to be seen in the transcript.

The next thing that does show up in the transcript, after , is a “reminder of overdue taxes” that they sent me (Ⓖ). This is accompanied, in the transcript, with a late payment penalty of $843.05 (Ⓗ). The transcript also notes the letter it sent me , though it gets the date wrong (Ⓘ).

The transcript also has a summing-up section (Ⓙ), which just makes things worse:

ACCOUNT BALANCE: 4,258.97
ACCRUED INTEREST: 783.27
ACCRUED PENALTY: 0.00

ACCOUNT BALANCE PLUS ACCRUALS
(this is not a payoff amount): 5,042.24

Why does the interest “accrue”, but the penalty just gets added to the account balance? If they just are going to add the penalty to the account balance, why do they bother to have an “accrued penalty” line on the transcript? Why, if this is their policy, do I only have a zero accrued penalty amount on my and transcripts, while my and transcripts do show accrued penalties?

The account balance does seem to add up to my original tax owed plus that original set of penalties and interest (Ⓐ), plus the $843.05 in penalties (Ⓗ), minus what they managed to seize from me (Ⓔ) & (Ⓕ). I can’t tell you how surprised I was to find some set of numbers on the page that added up to another number on the page in a semi-intuitive way, though it took me a while to develop the correct formula, and I couldn’t tell you why they stuff that original interest amount in there.

I was a little puzzled at first as to why they stopped assessing penalties , but I think by that point the penalty had reached its legal maximum — 25% of the unpaid amount. From here on out there will be no more penalties on my taxes, though the interest will continue to accrue.


I got another letter from the IRS a few days back. It was the usual “Notice of intent to levy” letter sent in an intended-to-be-frightening certified mail format (meaning I had to sign for it). It lists the amount I declined to pay for ’s taxes, along with a $21.91 failure-to-pay penalty and $7.62 in interest.

This was accompanied by several paragraphs encouraging me to pay up, telling me what they might do if I neglect to do so, and explaining the interest and penalties. Also in the envelope was a Publication 594 (“The IRS Collection Process”) and a Notice 1219‒B (“Notice of Potential Third Party Contact” — that is, a warning that they might talk to “other persons, such as a neighbor, bank, employer or employees” in the course of trying to track down me and my assets).

Nothing much different here than from years past.


Back in , the IRS sent me a letter telling me that they’d changed some of the numbers on my tax return: raising my adjusted gross income and taxable income by a couple hundred dollars, but lowering my self-employment tax by over $350. I figured I’d probably screwed up somewhere in my spreadsheet, maybe forgetting to update a previous year’s equation somewhere, and so I wrote back to ask them for the details of why they made the corrections they did: what component of my adjusted gross income they increased and why, what part of my tax calculation they adjusted and why (this information was not part of their original letter to me).

Not a very complicated question to answer, you’d think. But since then they’ve sent me two letters on the matter, the latest of which arrived today, over four months since my query. Both essentially say they haven’t had time to get around to it yet.

I expect that most everyone dealing with the IRS is getting this sort of glacial service these days, which ought to help to improve levels of taxpayer resentment and unwillingness to cooperate.


Yesterday I got five letters from the IRS. One each to remind me of my unpaid taxes for , , , , and (I didn’t owe any federal tax in ).

They didn’t include anything ominous, except for the mild warning on the reverse side that if I don’t pay up “interest will increase and additional penalties may apply.” Apparently they are required to send out these bland reminders annually.

The total amount I owe from those years is a little north of $22,000. So I’m a little surprised they aren’t putting more effort into collecting. It’s possible they’re just too overwhelmed with other things to go after small-fry. Or they may be biding their time… the statute of limitations gives them ten years, I believe, so there’s no great hurry. In any case, it’s been ages since they’ve done anything more substantial than sending me letters.


In what has now become an expected routine, the IRS has responded to my failure to include a check with my last tax return by sending me one of their “Notice of intent to seize (‘levy’) your state tax refund [I should be so lucky] or other property.” With $59.32 in penalties and $16.60 in interest, the grand total for is a little north of $6,000.

This came along with some explanations of how they calculate penalties & interest, some pleas to pay up, and a couple of additional inserts: “Notice of Potential Third Party Contact” — which is as far as I can tell mostly designed to try to intimidate you into paying by suggesting that the IRS will send agents around to “your neighbor, bank, employer, or employees” to spread the word that you’re behind on your taxes — and “The IRS Collection Process (Publication 594).”

Luckily for me, IRS audits and other key enforcement programs ‘will operate well below historical levels’ , the federal tax agency’s chief told Congress .”

IRS estimates show “the government will lose almost $3 billion as a result.”


I got some mail from the IRS (though for some reason the letters are dated ).

The letters inform me that I have overdue taxes for six tax years, to which penalties & interest have been added (though they don’t itemize this in the letters; they just give me the totals):

six letters from the I.R.S.
Tax YearAmount Due
Total$30,227.22
$5,350.06
$1,739.53
$5,386.94
$5,444.27
$5,618.97
$6,687.45

As their customary way of reminding me how wisely the government spends tax dollars, they informed me of these amounts in six different letters sent in six different envelopes and accompanied by six return envelopes.

I haven’t sent in my return yet, but I expect it’ll put them after me for another $6,000 or so. In I didn’t make enough to owe anything, so that year is missing.


The IRS noticed that I didn’t include a check with my tax return again this year.

They responded by sending one of their “Amount Due” CP14 letters. It contained a surprise:

Billing Summary
Tax you owed$5,548.00
Payments and credits−12.00
Failure-to-pay penalty55.36
Interest charges15.04
Amount due by $5,606.40

What’s that −$12.00 “Payments and credits” bit?

That is the same amount that I paid for my health insurance this year. I have one of the Obamacare exchange’s heavily-subsidized plans. Indeed, according to the rules, I’m supposed to get this plan for free, but for some reason the insurance company insists on charging me a token $1 per month for it. I’m able to take this $12 as a credit on my tax return (line #69: “Net premium tax credit”).

But the $5,548.00 shown above is exactly $12 more than the $5,536.00 that I calculated on my 1040, so apparently they added this back in on my tax return and then subtracted it as a “payments and credits” amount.

I’m not quite sure what to think of this shell game. Did the IRS trick me into paying $12 in taxes last year by disguising it as health insurance premium payments? Or, because I’m getting free health insurance on Washington’s dime, do I have nothing to complain about?

Included with the letter was an explanation of the penalties (0.5% of what I owe per month, until the amount hits 25% at which point the penalties stop), and interest (currently 3% per year, but subject to change).

Also included was a copy of their new single-sheet Publication 1: “Your Rights as a Taxpayer: The Taxpayer Bill of Rights.” This is a document the agency released with much fanfare a while back. Though called a “Bill of Rights” in mimicry of the set of Constitutional amendments, this bill of rights is thoroughly unenforceable and creates no new obligations for the IRS. It’s more of a “rights we’d like you to think you enjoy until such time as we decide to violate them” list. A cynical “customer relations” sort of ploy.

For example, #2: “The Right to Quality Service” (“Taxpayers have the right to receive prompt, courteous, and professional assistance in their dealings with the IRS…”) was notoriously violated this year: the agency shut down its in-house tax preparation clinics, kept callers on hold for an average of a half-an-hour or so (and even so more than half of those who called in never reached anyone — the agency flat-out hung up on eight million calls without answering them), and refused to answer any but the most basic tax questions. The agency, of course, claimed that Congressional budget cuts were to blame — but they were caught diverting some of their discretionary funds from customer service.


Another letter from the IRS today. This one was the ritual Certified Mail letter that’s supposed to make you sit up and notice because you have to sign for it.

It’s demanding that I pay up my 2014 taxes, announcing that they might levy my state tax refund (as if) “or other property” and giving me their low-down about the collection process, how fines & penalties are calculated, along with a bit of a shaming-threat (the “Notice of Potential Third Party Contact” which suggests they might contact such persons as “a neighbor, bank, employer or employees,” in the hunt for your seizables).

There’s not much new to report, but I’ve made a practice of keeping track of my IRS letters here in order to try to keep a record from which we might be able to discern some patterns in how the agency behaves.


I got another letter from the IRS, which finally noticed I’d neglected to include a check for the taxes due when I filed my tax return.

The $5,007 in taxes due came from the self-employment tax, not the income tax. To this, the agency has added a $25.03 “Failure-to-pay penalty” and $13.15 in “Interest charges”. The letter also includes some information about how these amounts were calculated and how they’ll continue to accrue. Included with the letter was also a copy of the increasingly laughable “Taxpayer Bill of Rights.”


It’s been less than a month since the IRS sent me a notice telling me I’d failed to include a check when I sent in my tax return (see ♇ ). I got a “Notice of Intent to Levy” for .

The notice is dated, confusingly, . Even more confusingly, while the first notice showed that I originally owed $5,007 in taxes, to which the agency added $25.03 in penalties and $13.15 in interest; the new notice says that I originally owed $5,045, to which they’ve added $25.04 in penalties and $11.59 in interest.

But other than that, it’s the usual blah blah that I’ve seen in past years.


Today I got eight letters from the IRS, one for each year in which I have a tax debt (in 2008 I didn’t owe any tax, so that year is missing). Each letter tells me the amount I haven’t paid for that year, including interest and penalties.

They do this every year, so this isn’t unexpected. But there are two things that make it remarkable this year:

  1. The oldest year in the stack is tax year . Since it’s currently , the ten-year statute of limitations clock is really ticking on this one. The agency has until to collect.
  2. The total for those years comes to $46,259. When they notice that I haven’t paid my taxes either, that will bring the total up above $50,000. At that point, according to a new law whose implementation is only now being rolled out, the IRS is supposed to notify the State department that I’m a notorious tax scofflaw, and that agency is then authorized to rescind my passport. I really hope they don’t. But that adds to the risks I’m taking with this approach.

I just got back from Mexico, where I’ve been . In small part, this vacation was a test to see whether I could still travel outside the U.S., as the government is newly authorized to revoke the passports of people like me who have more than $50,000 in outstanding taxes.

The government seems to have other things on its agenda as of late than chasing down scofflaws like myself, however. I had no trouble using my passport. On the other hand, this policy is new, and my overdue taxes only recently topped the $50,000 threshold, so it might just be a matter of time.

In part, my visit was also meant to see whether or not craft beer has finally taken off in Mexico. As of my 2010 visit, it hadn’t, really. I’m happy to report that it finally has. I found a large variety of styles of microbrews from many breweries available in many restaurants and even in a couple of convenience stores.

I didn’t bring my laptop along, but was able to tap in to the news from time to time with my phone and to follow along with delight as the U.S. government continues its headlong rush into disrepute. As the icing on the cake, Chelsea Manning was finally released.

While I was away, NWTRCC held its Spring national gathering. Read all about it at the NWTRCC blog.

Also, for what it’s worth, while I was out I got a routine letter from the IRS complaining that I hadn’t paid my taxes for , and adding small amounts of penalties and interest (about $31) to the total.


I recently got a “Notice of intent to seize (levy) your property or rights to property” from the IRS with respect to my unpaid federal taxes.

This is standard procedure. The IRS does this soon after I don’t respond to their initial letter asking me to pay up. They send the notice of intent to levy letter by certified mail, meaning I’m to sign for it at the time of delivery, as a way of trying to make it seem more like a big deal than their usual letters.

The letter, and an accompanying copy of Publication 594 (“The IRS Collection Process”) give some more clues about how the government may decide to enforce its new powers to refuse or to revoke passports for people with large amounts of unpaid taxes. The impression I’d had before is that the law requires the IRS to notify the State Department once somebody’s unpaid taxes (plus penalties and interest) exceeds $50,000, and at that point the State Department may rescind that person’s passport, refuse to issue that person a passport, refuse to renew that person’s passport, or restrict that person’s passport so that it will no longer be good for anything but reentry into the United States. But I didn’t have much to go on, and I haven’t heard of any cases of this law actually being used yet, so it’s hard to know exactly what to expect.

But here’s how the IRS puts it in Publication 594:

IRS action affecting passports

The Fixing America’s Service Transportation (FAST) Act of , enacted by Congress and signed into law on , requires the Internal Revenue Service to notify the State Department of taxpayers certified as owing a seriously delinquent tax debt. Seriously delinquent tax debt means an unpaid, legally enforceable federal tax debt of an individual totaling more than $50,000 (including penalties and interest) for which a Notice of Federal Tax lien has been filed and all administrative remedies under IRC § 6320 have lapsed or been exhausted, or a levy has been issued. If you are individually liable for tax debt (including penalties and interest) totaling more than $50,000 and you do not pay the amount you owe or make alternate arrangements to pay, we may notify the State Department that your tax debt is seriously delinquent. The State department generally will not issue or renew, and may revoke, your passport after being notified of your seriously delinquent tax debt. For additional information on passport certification visit www.irs.gov/passports.

The “Notice of intent…” letter contains similar text:

Denial or revocation of United States passport

On , as part of the Fixing America’s Service Transportation (FAST) Act, Congress enacted section 7345 of the Internal Revenue Code, which requires the Internal Revenue Service to notify the State Department of taxpayers certified as owing a seriously delinquent tax debt. The FAST Act generally prohibits the State Department from issuing or renewing a passport to a taxpayer with seriously delinquent tax debt.

Seriously delinquent tax debt means an unpaid, legally enforceable federal tax debt of an individual totaling more than $50,000 for which, a Notice of Federal Tax lien has been filed and all administrative remedies under IRC § 6320 have lapsed or been exhausted, or a levy has been issued. If you are individually liable for tax debt (including penalties and interest) totaling more than $50,000 and you do not pay the amount you owe or make alternate arrangements to pay, we may notify the State Department that your tax debt is seriously delinquent. The State department generally will not issue or renew a passport to you after we make this notification. If you currently have a passport, the State Department may revoke your passport or limit your ability to travel outside of the United States. Additional information on passport certification is available at www.irs.gov/passports.

I took another look to see if I could find what the law requires of the State Department once it receives such a certification. What must they do, versus what may they do. Here’s what I found:

Authority to Deny or Revoke Passport.—

  1. Denial.–
    1. In general.— Except as provided under subparagraph (B), upon receiving a certification described in section 7345 of the Internal Revenue Code of 1986 from the Secretary of the Treasury, the Secretary of State shall not [emphasis mine —♇] issue a passport to any individual who has a seriously delinquent tax debt described in such section.
    2. Emergency and humanitarian situations.— Notwithstanding subparagraph (A), the Secretary of State may issue a passport, in emergency circumstances or for humanitarian reasons, to an individual described in such subparagraph.
  2. Revocation.–
    1. In general.— The Secretary of State may [emphasis mine –♇] revoke a passport previously issued to any individual described in paragraph (1)(A).
    2. Limitation for return to united states.— If the Secretary of State decides to revoke a passport under subparagraph (A), the Secretary of State, before revocation, may [emphasis mine —♇]–
      1. limit a previously issued passport only for return travel to the United States; or
      2. issue a limited passport that only permits return travel to the United States.

The www.irs.gov/passports reiterates this:

Upon receiving certification, the State Department shall deny your passport application and/or may revoke your current passport. If your passport application is denied or your passport revoked and you are overseas, the State Department may issue you a limited validity passport good only for direct return to the United States.

I also noticed something new that showed up on my IRS Account Transcripts last month:

I’d never seen this notation before, and hadn’t noticed anything new happen on or about . That particular 971 code isn’t listed at this voluminous list of IRS transaction codes, nor in the IRS’s own Document 6209 in which these codes are spelled out.

I dug around some on-line and found very little information, but tax agent Patti Logan was also sniffing around on the same trail, and here’s what she uncovered:

…the “Initial levy imposed” that we are finding on some of our clients’ account transcripts… is a first step in identifying which accounts meet the criteria of IRC 7345 for passport revocation, denial or limitation. There are four criteria for individuals to have their passport sent to the Secretary of State: 1) Tax must be assessed 2) taxpayer must owe over $50,000 3) a levy has been served in the past or 4) a lien was filed on the account.

So, IRS came up with a new code, transaction code 971 with action code 640, which shows up on the transcript with “initial levy imposed.” This just indicates an account that has had a levy served in the past. It is being put on all individual accounts where a levy has been served no matter if the taxpayer owes $50,000 or not. The other criteria must still be met. So it is not telling the taxpayer that they have been reported to the Secretary of State but it is a first step.…


I got a new (for me) kind of letter from the IRS today.

  • It was headlined as follows:

    Your account has been assigned for enforcement action

    Please call us about your unpaid taxes

  • It was sent by regular mail (not certified mail, like the IRS occasionally uses).
  • It consolidated all of my unpaid tax years (often the IRS will send a different letter for each tax year).
  • There was a lot of boilerplate, but the important text seemed to be:

    We’re trying to collect unpaid taxes from you for the year(s) shown in the billing details below.

    We have assigned your account for enforcement action. Enforcement action may include seizing your wages or property.

    It’s important that we hear from you within 10 days.

The letter leaves it ambiguous to whom they have assigned my account. I looked for some indication of whether they might have assigned it to one of the semi-private debt collection agencies the IRS is now required to send some accounts to. I didn’t find anything to indicate this. But the text about “Enforcement action may include seizing your wages or property” — things the semi-private companies cannot do — suggests that maybe they’re keeping my account in-house.

I’ve heard (but not verified) that the semi-private companies are only being assigned accounts totaling less than $50,000. Mine, according to the letter, currently stands at $51,707.53, so I may have missed the cut-off. Too bad. I was hoping to document that process for you.

The letter identifies itself as an “LT16 Notice,” so it may be an updated version of the letter I got . That letter was followed with an attempt to seize my bank account (they tried to seize an account I was no longer using, though, so the joke was on them). they tried again with more success: seizing an account on which I was a joint signatory. They seized a third account . They made one last attempt in at the account I’d closed and got nothing. Then they got $345.19 from an account of mine . That was their last successful seizure.

So given that the last time I got one of these notices, it was quickly followed by seizure attempts, and that I haven’t gotten one of these letters or been bothered by any seizure attempts since 2009, I should probably brace for trouble. I used the IRS’s “Get Transcript” service to check my latest “Wage & Income Transcript” to see what assets and revenue sources the agency knows about for certain. I was a bit surprised to find that they apparently don’t have anything about my most significant source of income for last year. I’m guessing they just lost or mishandled the paperwork. Lucky me. What do they know about?

  • a small Roth IRA
  • that I transferred $5,000 from my regular IRA into my Roth IRA at a brokerage different from the one that holds that small Roth
  • my Health Savings Account
  • a Lending Club account that by now has less than $100 in it
  • the royalties I get from Amazon for the sales of my books

The IRS tends not to go after IRAs and HSAs until they get desperate. As the clock is ticking on the statute of limitations for the oldest year in my account, though, they may be getting to that stage. If they go after my Lending Club account and my book royalties, they’ll be pretty disappointed by how little they end up with. I can partially stymie them in that case by putting all of my books on sale and stopping the royalties. If they clean out my retirement accounts there’s not much I can do about it. The worst thing would be if they hit my HSA. Not only would they take my money but I’d get hit with a penalty for using my HSA for non-health-related spending (I’m not sure if I could ameliorate this by quickly making a deposit to the account to make up for it).

Coincidentally, at the NWTRCC blog today, Erica Weiland writes about the seemingly haphazard IRS collections process and the letters people receive during it.


The IRS has filed a federal tax lien against me. They could have done this years ago, so it’s something of a mystery as to why they waited so long. They may have decided to strike now because the oldest of my unpaid federal tax amounts will hit the statute of limitations and become uncollectible in a few months, or it may be because the total amount they’re after me for has popped over the $50,000 threshold and that has made them kick things into a higher gear.

The letter announcing the tax lien came to me by certified mail , but I wasn’t around to sign for it so didn’t have a chance to look at it until I picked it up at the post office .

The lien itself was filed by the IRS in our local County Recorder’s office back on .

The lien pursues me for amounts for tax years , but peculiarly does not seem to cover the entire amount for any of those years. I can go to the View Your Tax Account feature at the IRS website to get the latest figures of my account balances. Compare that to what the agency is seeking from me in their lien:

YearMy Tax AccountTax Lien
53,389.8750,437.23
20075,971.685,732.50
20091,932.501,863.87
20105,984.575,772.02
20116,048.275,833.45
20126,384.136,157.39
20138,381.438,083.75
20147,582.577,126.38
20156,449.965,689.67
20164,654.764,178.20

I don’t know how to explain the discrepancy. It’s much too large for it to be just the result of interest and penalties that have accumulated since the lien was filed. Maybe the process of filing a lien is so lengthy that those figures represent accurate numbers from months and months ago when the process began.

How does this affect me? If I owned any serious property, this could be one step in the IRS’s attempt to seize it from me. I don’t, so this isn’t much of a worry. I suppose they might try to seize payments from my business clients or royalties from the sales of my books, but I think they could have done that anyway if they were on top of things.

This lien will likely show up on my credit report, so if I had any plans to try to finance any big purchases, that could get in my way.

If I were to win a court settlement, inherit an estate, or in some other way come into money in a way that’s mediated by the government, the IRS would be likely to intervene and take the money for themselves.

I’m not sure what will happen if the statute of limitations strikes my 2007 account before they are able to collect. Will the whole lien be invalidated at that point, or will I need to challenge it for that to happen, or will the agency refile the lien with new totals?


While I was away I got another letter from the IRS. No big surprises, just a “balance due” notice for my 2017 tax return.


I got another letter from the IRS while I was away last month (it was certified and so I had to go down to the post office and sign for it). Nothing too exciting, just the usual “notice of intent to levy” they send out every year after I send in my tax return without a check to cover the taxes due.


I got another “LT16” letter from the IRS today. It’s the same sort I got last year (“Your account has been assigned for enforcement action”). As far as I can tell it doesn’t really represent anything other than another attempt to use frightening language to try to convince me to cough up some money voluntarily.

It does include a list of all of the tax years and amounts they’re pursuing me for, which confirms that they are no longer trying to collect the amount I didn’t pay in 2007 and that has passed the ten-year statute of limitations for collections, or any of the interest and penalties they attached to that amount. This is the closest I’ve gotten to an official confirmation of that.


Every year the IRS lets me know that it still would like me to pay those taxes for all those years I haven’t been paying taxes.

Rather than doing this like any sane bill collectors would, it sends me a different envelope for each tax year, each one containing the same boilerplate information except for a different dollar amount and tax year.

The waste, inefficiency, and thoughtlessnes of this just makes me that less interested in throwing my money away by giving it to such an organization.


I got another “Certified Mail” letter the other day. Where I’m living now, the post office won’t deliver those to my door but makes me schlep down to their warehouse across town and sign for them. This time I didn’t bother. It was probably the usual “notice of intent to levy” they send me around this time every year.


Today I got a “Notice of certification of your seriously delinquent federal tax debt to the State Department” from the IRS.

This is something new, though it’s not unexpected. In , Congress passed a law requiring the IRS to notify the State Department of people with large tax debts. At the time, large meant $50,000, but inflation-adjustments have caused that to rise to $52,000 today.

I’ve been over the threshold for most of the time the law has been in effect, so it’s something of a mystery as to why it’s taken them so long to get to me. It’s the usual bureaucratic paralysis at the IRS, I expect. I took advantage of the delay to apply for a renewed passport a little while back, and, though I was already “seriously delinquent” at that time, the State Department issued me one without blinking.

So I’ve got several years yet before that passport expires. At that point I guess I become a prisoner here (though I hear the borders are a little leaky). I’m trying to think of it in a romantic way — like being a Soviet dissident or something — and not in a claustrophobic one.

I also will have a little anxiety next time I try to cross the border, not knowing whether they might flag my passport or even try to seize it as I travel. I’m guessing not — that if the State Department decides to revoke it (which is optional: the law says they can do it, whereas in contrast they must not issue me a new passport or renew it) they’ll do so by sending me a letter or something, not by waiting until I’m at a border crossing. But I could be wrong about that.


I got another letter from the IRS today. Pretty much the same “LT16” notice as I got around this time last year and the year before. Nothing new and noteworthy about it.

In other news:


I got another “Notice of Federal Tax Lien Filing” notice in the mail yesterday. It came by certified mail so I had to pick it up at the post office today. It covers and so is meant to extend the previous lien they had filed which, last I checked, covered . The amount is due to reach the statute of limitations expiration date in a few months, so they’d better hurry.

The “Notice of Federal Tax Lien” was filed with my local court system by the IRS. It is meant to put the general public on notice that “there is a lien in favor of the United States on all property and rights to property belonging to this taxpayer.” The agency first filed a lien against me in 2018 and then extended it last year. This did not prevent one of my unpaid tax years from being erased by the statute of limitations. If I needed to borrow a lot of money for some reason, I imagine the bank I was trying to borrow from would probably raise an eyebrow when they learned of the lien, but so far none of my projects has involved borrowing money and I don’t anticipate this changing. The liens have had no practical effect on my life thusfar. The only real effect has been that I get a lot of junkmail from legal firms claiming to be able to settle my taxes for pennies on the dollar.

The notice came with a bunch of inserts: Publication 594 (The Collection Process), Publication 1450 (Instructions on Requesting a Certificate of Release of Federal Tax Lien), Publication 1660 (Collection Appeal Rights), Form 668 (Notice of Federal Tax Lien), and Form 12153 (Request for a Collection Due Process Hearing).


Another day, another nine freaking envelopes from the IRS.

Because it’s the government, the IRS sends me one notice, for each tax year for which I have refused payment, each in its own envelope with its own return envelope and three pages of boilerplate. The letters simply tell me the balance due for each year. A single four-page letter covering all the years would have conveyed the same information at less expense and bother, but they want to remind me how wastefully they squander the money other people give them.

However, for me there was a silver lining in all this boondoggletry. The nine envelopes I got today covered tax years 2010–2018 (I haven’t filed for 2019 yet). Tax year 2009 was missing. This suggests to me that perhaps as far as the IRS is concerned, that year has already hit the ten-year statute of limitations expiration date for collection action and they have given up on it. I won’t formally declare victory for another couple of months as I know a lot of times one of leviathan’s claws doesn’t know what the other claws are doing. I note for example that in the IRS’s on-line tool for checking your tax balance my 2009 tax year still shows as due. But it’s a promising sign.

Meanwhile, the agency still doesn’t have all of its tax forms ready for tax year 2019. I ordered forms back in January , and they’ve been sending them to me in dribs and drabs since then, along with notices saying the rest are not yet available.


Some brief updates:

  • I’ve noticed that Google is indexing less and less of this site. There are something like 3,257 pages at The Picket Line, but Google is only indexing between 1,880 and 2,326 of them, and that number has been dropping in recent weeks. I don’t know why; their policies on what they choose to index are opaque and have a touch of the Kafkaesque to them. Suffice it to say that their index is an increasingly poor record of the content of this site. Unfortunately, it’s also what I currently use for the site search feature, so you may not always be able to successfully search for pages here that way. Consider using the possibly more comprehensive “Bing” search engine instead, or my manually curated topic index if you are having trouble locating something.
  • I filed my tax returns this year at the usual time, back in the Spring. But I filed them on paper, as I typically do, and with all of the pandemic chaos at the IRS it wasn’t until this month that they got around to processing them. And then finally today I got a notice in the mail with the amount outstanding + interest & penalties. There’s nothing surprising here; it’s the usual stuff, just a few months behind schedule.

A couple of days ago I got a “notice of intent to levy” letter from the IRS concerning my unpaid federal taxes for the tax year.

This is par for the course and nothing unexpected. I get these letters every year. More typically they arrive in late Spring or early Summer, though, so this gives you some idea of how far behind the IRS has fallen on their usual enforcement schedule.


I got another set of eight letters from the IRS today. It’s the usual set I get around this time every year, with one letter per year I haven’t paid taxes. The oldest year is missing, as it was last year. I interpreted that as meaning that the agency had given up on it, and sure enough last year they let it slip past the statute of limitations deadline without collecting. I’m hoping the same holds this year. However, there was also a missing year in the middle. The letters were forwarded from my previous address (I just moved at the beginning of the month), so that might have something to do with it.

(The missing year in the middle arrived a couple of days later; the missing year at the beginning has yet to arrive. ―, )

To make a long story short: no surprises here: just their “Annual reminder of balance due taxes” sent inefficiently in separate envelopes because it’s the government.


I got a letter from the IRS that informed me they had notified the State Department that because I have a “seriously delinquent federal tax debt” that I ought to be denied a passport.

That in itself was a little peculiar, because they had already gone through this process back in . Why, I wondered, are they doing it again? By the terms of the law, such a notification to the State Department isn’t the sort of thing that expires and has to be periodically renewed, but is supposed to remain valid until revoked by the IRS.

So I did a little digging. I looked at my account transcripts at irs.gov and discovered that, oddly, the agency had indeed issued its certification of my seriously delinquent federal tax debt in , but then had done it again in and then had reversed that certification in before again reapplying it . There’s no rhyme or reason to that as far as I can tell. My tax debt never fell below the threshold at which they are supposed to make this notification, and even if it had, the way the law is written makes the certification a sort of ratchet: it turns on when your tax delinquency reaches a certain dollar-amount threshold, but then doesn’t turn off until that amount gets all the way down to zero (or you enter into a payment plan or other such formal agreement). This seems to have just been a glitch of some sort.

But that’s not the only interesting part of the notice I got yesterday. It also contained a table of the tax years they’re pursuing me for. It looks like this:

Your billing details
Tax period ending Form number Amount you owe Additional interest Additional penalty Total
12/31/2010 1040 0.00
12/31/2011 1040 6,987.57 42.06 0.00 7,031.63
12/31/2012 1040 7,377.70 44.40 0.00 7,422.10
12/31/2013 1040 9,685.85 58.29 0.00 9,744.14
12/31/2014 1040 8,750.76 52.66 0.00 8,803.42
12/31/2015 1040 7,639.13 45.97 0.00 7,685.10
12/31/2016 1040 6,076.56 36.57 0.00 6,113.13
12/31/2017 1040 7,410.80 44.60 0.00 7,455.40
12/31/2018 1040 7,833.64 47.14 174.03 8,054.81

Two things to notice about this table: First, the blanks in the tax year 2010 row. That’s further verification that the 2010 tax year has slipped beyond the statute of limitations deadline and that the IRS considers it permanently out of reach. Second: the years stop at 2018. The 2019 tax year is conspicuously missing. That suggests to me that they’re still sitting on the tax return I filed more than a year ago, having not yet gotten around to entering it into their databases. It’s further evidence of just how badly things are going for them over there.


I got another letter from the IRS. It’s a “Final Balance Due Reminder — Notice of Intent to Seize (Levy) Your Property or Rights to Property” letter.

This is the sort of letter they send me every year, but it’s a little rushed. It begins “As of , we have not received your overdue tax after sending several notices to you.” That’s got a strange smell to it. This is partially because , and the letter came . But also, they have not sent several notices to me about this.

Indeed, they only got around to processing my return a few weeks ago, and have since sent me only a single letter, correcting what they considered to be an error on my return — I neglected to take advantage of Trump’s one-quarter payroll tax deferral stunt because I would have preferred to have let my full tax amount apply to last year rather than carry some over into this year. Apparently, the IRS thinks that deferral wasn’t optional in my case (the way it was for most employers).

But I guess the IRS delay in processing returns this year has meant that they don’t have time for their usual array of “please pay up now” letters that they typically send before they get to this one (nor, apparently, did they have time to update the “after sending several notices” boilerplate on this one).


I got another set of nine letters from the IRS . It’s the usual set I get around this time every year, with one letter per year I haven’t paid taxes. The oldest year is missing, as it was last year and the year before. I interpret that as meaning that the agency has given up on it: last year and the year before the agency also omitted the envelope for oldest year and then let it slip past the statute of limitations deadline without collecting. I’m hoping the same holds this year.

To make a long story short: no surprises here; it’s just their “Annual reminder of balance due taxes” sent inefficiently in separate envelopes because it’s the government.