The Internal Revenue Service (IRS) announced on Monday that it would immediately scale back its practice of sending agents to make surprise visits to homes and businesses. This change comes as part of the IRS’s efforts to upgrade technology, enhance enforcement of the tax code, and improve customer service through a multibillion-dollar modernization project. In the face of political backlash and increased threats to its employees, the IRS aims to boost confidence in its tax administration work and prioritize overall safety for taxpayers and IRS staff.
The IRS Commissioner, Daniel Werfel, stated that this shift in approach is a sensible step towards better serving taxpayers and the nation. He emphasized the agency’s commitment to using resources more efficiently and working constructively with taxpayers, aiming to dispel the public perception of IRS employees going door to door for tax collection.
Furthermore, the IRS has been striving to adopt a more customer-focused approach while combatting fears aroused by Republicans who claim the agency plans to hire an army of 87,000 agents to target small businesses and the middle class. The resulting antipathy towards the IRS has made the work of its agents more perilous. In fact, the agency conducted a comprehensive security review last year after misinformation and false postings on social media led to threats against its employees.
Under the revised policy, unannounced visits will only continue in specific “unique” circumstances, with the agency primarily relying on mailed letters to schedule meetings. Typically, in-person visits were utilized to collect tax debts exceeding $100,000 and demonstrate the agency’s close tracking of taxpayers’ cases. Disregarding written correspondences from the IRS could result in penalties or property liens under the new system.
While the IRS typically performs tens of thousands of unannounced visits annually, this practice will now be limited to cases involving summonses, subpoenas, or asset seizures, which occur less frequently. The agency employs approximately 2,000 unarmed revenue officers who engage in unannounced visits to discuss taxes owed or missing returns. In some instances, visits are made without warning if a business shows signs of falling behind on employment tax withholding or if a debt needs collection.
However, it’s important to note that the change of policy for revenue officers won’t impact the armed agents of the IRS’s criminal investigation unit, who continue to visit homes and businesses.
Republicans have prioritized obstructing the Biden administration’s plans to strengthen the IRS with the $80 billion allocated to it through the Inflation Reduction Act in 2022. They successfully reduced the agency’s funding by $1.4 billion in the June debt limit legislation, and are set to reclaim an additional $20 billion as part of the final budget agreement this year.
In recent months, lawmakers and anti-tax groups like Americans for Tax Reform have raised concerns about unannounced visits by IRS agents. They point to instances, such as a raid on a Montana gun shop in June, during which agents seized personal information of gun owners and buyers, as well as a visit to the Florida offices of investor Jeffrey Gundlach in April, which was triggered by a clerical error, as examples of overreach. Mr. Werfel acknowledged that ending unannounced visits is a response to the prevalence of scammers impersonating IRS agents, which has added anxiety for taxpayers and stress for revenue officers.
Mr. Werfel believes that the IRS has the necessary tools to successfully collect revenue without subjecting taxpayers to the stress of unannounced visits. He expressed confidence that improved analytics will enable the agency to meet its compliance goals, stating that the only losers with this change in policy are scammers posing as the IRS. He also expects that the new policy will alleviate the concerns expressed by members of Congress regarding unannounced visits.
This change in policy is anticipated to be well-received within the IRS, as revenue officers have grown increasingly concerned about their safety during these visits. Officers have sometimes encountered hostile taxpayers brandishing weapons. Tony Reardon, the national president of the National Treasury Employees Union, expressed gratitude for the decision to halt unannounced field visits, emphasizing the paramount importance of IRS employees’ safety, particularly in light of false and inflammatory rhetoric about the agency and its workforce.
In conclusion, the IRS’s decision to curb surprise visits is a strategic move to modernize the agency, enhance taxpayer service, and prioritize safety. The revised policy aims to dispel negative perceptions while addressing concerns raised by lawmakers and anti-tax groups. By leveraging improved technology and analytics, the IRS can proficiently collect revenue and protect both taxpayers and its employees.
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