In TAS-13-0521-0005: Interim Guidance on Accepting Cases Under TAS Case Criteria 9, Public Policy (05/06/2021) the National Taxpayer Advocate (NTA) put out guidance on the public policy cases Taxpayer Advocate Service (TAS) will accept. The guidance regarding case acceptance expires on May 5, 2023. Under Code Sec. 7803(c)(2)(C)(ii), Congress listed several types of cases in which TAS will assist taxpayer and gave the NTA the authority to determine additional matters in which TAS will assist taxpayers.
TAS wants to assist taxpayers in situations in which it can provide meaningful assistance but does not want to waste time where it cannot help. A good example of a place where it cannot help has occurred because of the pandemic. Many taxpayers want to know what has happened to their refund or other correspondence. TAS cannot provide much assistance because in a high percentage of these cases the correspondence sits in a tractor trailer waiting for someone at the IRS to process the mail. Until the case gets into the IRS system in a meaningful way, the situation ties the hands of TAS, making those missing or delayed correspondence cases ones where TAS cannot really provide assistance. TAS divides the criteria it uses to decide when it will assist taxpayers (“case acceptance criteria”) into nine categories. (Internal Revenue Manual (IRM) 220.127.116.11)
Category 9, sometimes known as the public policy assistance category, provides that TAS will assist taxpayers with cases that:
- The NTA determines warrant TAS assistance due to a compelling public policy, and
- Don’t meet the case acceptance criteria for any of the other eight case acceptance categories. (IRM 18.104.22.168.4)
In the recent memo the NTA shares her determination that the TAS will accept the following four issues in its public policy category. Some of these carry over from prior determinations:
- Cases involving the automatic revocation of an organization’s tax-exempt status for failure to file an annual return or notice for three consecutive years. This one goes back for several years when the IRS first came out with his plan for purging exempt organizations that seemed to no longer exist or, at least, no longer communicate with the IRS;
- Cases involving any tax account-related issue referred to TAS from a Congressional office. Going to a Congressional office as your entrée into the IRS generally greases the skids. TAS is especially responsive to Congressional correspondence and makes regular visits to local and national Congressional offices. Note that even though TAS wants to do everything it can to please the Congressional offices, it creates exceptions here to reflect its utter inability to accomplish certain tasks where the IRS has not processed correspondence:
- Cases involving Economic Impact Payment (EIP) issues, and
- Cases involving the exclusion from income of unemployment compensation received during tax year 2020 under Section 9042 of the American Rescue Plan Act of 2021 (ARPA, ARP Act; PL 117-2), where the taxpayer who filed their tax year 2020 return before ARPA was enacted;
- Cases involving revocation, limitation, or denial of a passport because, under Code Sec. 7345, the taxpayer has a seriously delinquent tax liability (i.e. a tax liability of more than $50,000, adjusted for inflation). It added this one when the legislation because effective. You can find blog posts by the NTA through this link even though the title of our post indicates a discussion of private debt collection. It can make a big difference to have TAS advocating for you on this issue if you need a fix in a hurry. Keep in mind that TAS cannot perform magic here. The taxpayer needs to be able to show that a seriously delinquent tax liability does not exist or that the taxpayer has made the necessary payment to resolve the liability; and
- Cases that have been referred to a Private Collection Agency for collection of a federal tax debt under Code Sec. 6306. This one has been around since private debt collection returned. Nina Olson did not like private debt collection. She is not alone. See here and here. She pushed to eliminate it the first time it came into existence. She created this exception when Congress resurrected private debt collection and it has remained on the list.
The changes to the list are really changes to criteria 2. to reflect TAS’ inability to fix something. Keeping up with the public policy list allows you to know when you can successfully obtain the assistance of TAS to advocate for a position within the IRS. Of course, knowing the criteria other than Number 9 can also be quite helpful. For those needing a reminder, here is a list of the other bases for seeking TAS assistance:
Economic Burden. Economic burden cases are those involving a financial difficulty to the taxpayer: an IRS action or inaction has caused or will cause negative financial consequences or have a long-term adverse impact on the taxpayer.
- Criteria 1: The taxpayer is experiencing economic harm or is about to suffer economic harm.
- Criteria 2: The taxpayer is facing an immediate threat of adverse action.
- Criteria 3: The taxpayer will incur significant costs if relief is not granted (including fees for professional representation).
- Criteria 4: The taxpayer will suffer irreparable injury or long-term adverse impact if relief is not granted.
Systemic Burden. Systemic burden cases are those in which an IRS process, system, or procedure has failed to operate as intended, and as a result the IRS has failed to timely respond to or resolve a taxpayer issue.
- Criteria 5: The taxpayer has experienced a delay of more than 30 days to resolve a tax account problem.
- Criteria 6: The taxpayer has not received a response or resolution to the problem or inquiry by the date promised.
- Criteria 7: A system or procedure has either failed to operate as intended, or failed to resolve the taxpayer’s problem or dispute within the IRS.
Best Interest of the Taxpayer. TAS acceptance of these cases will help ensure that taxpayers receive fair and equitable treatment and that their rights as taxpayers are protected.
- Criteria 8: The manner in which the tax laws are being administered raises considerations of equity, or has impaired or will impair the taxpayer’s rights.