On March 25, the Internal Revenue Service (IRS) announced its People First Initiative, which rolls out significant changes in compliance and collection procedures to mitigate obstacles presented by COVID-19. The release of this initiative goes well beyond extending the federal filing deadline, with the unprecedented suspension of many compliance programs to assist taxpayers who may be negatively impacted by the economic effects of the viral outbreak.
These provisions are intended to begin on April 1 and are currently scheduled to remain in effect through July 15, but the IRS plans to continue to monitor the situation and may modify or extend the provisions of this initiative as necessary. While the IRS plans to provide more specifics in the near future, key takeaways of the People First Initiative include the following modifications:
Existing Installment Agreements: All payments due between April 1 and July 15 for taxpayers currently under an IRS installment agreement will be suspended. While interest will continue to accrue on the unpaid balance, the IRS will not default any existing agreements for non-payment during this period.
Field and Automated Collections: The IRS has suspended both automatic and field revenue officer-generated liens and levies during this time.
Offers in Compromise (OIC): The IRS is working to assist taxpayers at every stage of the OIC process by extending until July 15 the deadline for submitting supporting documents in a pending OIC, suspending payments due on an accepted OIC until July 15, and continuing to accept new OIC applications for those who qualify.
Private Debt Collection: New delinquent accounts that arise during the April 1 through July 15 period will not be referred to private collection services to pursue.
Field, Office, and Correspondence Audits: The IRS will not initiate new audits during this time, unless necessary to protect the government’s interest in the case of a closing statute of limitations. In-person meetings have been suspended on existing audits; however, revenue agents will continue to hold meetings remotely, and tax
payers are still encouraged to respond to information requests.
Independent Office of Appeals: The Independent Office of Appeals has also suspended in-person meetings but will continue to work its cases.
As the COVID-19 response evolves, Aronson’s tax advisors will continue to monitor changes to IRS practices and procedures and future guidance promulgated by the IRS to best support our clients during this difficult time. If you are facing any of these situations, contact Patrick Deane or one of Aronson’s tax professionals at 301.231.6200.