Besides making mistakes that place taxpayers in a bind, the IRS also sometimes conduct seizures that prove to be illegal. Perhaps as many as 30 percent of such seizures violate the law in some manner.
There have already been instances of alleged wrongdoing on the part of the agency. Many conservative groups claim the IRS targeted them to excessive scrutiny. The IRS also faced accusations for seeking excessive reimbursement of various expenses.
A recent report documents issues that arose concerning IRS seizures of property belonging to taxpayers. The improper seizures concern the taking of taxpayer property because of a supposed failure to pay back taxes.
There are limits on what the IRS can do concerning seizures
There are safeguards in place designed to prevent improper IRS action. In recent decades, Congress enacted various legislation to put protections in place. Protections include requirements of the Treasury Inspector General for Tax Administration to yearly evaluate IRS activity. This includes reviewing IRS policies regarding property seizures.
While an examination of a number of seizures revealed that the IRS generally followed procedures, there was a significant number of instances (approximately 30 percent) where the IRS did not follow the tax code requirements. A small sampling of IRS actions revealed the selling of seized property without proper advertising. There was an instance of an incorrect listing of the amount of liability. There was an incorrect application to taxpayer accounts of proceeds from seizures. And there was an incorrect listing of the taxpayer’s balance after a sale took place.
How can you protect yourself?
While the IRS has the power to seize assets in certain instances to collect back taxes, the agency still has to conduct such actions legally. Experienced tax attorneys understand the sorts of strategies taxpayers can take to put a stop to improper IRS seizures. They can also work with the IRS to come up with alternate ways to resolve issues taxpayers may have with the IRS.