IRS Revenue Officers: Nine Surprising Things To Know
by: Anthony Parent
Dealing with an IRS Revenue Officer can be incredibly intimidating. Especially after the first time one stops by your house or business, completely unannounced. Your heart may be racing -- as you wonder what is going on, and what exactly the IRS can and will do to you. But your anxiety may be misplaced. In this article we dispel the myths that surround Revenue Officers and we give away some keys to using this knowledge for your advantage.
1. A Revenue Officer is not a Revenue Agent.
There is a distinction between an IRS Revenue Officer and an IRS Revenue Agent. A Revenue Officer is employed by an IRS field collection office. Their job is to collect money.
A Revenue Agent, on the other hand, is someone who is employed by the IRS to audit taxpayers. The person who increases your taxes through an audit will not be the person who will be attempting to collect the taxes from you. After the IRS assesses the tax and you don't pay, a series of notices will be sent out. If your tax due is low, you may never get assigned a revenue officer. Your collection case may stay with the centralized Automated Collections System (ACS). Here's more on the difference between the two.
2. A Revenue Officer does not carry a gun.
I think I would carry a gun. People are nuts.
3. A Revenue Officer's badge is a plastic card
If someone flashes a gold badge and says they are from the IRS. That's not a Revenue Officer. That is an agent from the IRS Criminal Investigation Division (CID). Call a tax attorney.
4. A Revenue Officer can not arrest you.
If any CPA, attorney or enrolled agent tells you they can stop a Revenue Officer from arresting you, get away from them...they do not know of what they speak of. Revenue Officers have no arresting authority. All a Revenue Officer can do is make a "referral" to CID. This means they lay out the facts why they think you should be arrested. Referrals usually only happen in the case of fraud. CID only accepts a fraction of those cases referred.
5. A Revenue Officer does not need a financial background for the job
All that is required for a Revenue Officer position is a four-year degree. A Revenue Officer can have a bachelor of Fine Arts and be qualified for the job. This is why Revenue Officers initially engage in months of training and then weeks of training on an on-going basis. The IRS has a lot of money and time invested in their best Revenue Officers.
6. A Revenue Officer isn't graded on how much money they collect
A Revenue Officer does not get promoted for bringing in the most money. Rather, it's how many cases they successfully remove from their "inventory" of collections matters. A Revenue Officer would rather you enter into a "collection alternative" like an offer in compromise than be sandbagged for 2 years, even though you wind up paying in full.
7. A Revenue Officer's powers are sort of limited
The IRS's use of seizures of homes and personal assets is way down. The reason is that the Revenue and Reform Act of 1998 made it very difficult to do so. So, what can a Revenue Officer do? Levy any accounts receivable. Lien property. Levy retirement funds. Levy wages and bank accounts. Subpoena documents. If a taxpayer is dedicated to running up new liabilities and trying to hide their personal affairs, this delays and frustrates the IRS. By making an enemy of the Revenue Officer, a taxpayer seldom helps himself.
8. A Revenue Officer MUST attempt initial contact in person
Everyone thinks their Revenue Officer is a total jerk for showing up, unannounced, at a family gathering, a Rotary club meeting, or a restaurant to make first contact with a taxpayer. This is not because they are jerks (although some are kind of jerky) but rather the Internal Revenue Manual requires that they make first contact with a taxpayer in person.
You may not have been home the first time they showed up, so if you are wondering why someone from the IRS left a card for you at your home or on your car, don't ignore it. They will continue to attempt to contact you.
9. Many Revenue Officers are friendly and reasonable. So too of taxpayers. And that's a problem
A great deal of interactions between Revenue officers and taxpayers are business-like and professional. This can be a bad thing! As stated above, a Revenue Officer just wants to close the case, and many taxpayers just want to get the matter behind them. So both parties, anxious to close the matter, agree to a "collection alternative." The only problem is, in their haste to reach an agreement, neither one looked to see if the agreement is reasonable. Optimism and lack of information about alternatives cause taxpayers to enter into repayment agreements that are not realistic.
At this point, one of two things happen. The taxpayer can't keep up with payments so he stops making the installment agreement, or he stops making current estimated tax payments. Either way, the deal is defaulted. The case will then be placed in a different Revenue officer's inventory. This new Revenue Officer will look at the taxpayer with a jaundiced eye. And worse, the taxpayer blew those important due process rights to appeal --- and appeals are where the most realistic, feasible, and permanent solutions can be reached.
I'm not saying that you can't reach such an agreement with a Revenue Officer, you can, but Revenue Officers' authority is controlled significantly. Many times we've had Revenue officers agree with our proposal, only to have them tell us that they just don't have the authority.
This article was last updated on January 14, 2019.