Don't Mess With Taxes

Video conferencing is becoming more acceptable, even in IRS communications with some taxpayers.

It's possible that a few good things might come from COVID-19. We might be able to adapt our infection precautions to post-pandemic processes that are more worker friendly and business efficient.

Yes, I am talking about expanded use of technology. And yes, I mean beyond subscribing to every streaming service to fill your days while you were (or are) in isolation mode.

The latest example comes from the Internal Revenue Service. Uncle Sam's tax collector has for years been urging us taxpayers to file our returns electronically and interact in other areas via its website.

Now, with the coronavirus shutting down not only the private sector, but the IRS and other government offices, digital dealings are gaining ground. It's even affected tax dispute resolution.

An IRS effort last month to let folks with tax troubles negotiate settlements online was so successful, the agency is holding more such events this month, starting tomorrow, June 5 in Southern California.

Cutting a tax dispute deal: These virtual tax resolution efforts are the electronic version of Settlement Days.

The IRS has long held Settlement Days, events where taxpayers who don't have legal counsel can get free tax advice from Low Income Taxpayer Clinics (LITCs) and possible pro bono legal representation from American Bar Association (ABA) volunteer attorneys and other similar participating bro bono organizations.

During these events, taxpayers and those helping them can discuss their cases and federal tax issues with members of the IRS Office of Chief Counsel, Appeals and Collections. The goal is to help unrepresented taxpayers get advice and potentially resolve their cases without the need for more litigation or heading to a full-blown Tax Court trial.

The IRS says that most taxpayers who've participated in Settlement Days satisfactorily worked out their cases. Where they ended up owing taxes, many were able to enter into an installment agreement so they could more easily pay that debt over time.

Successful screen-to-screen settlements: In early May, the IRS moved these Settlement Days online.

The shift to virtual resolutions was made because of COVID-19 stay-home orders; individuals' personal circumstances that limit their public outings, especially in this time of serious health threats; and the IRS' own closure of many facilities.

Instead of requiring LITC staffers, pro bono attorneys and taxpayers to travel to designated meeting locations, the Virtual Settlement Days events take advantage of WebEx audio-visual conferencing software. Taxpayers and their counsel then can join events from any location, including their homes.

More virtual tax dealings scheduled: Last month's digital tax deal-making in Atlanta, Detroit and Los Angeles, was so successful — more than 50 taxpayers in Atlanta and Detroit alone had their tax matters amicably resolved, thanks to help from Michigan Law School and North Georgia LITCs — that the IRS has scheduled more Virtual Settlement Days.

Law schools and their students, like these at Georgia State University College of Law, are major contributors to the success of Low-Income Taxpayer Clinics nationwide. (Photo courtesy Philip C. Cook LITC).

The IRS' Office of Chief Counsel in Los Angeles is following up its late-May event with seven more. Representatives from six different Southern California LITCs will be part of these latest virtual resolution efforts.

The upcoming L.A. Virtual Settlement Days are set for June 5 (yes, that's tomorrow), 9, 19 and 23. Three more are set for July 7, 17 and 21.

The Atlanta IRS office has additional virtual settlement events scheduled for June 16 and 17.

The online option also has made it to the home of the IRS. In Washington, D.C., the Office of Chief Counsel there will hold its first Virtual Settlement Day on June 20.

More than 60 unrepresented D.C.-area taxpayers have been invited to participate. Representatives from Catholic University Law Columbus Community Legal Services Low-Income Tax Clinic, American University Law Janet R. Spragens Federal Tax Clinic and Morgan Lewis Center for Public Interest Tax Law and Legal Services of Northern Virginia will be providing assistance to participating taxpayers.

The IRS expects these upcoming digital events to be successful, too, and already is looking to organize more Virtual Settlement Days this summer.

If you have an active Tax Court case, the IRS encourages you to contact the assigned Chief Counsel attorney or paralegal about participating in a Virtual Settlement Days event. If your tax case is currently under consideration by the IRS Independent Office of Appeals, contact the assigned Appeals Officer to discuss case resolution.

Online, but not the only option: IRS Commissioner Chuck Rettig applauded the Virtual Settlement Days, but also noted that his agency will resume and continue face-to-face taxpayer resolution efforts when COVID-19 circumstances allow.

The reason for the return to what some might decry as old-fashioned ways is the reality of accessibility.

Rettig acknowledged that there is a digital divide in this country, meaning that many taxpayers don't have the technological infrastructure that would allow them to interact as needed with the IRS.

Coincidentally (or maybe a piece of COVID-19 karma), in his June 3 Clyburn Chronicles podcast Rep. James E. Clyburn (D-South Carolina) discusses with fellow Rep. Ro Khanna (D-California) how the pandemic has highlighted the need to expand affordable high-speed internet to all parts of the United States.

"Virtual options represent an addition to traditional methods of communication and resolution, not a replacement," said Rettig.

"The IRS strives to assist every taxpayer, including many who do not have the ability to interact in a virtual environment," added the commissioner. "The IRS is open to innovative approaches like the virtual settlement days to help people. We welcome comments from taxpayers and others regarding additional methods by which the IRS can ease the burdens on people of our country facing tax issues."

You also might find these items of interest:

• Digital IRS is costing those who can least afford it
• IRS offers new private tax collector payment option
• Special clinics help low-income taxpayers resolve IRS issues

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