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Will the Internal Revenue Service be Knocking on Your Door?

Will the Internal Revenue Service be Knocking on Your Door?

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On February 19, 2020, the Internal Revenue Service (IRS) announced that it is stepping up efforts to collect on the $441 billion in outstanding taxes due by increasing face-to-face contact with taxpayers through home visits. The new program, made possible by a boost in the number of IRS enforcement personnel, focuses on high-income individuals who have failed to file tax returns for 2018 and preceding years. The IRS defines high-income as reported earnings of $100,000 or more. Click here to read the IRS news release.

So, what should you do if the IRS shows up at your door? First, before letting individuals into your home, verify their credentials. Recently, Price Kong was contacted by a business owner who was out of the office when an IRS agent showed up to conduct a payroll tax audit due to an alleged clerical error. The business owner was skeptical about whether the individual, who left a hand written business card, was truly an IRS agent. After numerous attempts, Price Kong was able to confirm that the individual was indeed an IRS agent, albeit, apparently a new or poorly trained one.

If you are the subject of a visit by an individual claiming to be an IRS agent, there are a few things you need to do to protect yourself. First, politely request two forms of official credentials that include a serial number and photo. It is the taxpayers right to examine these credentials. Click here to read more on how to identify an IRS agent.

You also have the right to representation and are not obligated to answer any questions immediately or directly. Even the most seemingly innocent of comments can turn a routine inquiry into a full blown, multi-year audit. Consider hiring a certified public accountant (CPA) to assist with any IRS issue.

Do not ignore IRS inquiries, whether in person or writing. Doing this will only cause bigger issues later on. Collect contact information and advise the agent that your CPA will be in touch.

Price Kong has extensive experience assisting taxpayers with reconciling outstanding taxes and becoming compliant. If you need assistance with filing past returns, please feel free to contact me at [email protected] or 602.776.6333.

About the Author

Brian Walker’s practice is backed by more than 20 years of diverse tax, financial, and business consulting experience. His clients represent a wide range of industries, including manufacturing, technology, wholesale, retail, construction, and real-estate. Brian is dedicated to helping clients achieve success through practical and sound tax and financial advice tailored to their unique objectives and goals. He is a member of the American Institute of Certified Public Accountants (AICPA) and the Arizona Society of Certified Public Accountants (ASCPA). Brian earned a Masters of Taxation from San Diego State University and Bachelors of Science in Accounting from California State University San Marcos.

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(602) 776-6333