ASK THE EDD LAWYER – WHAT ARE THE EDD AND IRS COMMANDMENTS OF TAXPAYERS RIGHTS
By Robert S. Schriebman
On January 18, 2017 the IRS released a publication 2017ARD012-27. The Publication is entitled, “How the IRS Taxpayer Bill of Rights Works.” Things can get pretty confusing when it comes to this subject because there have been several revisions of the initial Taxpayers Bill of Rights published about 25 years ago.
The new IRS publication has what I call the 10 commandments for the IRS to protect your rights. If you have a “right” then the IRS has a corresponding “duty” to observe and protect your rights. In this article I will set forth the essence of the new IRS publication as well as give you the EDD version.
Your Rights As A Taxpayer
1. The Right to Be Informed.
The best source of information on this topic is IRS Publication #1, “Your Rights as a Taxpayer.” Basically you are entitled to clarity when it comes to instructions on “How to Comply with the Tax Laws;” as well as a clear explanation of the decisions affecting audits and collection matters. The problem is the system. It is very complex. Letters from the IRS are not clear and are usually form letters. Frankly, I doubt if the IRS can achieve this goal.
2. The Right to Quality Service.
You have the right to receive prompt, courteous, and professional levels of assistance. Remember everyone in the IRS has a boss – everyone. If you do not like the way you are treated at any level, you have a right to say, “stop – let me talk to you supervisor.”
3. The Right to Pay No More than the Correct Amount of Tax.
No one in a government or commercial situation is required to pay one dime more than is owed. The problem is finding out how much is owed. If you owe the IRS get copies of your account transcripts and go over them with a professional, because they have codes that need to be translated and understood.
4. The Right to Challenge the IRS’s Position and Be Heard.
One of the outstanding features of our tax system at the federal level is a structure that allows you to explain your position. Most of the time, you do not have to pay first and explain later. I am very proud that I am the author of the IRS’ Collection Due Process System. Before I brought this to the attention of The Senate Finance Committee, back in the late ’90s, there was no due process when it came to collection matters. That’s all changed now for the better.
5. The Right to Appeal an IRS Decision in an Independent Forum.
If you are audited and disagree with the auditor, you have a right to file a Protest with the IRS Office of Appeals. If you disagree with what the IRS says you owe, you have the Collection Due Process (CDP) system. (See number 4 above.) You also have a right to appeal in refund matters as well as penalty assessments.
6. The Right to Finality.
This rule has to do with the time limits for protesting IRS action. Most IRS notices these days tell you very clearly the deadline for filing any type of appeal. Never wait to the last minute. Send your appeal by a method that proves it was sent. Use a company like Fed Ex or send it via Post office Certified or Registered mail. Make sure the post office “round stamps” your copy of the appeal. These days you can go online to verify that your certified or registered mail was delivered.
7. The Right to Privacy.
The IRS has taken great steps to protect the taxpayers’ privacy. Today the IRS is fighting a never-ending battle against hackers and internet crooks.
8. The Right to Confidentiality.
I think the same thing can be said for number 8 as number 7.
9. The Right to Retain Representation.
Of all the rights this is the most important in my opinion. Whether it is the IRS or the EDD you have a right to stop cold any action by the IRS or EDD until you have an opportunity to seek professional counseling. Unfortunately, here in the office, not a week goes by when someone calls who put the cart before the horse. They tried to handle the matter themselves and if things don’t work to their satisfaction, then they seek professional advice. Don’t be one of these people.
10. The Right to a Fair and Just Tax System.
This is the so-called “level playing field” right. There are often hearings by Congress that attempt to put a lid on overzealous IRS demands to look into internal affairs or how taxpayers do business, all in the name of “transparency.” Unfortunately the IRS would like to have this only one way.
The EDD Version
EDD Publication DE195 is entitled “Employers’ Bill of Rights.” There is not much in it. Most of it concerns collection activity. The important portions that relate to audits are few. For example, you have the right to courteous and timely service and the right to appeal an assessment, etc. Most importantly you have a right to an impartial audit. I have used this right many times to move audits to different EDD offices and sometimes remove an abusive auditor.
Robert Schriebman has a successful practice in the Rolling Hills Estates area of Los Angeles County serving clients throughout California and the United States. He has successfully dedicated more than 40 years to helping individual taxpayers, business owners, CPAs, Enrolled Agents, and tax attorneys navigate the complicated tax systems of the federal and state governments.
Robert Schriebman has written the only 2 books ever published dealing with how California Employment Development Department (EDD) operates. See “California Tax Collection Practice and Procedures” and “California Taxation Practice and Procedure,” both published by Commerce Clearing House.
Robert Schriebman has written over 20 books including the major manual used nationally by practitioners and the IRS, “IRS Tax Collection Procedures – A Manual for Practitioners” published by Commerce Clearing House.
Robert Schriebman has written over 20 books including the major manual used nationally by practitioners and the IRS, “IRS Tax Collection Procedures – A Manual for Practitioners” published by Commerce Clearing House in addition to the only 2 books ever published dealing with how California Employment Development Department (EDD) operates. See “California Tax Collection Practice and Procedures” and “California Taxation Practice and Procedure,” both published by Commerce Clearing House.
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