Some taxpayers can expect to get a visit or a courtesy letter from the IRS this tax season–but not necessarily because they are being audited. This time around, the IRS wants to reach out to taxpayers in order to give them tax help advice on how to avoid tax problems.
These letters and IRS personal visits are targeted to educate taxpayers on the tax filing rules and also potential IRS penalties.
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Nicolas Cage just won a deal with the Internal Revenue Service to pay $666,000 plus interest for improperly deducting $3.3 million in personal expenses from 2002 to 2004. Earlier this year, Cage contested a personal IRS bill for $814,000 in taxes, interest and penalties, while his Saturn Productions of Los Angeles company was stuck with a bill for $988,000.
While Cage’s settlement includes $99,000 for an accuracy related penalty, no penalties
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As I mentioned in a previous post, the IRS has recently come under fire by critics who say that the IRS does not do enough to treat victims of identity theft or to help them minimize the burden of responding to the crime.
Many identity-theft victims and their accountants have complained about IRS delays and miscommunications in resolving their claims. The IRS says that they are working hard to help victims
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The IRS Offer in Compromise program provides taxpayers that owe the IRS more than they could ever afford to pay, the opportunity to pay a small amount as a full and final settlement.

This program also allows taxpayers that do not agree that they owe the tax or feel that the tax has been incorrectly calculated, a chance to file an Offer in Compromise and have their tax liabilities
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Working with the IRS To Resolve the Taxpayer’s Problem
One of the most frequent and frustrating aspects of working with the IRS is being transferred from person to person while trying to resolve a tax related problem. Sometimes, this arises as a result of the practitioner either not understanding the central issue or failing to accurately assess which section of the IRS is responsible for addressing the issue. However, the
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The mission of the IRS is to provide America’s taxpayers with top quality service by helping them understand and meet their tax responsibilities and by applying the tax law with integrity and fairness to all.
This is in contrast to the previous Mission Statement which read:
The purpose of the Internal Revenue Service is to collect the proper amount of tax revenue at the least cost, serve the public by continually improving
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Due to Congressional concerns over the growing gap between taxes that should have been collected and taxes that were actually collected, the IRS is moving to reallocate its budget resources. Ultimately, this will be evidenced by a significant increase in IRS personnel and potentially third party collection agencies dedicated to support tax compliance and collection efforts. Recent IRS collection initiatives are yielding increases in both levies and tax revenues collected.
On
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