Boston Tax Collection Enforcement Defense Lawyer
Boston tax collection attorney Theodore L. Craft has been quite effective in obtaining concessions from the IRS in tax collection enforcement matters. He does not abuse the system. Attorney Craft has for many years conducted credible negotiations with the IRS in this area. Promises Made must be genuine. When Attorney Craft engages in collection forbearance negotiations with the IRS, he has first helped his client towards the attitude of cooperation and effort to qualify IRS concerns about financial assets. The fairness of a proposed bargain on financial evidence is critical. The client cannot be set up for failure. Neither can the IRS give away the Government's money willy-nilly where the taxpayer owes it and has it by him. On the other hand, Mr. Craft defends clients into litigation if necessary against the heavy hand of the IRS.
IRS Enforced Tax Collection
A taxpayer whose assets and income are under attack by IRS enforced tax collection is not without legal defenses. A variety of procedural actions within the IRS and, if required, in the courts, are available to postpone or in some manner restrict such collection activity.
Tax Collection by Private Debt Collection Companies
The American Jobs Creation Act (Section 6306 of the Internal Revenue Code), which became effective on October 22, 2004, permits private debt collection companies to obtain taxpayer financial information and to offer installment plans for payment of delinquent taxes. However, the IRS “Revenue Officer” is the most powerful collection arm of the IRS.
Tax Collection by an IRS Revenue Officer
The Revenue Officer’s powers to distress a taxpayer who is delinquent in tax responsibility (tax compliance or payment) are awesome. The revenue officer has the authority to file a notice of federal tax lien (which defeats any secured creditor or judgment not on record as required by law before the date of the tax lien) or notice of intention to Levy.
Federal Tax Liens
The federal tax lien is created by assessment of tax, notice and demand for payment, and non payment. Even before notice of the federal tax lien is filed, there is a general rule of attachment under the Internal Revenue Code that gives the United States a claim upon all property and rights to property of a taxpayer. In addition, anything acquired by the taxpayer after the lien arises is immediately attached by the general tax lien.
- Spouses, Tenancy by Entireties and Federal Tax Liens. In United States v. Craft, 535 U.S. 275 (2002), the United States Supreme Court decided that the federal tax lien of one spouse resulting from the separate tax liability of the other spouse attaches to the property held in a tenancy by entireties. Thus, individual rights in the estates sufficient to constitute “property” or “rights property” exist for purposes of a tax lien under Section 6321 of the Internal Revenue Code to attach such code.
- Homestead Exemption and Federal Tax Liens. The Homestead exemption does not preclude attachment or execution of the federal tax lien. Even if only one spouse is liable for the tax debt and the non taxpayer-spouse has a homestead interest, the federal tax lien attaches to the entire property and that property can be seized by the IRS and the interest sold in an administrative or judicial sale.
- Alimony and Federal Tax Liens. Even alimony payments are subject to attachment by the federal tax lien (child support payments, on the other hand, are not because these are the property of the child and not the taxpayer-parent).
Levy Authority • Writ of Entry
The IRS may proceed to levy upon property to collect a tax liability after proper notice. Under the levy authority, the IRS can seize property held by the taxpayer or a third party. There are appeal procedures during enforced collection proceedings (a Collection Due Process Appeal or an Offer in Compromise), during the prosecution of which the IRS is prohibited from levying upon a taxpayer’s assets. The IRS may obtain a writ of entry to enter private premises to seize property. A writ of entry, however, is only necessary if the IRS needs to obtain access to areas where the taxpayer has a reasonable expectation of privacy.
Levy Against Taxpayer’s Interest in a Bank Account
The most common levy in the IRS’s toolbox of collection devices is a levy against the taxpayer’s interest in a bank account. If administrative resolution of the tax liability is unlikely, and no administrative agreement can be reached with IRS, the depository institution, after holding the levied funds for 21 days, is required to turn over the funds to IRS to the extent of the levy.
Suspending Enforced Tax Collection • Enhancing Tax Collection Probability
A taxpayer may be in a bargaining position with the Revenue Officer in charge of a case if negotiations to suspend enforced collection appear to enhance collection probability. This assumes that all tax returns for all periods subsequent to the years of the unpaid liabilities have been filed. The one critical aspect of IRS enforced collection to be clearly understood is that IRS will not permit a taxpayer to pyramiding tax liability; that is the IRS will generally not negotiate a forbearance of enforced collection if the tax compliance situation is chronic and repeated.
Schedule a consultation: Contact Boston Tax Collection Lawyer Theodore L. Craft.
Tax Law Practice
Concentration in all tax issues with the Internal Revenue Service and the U. S. Department of Justice, Tax Division
Formerly Special Trial Attorney, Civil and Criminal Business, IRS Office of Chief Counsel and Senior Trial Attorney, Refund Litigation Division, as Liaison to the United States Department of Justice, Tax Division, Washington, D. C.
Theodore L. Craft, Attorney at Law
49 Myrtle Street
Melrose, Massachusetts 02176
Telephone: 781-665-6872 | 617-523-7600 | 1-888-TAX-RISK
Fax: 781-662-2430
Email
Boston tax attorney Theodore L. Craft serves clients throughout Massachusetts and southern New Hampshire, including Cape Cod, Martha's Vineyard, The Berkshires, and the communities of Melrose, Springfield, Cambridge, Worcester, New Bedford, Dedham, Plymouth, Lynn, Saugus, Medford, Somerville, Waltham, Newton, Milton, Quincy, Hingham, Weymouth, Brockton, Marlborough, Peabody, Danvers, Agawam, Ludlow, Westfield, Chicopee, Holyoke, Northampton, Auburn, Middleborough, Wareham, Duxbury, Longmeadow, Peabody, Salem, and Danvers, MA, as well as, Nashua, Manchester, Merrimack, and Londonderry, NH.
Suffolk County • Middlesex County • Worcester County • Norfolk County • Plymouth County
