Wednesday, May 13, 2020

COVID Tax Tip 2020-56: IRS People First Initiative provides relief to taxpayers facing COVID-19 issues

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IRS Tax Tips May 13, 2020

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Issue Number: COVID Tax Tip 2020-56


IRS People First Initiative provides relief to taxpayers facing COVID-19 issues


Due to COVID-19, the IRS' People First Initiative provides relief to taxpayers on a variety of issues from easing payment guidelines to delaying compliance actions. This relief is effective through the filing and payment deadline, Wednesday, July 15, 2020.

Existing Installment Agreements – Under an existing Installment Agreement, payments due between April 1 and July 15, 2020 are delayed. Those currently unable to meet the terms of an Installment Payment Agreement or Direct Deposit Installment Agreement may cancel payments during this period with no default. By law, interest will continue to accumulate on any unpaid balances.

New Installment Agreements – People who can't pay all their federal taxes can establish a monthly payment agreement.

Pending Offer in Compromise applications – Taxpayers have until July 15, 2020, to provide additional information for a pending OIC. The agency generally won't close any pending OIC request before July 15 without the taxpayer's consent.

OIC payments – Taxpayers can delay all payments on accepted OICs until July 15, 2020. Interest may accrue, and missed payments are due when the suspension period ends. Taxpayers can call the number on their acceptance letter to address their needs.

Delinquent return filings – The IRS will not default an OIC for taxpayers who are delinquent in filing their tax return for 2018. However, they should file any delinquent 2018 return and their 2019 return by July 15, 2020.

Non-filers – More than 1 million households who haven't filed tax returns in the last three years are owed refunds. The deadline to get refunds on 2016 tax returns is July 15, 2020.  Those who owe taxes on delinquent returns may visit IRS.gov for payment options. The longer the debt is owed, the more penalties and interest accrue.

Field collection activities – IRS stopped field revenue officer enforcement actions, such as liens and levies. Revenue officers will continue to pursue high-income non-filers and perform other similar activities where necessary.

Automated liens and levies – IRS delayed issuing new automated and systemic liens and levies. Taxpayers experiencing a hardship due to a levy should reach out to their assigned IRS contact or fax their information to (855) 796-4524.

Certifications to the State Department – IRS has delayed new certifications of taxpayers who are considered seriously delinquent. This affects a person's ability to receive a new or renewed passport. Existing certifications will remain in place unless their tax situation changes. 

Private debt collection – IRS will not forward new delinquent accounts to private collection agencies during this period.


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