TPT004 – What to expect while dealing with the IRS Automated Collection Service
There are few things scarier than getting a notice from the IRS about your taxes. They are so impersonal and all seem to threaten to take your stuff or garnish your wages. Today, we talk about how to identify when you are dealing with the IRS automated collection service (ACS) and what that means.
ACS is essentially comprised of two things: a computer that generates letters and collection notices and a call center to handle the incoming calls that the letters create.
The ACS computers send out a series of collection letters beginning with the CP 501 “Reminder” letter, followed by the CP 503 “Important – Immediate Action is Required” letter. Next comes the CP 504 “Urgent – We intend to Levy on Certain Assets” letter and finally the CP 90 Final Notice of Intent to Levy letter is sent.
The first three notice letters sent out by the IRS are done completely free from human interaction. That means there is no revenue officer huddled over your account file creating these notice letters. These are all computer generated notices designed to get you to communicate with the IRS to try to resolve your tax debt. The Final Notice of Intent to Levy (CP 90) can either be sent by the ACS computer or a revenue officer assigned to your case.
Typically, the notices will cause you to call the 1-800 number listed to communicate with the IRS about your case. I have found that constant communication, meeting the deadlines (or at least calling and asking for an extension) keep the IRS happy and prevent them from jumping into active collections like bank levies or wage garnishments. But, you can be sure that if you fail to communicate with them, the ACS computers will begin to look for “fast cash” to help satisfy your tax debt. They find this information in their database that you and your employers have provided through the filing of tax returns, W2s, and 1099s.
One of the main problems with dealing with ACS is that there is no one revenue officer assigned to your case. Remember, this is a call center and when you call the 1-800 number you are going to get the next available operator. If you’ve called before you know because you have likely sat on hold for a long time. The creates issues of fluidity with getting your case resolved. The employee at ACS you spoke with last week may have been helpful and sweet, but the person who answered your call this week may not care about your case, speak in a terse manner, and make your case much more difficult.
But, there are ways to speak with someone outside of ACS that will be assigned your case. If you receive the CP 90 Final Notice you can file a collection due process appeal and that will remove your case from ACS and transfer it to IRS appeals whom you may have a sit-down, in person meeting with or have a telephone conference with. The collection due process appeal must be filed within 30 days of receipt of the CP 90. If you miss that window, the IRS will typically still allow you to have what is known as an equivalent hearing if you file your request within one year of receipt of the CP 90. While you are not afforded all of the same protections you still remove your case from ACS and put it in the hands of an Appeals officer.
While ACS can levy your wages or bank accounts, they cannot seize your personal property. That takes a whole lot more authority than that section of the IRS has so you don’t have to worry about that outcome. Just know, that good communication and follow through can help you navigate your tax issues when you are dealing with ACS.
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Let’s continue this conversation in the comment section below. What questions do you have about dealing with IRS collections?