The Taxpayer’s Bill of Rights

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DARRIN T. MISH: Good morning, this is the IRS Solution Attorney, Darrin T. Mish.

KATRINA MADEWELL: And I’m your co-host, Katrina Madewell, thanks for joining us today.

DARRIN T. MISH: I never realized how hard doing live radio was until just this morning.

KATRINA MADEWELL: When you’re fumbling around with your iPad and trying to figure out how to get it up and make it go live. Then the intro music starts playing and you’re like…wait a minute!

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DARRIN T. MISH: Literally trying to do a Facebook post, trying to turn on Facebook live on two devices. Trying to remember that I need audio to go live. Trying to get the headphones on my head. All of that just happened. So, good morning.

KATRINA MADEWELL: T-minus 10 seconds and counting.

DARRIN T. MISH: I think it was more like T Plus five seconds, but hey, we’re here.

KATRINA MADEWELL: We’re here. Welcome to the show.

DARRIN T. MISH: I met with a gentleman yesterday with a tax problem. He’s had the tax problem more than ten years. He’s been dealing with it since 1991. He’s a fan of the show, which I think is extraordinarily cool. One thing he said was we don’t say the office phone number enough on the show.

KATRINA MADEWELL: Yes, we don’t say the office phone number enough.

DARRIN T. MISH: Katrina is the one that remembers to say the office phone.

KATRINA MADEWELL: He threw Katrina under the bus. He said it’s all Katrina’s fault.

DARRIN T. MISH: To the contrary, I was giving you credit for ever saying it at all. He was driving around in his work truck, and he said, “say the phone number, say the phone number.” And true to form, Katrina said the phone number. The phone number at the office is 888-GET-MISH.

KATRINA MADEWELL: So, he was looking for you.

DARRIN T. MISH: He was. At my law firm, we help people who have problems with the IRS. Here on the show, we talk about IRS problems and how to solve them. I’m not just about getting a fee, I’m not just about getting the client, I’m here to help. It’s sincere, it’s not an act.

KATRINA MADEWELL: You have to be passionate about what you do.

DARRIN T. MISH: I’m not asking for sympathy here, but after a two-hour drive in the morning to get here through traffic, I’m not always in the most chipper of moods. Sometimes I’m saying to myself, “what am I doing here? Why am I doing this?” The real answer is, I want to help people who have tax problems. It’s a big deal to them. It’s usually the biggest problem they have in their life. Oftentimes, it’s the catalyst of other problems that are going on in their lives. I’m passionate about that.

KATRINA MADEWELL: You can only reach so far. This is a great station. We love Beasley, we love being here at Money Talk 1010. You can catch us at 1010am. If you have popped over yet, to 103.1fm, you can pick us up on the FM station. If you have HD radio in your car, we’re on 99.5. Usually, we’re streaming live on Facebook, but we’ve had some challenges.

DARRIN T. MISH: It’s the Wi-Fi. Every time we try and use the in-house Wi-Fi, we have problems with the Facebook live stream. That’s not really that entertaining of radio. So today we’re going to talk about something that is near and dear to my heart, and that’s the taxpayer bill of rights.

KATRINA MADEWELL: I can’t wait to talk about this one.

DARRIN T. MISH: As taxpayers, as US citizens and permanent residents, people who have to pay taxes in the United States, we have rights, which is amazing. When we typically think of the IRS, if you don’t have a lot of experience with them, you may think you don’t have any rights. That they can run over you. They can say you owe a bunch of money and not have any rules.

KATRINA MADEWELL: You feel like you’re fighting the big dog. Who wants to take on that fight other than you? Nobody I know.

DARRIN T. MISH: Exactly. We don’t always take them on in a confrontational way, but we do strongly advocate for clients. That’s what we’re here for.

KATRINA MADEWELL: I keep prompting Darrin and asking him and hoping one of his clients will go on the air and talk about their IRS problem and share their story. I’m hoping they’ll be able to talk about after it’s all done and talk about the beginning, their emotions, and where they landed. It’s one thing to hear it from you, it’s another to hear it from your client.

DARRIN T. MISH: I feel like a broken record talking about people that have tax problems and are unhappy. But, I had a client come in the week before last and I can’t remember what the details are, but we saved him a lot of money. He indicated to me that he would come live on the show. I just need to get in touch with him. In fact, we can put him on the spot. We could call him during the break and see if we can get him on.

KATRINA MADEWELL: Ok. Pat, we have some homework for you. We’ll do that. We should probably jump into the taxpayer bill of rights. If you’re streaming live, we want to apologize because the Wi-Fi is not the best. We’re trying to get reconnected. We will get it fixed. Why did we pick the taxpayer bill of rights as a topic?

DARRIN T. MISH: People don’t think they have any rights. We’re fresh off the filing season here and for some people, it was a stressful deal. For some people, it was no stress at all because they were either getting a refund and the returns are easy, or because they just don’t bother to file. You do have rights. There are things you need to know.

KATRINA MADEWELL: There should be.

DARRIN T. MISH: As a U.S. citizen, as an American, you need to know some of your rights. If we don’t know and enforce our rights, then we have politicians who are more than willing to take them away.

KATRINA MADEWELL: You are so right about that. Some of those are more controversial than others. When it comes to the taxpayer bill of rights, a lot of people probably don’t give it that much thought. They may not be as passionate about it as they may be for the second amendment.

THE RIGHT TO BE INFORMED

DARRIN T. MISH: Just like the bill of rights in the constitution, there are ten of them. The first is the right to be informed. I’m not going to say the IRS follows the taxpayer bill of rights. This is one I don’t think they follow very well at all. You have the right to be informed. Taxpayers have the right to know what they need to do to comply with the tax laws. Now, by a raise of hands, who out there thinks they know what they need to do to comply with the tax laws? Nobody’s raising their hand, I didn’t raise my hand. I don’t think it’s very clear in all cases, what we have to do to comply with tax laws.

KATRINA MADEWELL: Isn’t that the problem? You have people writing that and I think sometimes they leave it vague so attorneys can fight about it.

DARRIN T. MISH: Part of the problem we have is income tax passed in 1913, and ever since 1913 we’ve added and subtracted and added and added and added….So, we really have a system that’s cumbersome that nobody can easily comply with.

KATRINA MADEWELL: If you had a real estate contract and you added these addendums over time, eventually you don’t even know where you’re at.

DARRIN T. MISH: This is a stat I’ve heard that the tax code is so voluminous, that if you spent 8 hours a day, five days a week, reading the tax code, it would take you 80 years. Anybody who’ve said I’ve read the tax code from cover to cover…

KATRINA MADEWELL: You’ve skimmed through the tax code, there’s no way.

DARRIN T. MISH: Not possible. You can’t even start reading at that level until you’re ten or fifteen years old.

KATRINA MADEWELL: I don’t even know a kid that age that would want to read it.

DARRIN T. MISH: No, it’s just silly example.

KATRINA MADEWELL: But that’s the whole point, it’s not possible.

DARRIN T. MISH: You’re entitled to clear explanations of the laws and IRS procedures, all tax forms, instructions, publications, notices, and correspondence. You have the right to be informed of IRS decisions of your tax accounts and to receive clear explanations of the outcomes. I don’t think the IRS is complying with any of this.

KATRINA MADEWELL: What is the expectation? What do you see? The right to be informed, I’m sure you can argue what that timeline should be and the IRS probably has their own timeline. But what is that and what should it be?

DARRIN T. MISH: We have the right to be informed as taxpayers. The way the IRS interprets this…I don’t bash the IRS the entire show, but I’m about to bash them. They issue notices and letters that are just almost nonsensical. I do this all day, every single day, and I can, for the most part, understand what’s going on in a taxpayers account based on the correspondence they’ve received. But taxpayers can’t. There are two reasons. One is because the language is not clear or concise. The other reason is when you have a tax problem, you’re not thinking clearly. Not when it comes to that.

KATRINA MADEWELL: They’re informing them and sending them letters, it’s just that the letters are so full of IRS jargon that they don’t know how to follow them. Is that what you’re saying?

DARRIN T. MISH: They don’t even know what they mean. In lots of areas of our lives, they use a special vocabulary. Lawyers are famous for that. And Realtors too. We have a special vocabulary that we use and the IRS does too. Once you’re immersed in this world, you understand what the vocabulary means. But if you’re just a regular guy, you don’t speak that language. And it’s not your fault. You shouldn’t speak that language.

KATRINA MADEWELL: What’s realistic? Just whenever they feel like sending you a letter?

DARRIN T. MISH: For this point, this is an academic discussion. You have the right to be informed. It works better with one on one than it does taxpayer to IRS.

KATRINA MADEWELL: The next one is a real kicker. It’s the right to quality service. That’s fabulous. We’ll talk about this when we get back. 888-404-1010. We’ll be back in a minute.

(commercial break)

(Green Acres theme song playing)

PAT GEORGE: I just miss the farm talk. The planting season is here, it’s spring. Turtle crossing time.

KATRINA MADEWELL: We haven’t talked about farms or chickens.

PAT GEORGE: Talk about turtles laying eggs.

KATRINA MADEWELL: We have to talk about the taxpayer bill of rights today, Pat. That is on the agenda.

DARRIN T. MISH: Welcome back to the IRS Solution Attorney show. I am the IRS solution attorney, Darrin T. Mish.

PAT GEORGE: And a farmer.

KATRINA MADEWELL: I’m your cohost, Katrina Madewell, that’s Pat George, the crazy one back there on the board that always keeps this show alive. If you missed the earlier part of the show, we were discussing that you can get Darrin at 888-GET-MISH, that’s 888-438-6474. The first one you have is the right to be informed. That is so fun. If you missed it, check it on a podcast. You can hop on over to getirshelp.com or the irssolutionattorney.com and find Darrin Mish and all his prior shows.

DARRIN T. MISH: Don’t forget the podcast, or we also have the app. You can download the app from both stores, Google and Apple. All the shows are there. If you have a tax problem and you want to drink from a firehose, that’s the place to do it. I get calls on regular basis that say I was up all night listening or watching you. I watched seven hours of video because I couldn’t sleep. I thought I was GOOD at putting people to sleep.

YOU HAVE THE RIGHT TO QUALITY SERVICE

KATRINA MADEWELL: The second point, you have the right to quality service.

DARRIN T. MISH: They do call it the Internal Revenue “Service”.

KATRINA MADEWELL: When I look at the right to quality service, I want to ask them what does quality service mean to you?

DARRIN T. MISH: Quality service means something different to everyone. I’ll tell you a short story. There are little IRS offices all over the place. The St. Pete office is just a stone’s throw from here. It’s in the same sort of looking building as we’re in right now. There’s one in Tampa and Lakeland, all over. Every town of any size has an IRS office in it.

They used to be called taxpayer assistance centers because they would provide taxpayer assistance. A few years back, a memo came out from the Internal Revenue Service in D.C. and they said in the interest of providing better quality service, we decided to eliminate in-person service at our taxpayer assistance centers. How does that make any sense? How does that provide quality service to where you can’t walk-in and talk to somebody face-to-face? You have to call a toll-free number and wait on hold for hours.

You may get what they call a courtesy disconnect in the process. That means after you’ve waited on hold for a couple of hours, they decided you waited long enough and they terminate the call. And you can start all over.

Then you get these letters from the IRS that say you must call by a certain date. It’s usually a week or ten days. Then you can’t get through. That’s not quality service.

KATRINA MADEWELL: Who are some of the people you saw in those offices? They don’t even really have those anymore. They don’t take walk-in appointments, any of them, anymore. Do they?

DARRIN T. MISH: I don’t know that any of them do take walk-in appointments unless you have an appointment. For instance, your case is large enough that it’s been assigned to a revenue officer. The revenue officer says come down on Monday at 9 a.m.

KATRINA MADEWELL: But that’s not taxpayer assistance, which is what we’re talking about. Like I have some questions on my tax stuff, can you help me?

DARRIN T. MISH: No, they do not provide that, as far as I know. I think all taxpayer assistance, in terms of questions of tax returns are handled by the toll-free number. Or you have to pay for it.

KATRINA MADEWELL: I think the mortgage people probably ran them out. Florida is the high-fraud state. They have to get their signed, stamped transcripts. So, they would literally take their returns to the IRS and get them stamped so they could get them back to underwriting and close on time.

DARRIN T. MISH: In brief defense of the IRS, that service is still available because I did that last summer. I had a situation where I was going through a mortgage process to get the farm. We had to have them timestamped and all that.

KATRINA MADEWELL: I guess that means we didn’t run them off, that’s good.

DARRIN T. MISH: I didn’t need an appointment to do that, but I did have to talk my way past the two armed guards at the door. Those guys are alright, they’re just doing their job keeping the employees inside safe.

KATRINA MADEWELL: I had a lady once that was going through a divorce. It was a contingency on the contract because marital status affects title in the state of Florida. She got the divorce finalized and this was the last thing. She went to the IRS office and they said they couldn’t help her. She told them they don’t understand, she went through a divorce and did everything I’m supposed to do. I’m not leaving until someone helps me. She was adamant about it. She got what she went in for.

DARRIN T. MISH: I’m glad to hear she talked her way past them as well.

KATRINA MADEWELL: You can get some quality service, but you have to push for it.

DARRIN T. MISH: The rest of the description, right out of the taxpayer bill of rights…when it comes to the right of quality service. “Taxpayers have the right to receive, prompt, courteous and professional assistance in their dealings with the IRS. To be spoken to in a way they can easily understand. To receive clear and easily understandable communications from the IRS and to speak to a supervisor about inadequate service.”

I was handling the appeal of an offer in compromise within the past month. I’m dealing with a settlement officer, who is essentially the appeals officer handling the case who was ultimately making the decision. She was being rude and unprofessional. This is not common at the level of employee at all. She was saying things like, you lose, I don’t even know why we’re talking about it, you lose. She was being nasty. I was not participating in that, even though it was really tempting to escalate it and be ruder than she was. As that moment was running through my head I knew it might feel good temporarily but in the long run, it’s going to be bad.

I very calmly asked to speak to her supervisor. You have the right to. She was nasty as I was asking for the supervisor’s name and number. I wasn’t even being nasty about it. I told her that we weren’t communicating and I just wanted to talk to someone else that might understand where I’m coming from. If the decision is final, the decision is final.

She called back within an hour and said the supervisor indicated to her to deal with me and that my argument had some weight. We ultimately won that case. The point of that story is, what do you think the odds are of Joe Blow regular guy in that situation prevailing? It was even intimidated to me, not that she was scaring me, but I didn’t think I was going to win. I was absolutely right, my theory was spot on, exactly correct, and here was someone who had a training issue and decided being unprofessional was the way to go. She could just have been having a bad day.

The irony is I have another case coming up with that same person. The good thing about that is I didn’t hit her with a barrage of negativity back. I’m not taking this personally.

KATRINA MADEWELL: Your business could be a lot like ours where you get a lot of stubborn people. Sometimes that can be a fight. You never know when you’re going to run into that person again.

DARRIN T. MISH: Lawyers don’t always realize this. I told this to a revenue officer recently. I’ve been in this town for 20 years practicing law. 18 of the years doing IRS work. I’m going to be here another 20, easy. So, I’m not going to go around burning bridges, if I can help it. There are some that you just have to do it. One particular revenue officer lied to me. Straight up lied to my face, levied a client’s bank account over $1500 when he said he wasn’t going to do it. We were prepared to write the check, and that really upset me. I made sure the revenue officer knew where I was coming from. From now on, you and I, every case we have together is going to be hard.

KATRINA MADEWELL: He didn’t do what he said he was going to do. That’s just integrity at any level.

DARRIN T. MISH: I probably said too much on that.

KATRINA MADEWELL: You can experience that anywhere in life. I think anyone can agree with that.

THE RIGHT TO PAY NO MORE THAN THE CORRECT AMOUNT OF TAX

DARRIN T. MISH: The third one is the right to pay no more than the correct amount of tax. Taxpayers have the right to pay only the amount of tax legally due, including interest and penalties, and to have the IRS apply all of the tax payments properly. This is another thing we have problems with, isn’t it?

KATRINA MADEWELL: They can’t go to someone like Darrin and say, you know too much about this stuff, and we want you to pay more in taxes.

DARRIN T. MISH: No, goodness, let’s hope not!

KATRINA MADEWELL: I’m just teasing.

DARRIN T. MISH: I think where we have problems with the right to pay more than the correct amount of tax, the correct amount of tax is a nebulous concept. When it takes you 80 years to read the tax code, whose opinion of the correct amount of tax are we talking about?

KATRINA MADEWELL: Here’s the thing, it’s just like attorneys and CPA’s. You can go to one or another and get a different opinion. Especially when the tax code is 80 pages. There’s a possibility that the CPA can say, yeah you can write this off and another says, no, that plan is too aggressive.

DARRIN T. MISH: There’s a study where 50 CPA, tax preparers, took the same fact pattern, where it was medium in complexity and were asked to prepare a tax return, and they got 50 different answers. How is that a system that makes any sense? It’s irrational.

KATRINA MADEWELL: That’s the point, it’s pretty vague. It just says the right to pay no more than the correct amount of tax. That’s arguable.

DARRIN T. MISH: We’re going to argue about that in the contexts of audits a lot, aren’t we?

KATRINA MADEWELL: Yes, without a doubt. The fourth one is the right to challenge the IRS’s position and be heard. I think this is probably your favorite one on the whole list.

You can get Darrin at 888-GET-MISH, that’s his off-air number. 888-GET-MISH. We’ll be back in just a minute.

(commercial break)

DARRIN T. MISH: Welcome back to the IRS Solution Attorney show. I am the IRS Solution Attorney.

KATRINA MADEWELL: Mr. Darrin T. Mish. I’m your cohost, Katrina Madewell. Were you going to spit that out? Just want to make sure people know how to get you. 888-GET-MISH.

DARRIN T. MISH: We have so many technological challenges today, I have divided attention.

KATRINA MADEWELL: He’s so distracted today.

DARRIN T. MISH: Today we’re talking about the taxpayer’s bill of rights.

KATRINA MADEWELL: Did you just say tax-bayer?

DARRIN T. MISH: Well, if you have a tax problem, you definitely need some Bayer aspirin.

KATRINA MADEWELL: Yes. Just to run through these, the right to be informed, the right to quality service, the right to pay no more than the correct amount, and number four…I’m sure you can’t wait to talk about this one, Darrin….

THE RIGHT TO CHALLENGE THE IRS POSITION AND TO BE HEARD

DARRIN T. MISH: It’s the right to challenge the IRS position and to be heard. A lot of people don’t take advantage of this. They think, well, the IRS says I owe “x” amount of money, I disagree, I think it’s terrible, but I don’t know what to do about it.

KATRINA MADEWELL: Read a part of it and talk about what it means. Interpret it in lay terms.

DARRIN T. MISH: Taxpayers have the right to raise objections and provide additional documentation in response to formal proposed IRS actions to expect that the IRS will consider their timely objections and documentation promptly and fairly and to receive a response if the IRS does not agree with their position.

Because we’re talking about the taxpayer’s bill of rights, this show has been a bit of an IRS bashing session. We don’t do that a whole lot, but they’re not doing a great job of this.

KATRINA MADEWELL: It says the right to be heard. They just consider that as written correspondence?

DARRIN T. MISH: In some instances. If you have a revenue officer, you’re going to be heard. He’s not going to hear a lot of what you say. I’ll give you an example. In the context of having a revenue officer, a taxpayer will be compliant, they’re current, they have no missing returns, the provided financials and their financials show an ability to pay some amount.

The taxpayer says, I’m tired of dealing with you, no offense Mr. Revenue officer, but I just want to get into an installment agreement and put this behind me. If I’m in an installment agreement, and I’m staying current, then eventually this will be over. When you formally request an installment agreement, the IRS must formally accept it or reject it. If they reject it, you have the right to appeal it.

KATRINA MADEWELL: Do they kind of drag things out?

DARRIN T. MISH: There are some revenue officers in this area, I hope they’re listening. They don’t know when to stop asking questions. It’s not like they’re uncovering the big secret. There is no big secret. These are just regular folks who are just trying to run a business, trying to employ people. Maybe they do owe $200,000, but there’s eight years left on the collection statute of limitations, so there are eight years left to collect the money, it’s $200,000, we want to pay $3,000 or $4,000 a month, there’s plenty of evidence that they can do that, but not a lot more than that. They just want to keep asking questions. It’s a bit frustrating for the taxpayer, I’m sure. It’s frustrating for me.

KATRINA MADEWELL: If they’re willing to cooperate and pay it, I just don’t know why it’s such a big issue. Especially when they’re saying they’re so bogged down with this kind of stuff.

DARRIN T. MISH: The mentality of a government employee is sort of interesting. I’m not going to go too far into that.

KATRINA MADEWELL: Please do. My husband works for the government, and he’s listening.

DARRIN T. MISH: We have evidence that Chris is listening. Years ago, I was a public defender for a couple of years. Big shout out to the PD’s out there. Hardest job in the law. Bar none. The clients hate you, the judges hate you, the state attorneys hate you, everyone hates you. It’s a hard job. A lot of time government employees either don’t want to do any work at all, they’ve been there forever and are burned out, biding their time. Or, they think their job is the most important function in the government. Without them, we cannot soldier on.

I think the correct balance is somewhere right in the middle of that. Do the work, but you’re not the cog, if it’s missing, the government comes crashing down. Just follow the rules, be a human and it will all work out better.

So, yeah, you have the right to challenge an IRS position on things. For the most part, when I deal with taxpayers who owe money to the IRS, we do lots of appeals. Almost everything the IRS does, can be appealed at some level. I don’t have a lot of time to go into that. We’ve done whole shows on appeals.

You have to pay attention to your mail. If you’re a taxpayer and you’re getting mail from the IRS, do not throw it on the table and leave it unopened. If it comes certified, I’m pleading with you, I’m imploring with you, open the mail. There are things coming certified to you with deadlines that really can’t be fixed.

KATRINA MADEWELL: I just got a letter from the IRS and I barely looked at it. I meant to bring it with me so you could look at it. It was something simple like, hey we changed your address.

DARRIN T. MISH: Back up to the right to be informed, or the right for quality service, to be communicated with in a clear, concise manner. You’re a very smart, educated person, lots of business experience and you get this letter and you’re like, I don’t even know what that means.

KATRINA MADEWELL: I don’t even want to read it.

DARRIN T. MISH: That’s a perfect example. Nobody wants to read the mail from the IRS. But I’m telling you, open it! Open it! The scarier it is, the more likely it is you should call me at 888-GET-MISH. That’s 888-438-6474.

KATRINA MADEWELL: That’s a pretty good point. What does number six mean? The right to finality?

DARRIN T. MISH: Let’s back up to number five, you have the right to appeal an IRS decision.

KATRINA MADEWELL: I thought you didn’t want to talk about appeals.

DARRIN T. MISH: We can talk about appeals, I just meant we weren’t going to talk about it for 15 minutes. Taxpayers are entitled to a fair and impartial administrative appeal of most IRS decisions, including many penalties and have the right to receive a written response regarding the office of appeals decision. Taxpayers generally have the right to take their case to court. I don’t know about that last part.

KATRINA MADEWELL: Has that really ever happened?

DARRIN T. MISH: Yeah, only in the assessment context. If you’ve been audited, you can appeal the audit, if you disagree with the appeal of the audit, you can go to tax court. Yes, you have that right. However, let’s say you do an offer in compromise, you try to make a deal to settle for less with the IRS, by and large, once it’s rejected and it goes to the office of appeals, you don’t have the right to go to court. It just stops at appeals.

The thing that’s interesting is the office of IRS appeals is allegedly independent. That’s sort of nonsensical. They definitely work for the internal revenue service, in internal revenue service buildings, with internal revenue service business cards, paychecks. Settlement officers, who are the appeals officers who handle collection appeals, which is where I spend most of my time. Which means the taxpayers arguably owe the money and the taxpayer can’t afford to pay it, or doesn’t want to pay it. Those settlement officers come from the field. They come from revenue officers.

KATRINA MADEWELL: So, it’s a promotion?

DARRIN T. MISH: Yeah, it’s a promotion. I recently heard, or found out, there’s no college degree requirement to become a settlement officer.

KATRINA MADEWELL: Isn’t that fun?
DARRIN T. MISH: That’s a little scary. I’m not putting anybody down here. A college degree is not necessarily the end all, be all. A lot of people I know don’t have college diplomas, and they’re millionaires.

KATRINA MADEWELL: But you just don’t know who you’re arguing with on the other side that’s working for the IRS.

DARRIN T. MISH: That’s the challenge. How do you communicate with them if there’s not some sort of baseline of knowledge that’s presumed?

KATRINA MADEWELL: Is there a certain time period they have to do that?
DARRIN T. MISH: Yeah, I’m sure, there’s a certain number of years of service. Ironically, the woman who told me she doesn’t have a college degree was one of the best settlement officers I’ve ever worked with. So, it’s not a correlation, I just thought I’d mention it. It’s interesting that these people are making, not really life and death decisions…

KATRINA MADEWELL: She’s probably doing better than the ones with the college degree.

DARRIN T. MISH: She’s out in Fresno, CA, and I pretty much offered her a job. I asked her how long before she retired, and she said 4 or 5 years. I told her to write my name and number down and to call me for a job when that time comes.

KATRINA MADEWELL: She might.

DARRIN T. MISH: I hope she does. She needs to come over from the dark side, come over into the side of light and glory. And help people for a change.

KATRINA MADEWELL: So, you said they can appeal it in tax court. Where is tax court?

DARRIN T. MISH: That’s a good question. Matt, if you’re listening, we need to do a show on tax court. Tax court is interesting, there’s not a tax court building. Everybody kind of thinks they have to go to D.C. to go to tax court. We assume there’s a building D.C. Tax court is a traveling circuit court. They hold court at various federal courthouses throughout the country.

KATRINA MADEWELL: So, they travel?

DARRIN T. MISH: Those poor guys, they’re on the road all the time. They’ll come to Tampa maybe twice a year. They’ll have a docket on a Monday morning and that docket will have 300 cases, 500 cases, something like that. And they’re expected to try…they’re here for a week. And they’re expected to try that entire docket. They’re expected to “dispose” of that entire docket during that money morning session, plus the other four days.

It’s just like setting a criminal case for trial. If you’re a criminal defense lawyer, you set a case for trial, you show up on Monday morning. What happens is the circuit court judge, in this case, would have 400 cases sent for trial. That’s his week. What happens is, that’s when all the deals get cut. That’s the bottom line.

There’s artificial time pressure, there’s pressure on both sides. That’s when the deals get cut. Same thing happens in tax court.

KATRINA MADEWELL: So, 300 cases might get knocked down to what?

DARRIN T. MISH: 3 or 5. Maybe they can do 4 days’ worth of half day trials.

KATRINA MADEWELL: So, the judge and attorneys that travel in tax court, I imagine the local and state laws don’t matter, they’re following federal tax laws?

DARRIN T. MISH: For the most part, tax matters are matters of federal law, so state and local law won’t come into account. They’re not trying these cases in state courthouses, they’re trying them in federal courthouses. There’s a federal courthouse in downtown Tampa.

KATRINA MADEWELL: Ok, keep going, we’re going to run out of time.

YOU HAVE THE RIGHT TO FINALITY

DARRIN T. MISH: You have the right to finality. Taxpayers have the right to know the maximum amount of time they have to challenge the IRS’s position as well as the maximum amount of time, as well as the maximum amount of time the IRS has to audit a particular tax year or collect a tax debt. Taxpayers have the right to know when the IRS has finished an audit. Ok, not followed, not typically.

KATRINA MADEWELL: How long does it take them to finish an audit?

DARRIN T. MISH: They have a right to know this stuff. It’s not routinely indicated to anybody.

KATRINA MADEWELL: This is some of the things you would fight? If they haven’t sent correspondence like they should communicate what’s going on, then you challenge this bill of rights?

DARRIN T. MISH: It’s just like in real life. How often are you going to win an argument? That’s against the first amendment! It’s not how it works. When we come back, we’re going to try and get through the last four. We have a pretty cool train wreck of the week.

KATRINA MADEWELL: Alright, if you want to get Darrin, you can catch him on his off-air number, which is 888-GET-MISH.

DARRIN T. MISH: That’s 888-438-6474. Visit the website at getirshelp.com.

KATRINA MADEWELL: If you have a question, it would probably be best to call back there and talk to Pat George today and we’ll try and squeeze it in. 888-404-1010. Pat’s back there to take your call live and answer your question you have on the air. Darrin’s ready to shoot me because we have so much content, but we can do it. We’ll be back, you’re listening to the IRS Solution Attorney, back in a minute.

(commercial break)

(Van Halen’s “Jump” intro music)

PAT GEORGE: I figured I’d better play one that Katrina would know.

KATRINA MADEWELL: I do know this song.

PAT GEORGE: I know you do. Gotta jump right back into here, huh?

KATRINA MADEWELL: This was David Lee Roth, before Sammy Hagar.

DARRIN T. MISH: Welcome back to the IRS Solution Show, I am the IRS Solution Attorney, Darrin T. Mish.

KATRINA MADEWELL: I’m your cohost, Katrina Madewell. My version of Van Halen, was more Sammy Hagar.

PAT GEORGE: I didn’t know you were that old.

DARRIN T. MISH: That’s like saying she likes New Coke over old Coke.

KATRINA MADEWELL: Well, the old Coke used to have “coke” in it. That’s before my time.

DARRIN T. MISH: I wasn’t talking old, old Coke. Today we’re talking about the taxpayer bill of rights. We’ve gone through the first six. Since we have about 3 1/2 minutes to get through the other four, we’re going to go real fast.

THE RIGHT TO PRIVACY

Number seven is the right to privacy. Basically, taxpayers have the right to expect that any IRS inquiry or IRS action will comply with the law and be no more intrusive than necessary.

KATRINA MADEWELL: So, they can’t say anything to anyone that would call?

THE RIGHT TO CONFIDENTIALITY

DARRIN T. MISH: That falls into the next one, which is number eight. The right to confidentiality. The IRS cannot just blab anything that’s taxpayer confidential information. Remember when Donald Trump’s tax return was leaked? If that had been by an IRS employee, and it may have been, we don’t know, then that would be a violation of a criminal statute and that person should and could go to prison. That’s one of the things I think is good about our system are IRS employees are usually very good about keeping taxpayer’s confidential information confidential.

That’s one of the seven deadly sins, another show topic. The seven deadly sins that IRS employees can commit to lose their jobs and/or go to prison.

RIGHT TO RETAIN REPRESENTATION

Number nine, is the right to retain representation. One that is near and dear to my heart, you have the right to have counsel, you have the right to have an accountant, you have the right to have a representative represent you before the IRS. It’s kind of obvious. Like, duh, you have the right to a tax attorney. But, no, it means more than that. You have the right to spend money on the representation in a priority over the IRS.

KATRINA MADEWELL: So, they can’t say, you can’t pay an attorney because you owe us taxes?

DARRIN T. MISH: Exactly, and if they did, would you have any right to representation at all? They could always say, you owe us money and unless you have enough money to pay us and the lawyer, you don’t get the lawyer.

PAT GEORGE: If we have that right, who do we call?

DARRIN T. MISH: You would call 888-GET-MISH. The Law Offices of Darrin T. Mish, P.A.

THE RIGHT TO A FAIR AND JUST TAX SYSTEM

KATRINA MADEWELL: Yeah, that. Number 10 is the right to a fair and just tax system.

DARRIN T. MISH: Let me read you the description. Taxpayers have the right to expect the tax system to consider facts and circumstances that might affect their situation. Does it happen? Not as well as it should. I think the IRS has a lot to work on regarding complying with the taxpayer bill of rights, and I hope they do.

KATRINA MADEWELL: That was all of the above, wasn’t it? We have a tax question. Alan wants to know; does he need to file an extension if he has a refund coming.

DARRIN T. MISH: No, he doesn’t. The real reason to file an extension is to prevent the late filing penalty, and if you have a refund coming then you don’t have a late filing penalty. Even if you file it very late. Remember, though, if you have a refund coming, you must file within 3 years, or you forfeit the refund or any credit toward the refund. That’s sort of your timeline there. It can be kind of hairy-scary, though. You have to be pretty sure you have a refund coming. If you owe a little bit of money, you’re going to have a big penalty.

DARRIN T. MISH: It’s about that time, it’s time for the IRS Train Wreck of the Week. This is my favorite segment of the show. It’s where somebody came into the office and their situation was pretty much a train wreck. They owed a lot of money to the IRS and after we worked on their case, they came out smelling like a rose.

I just dealt with this gentleman yesterday. I represented him a number of years ago. He owed about $396,897 to the IRS. So just shy of under $400,000. It had been a very long time coming. I think it was over a period of eight years or so. He was just on one of these treadmills where he was making money, but not enough money and he was racking up big tax debt every single month. He really didn’t know what to do. The IRS was on his back, there was a revenue officer. They were getting ready to seize stuff and really make his life miserable.

At the same time, to add insult to injury, this poor guy was going through serious health conditions. I can’t remember what it was, but it was debilitating, then he had a debilitating back problem too. It made it pretty much impossible for him to go work the way he had been. So we filed an offer in compromise, which is where you make a deal to settle for less, or at least you’re proposing to make a deal to settle for less. We really low-balled the IRS bad. I don’t remember the exact amount we offered.

Say, $500 on 400 grand. It was rejected. The IRS came back, and they said this is a full pay. We used the IRS office of appeals and we appealed that decision on the rejected offer in compromise. Ultimately, we got that thing settled for $1221. It was really hard fought. It took a couple of years. I can remember this client when it came time to appeal, I remember him reaching out to me and saying Darrin, this is my last hope. You have to come through for me, man. Rest assured, I’m going to do my absolute best. When someone really says that, you’re like, wow.

It’s really kind of heavy when someone puts that much trust in you. We worked hard on it. We could demonstrate his inability to pay, but also the other physical problems with him, and we got it settled for $1221. $1221 on 400 grand is a pretty good deal. The IRS has another taxpayer back in the system, and he’s happy.

KATRINA MADEWELL: So, if you or someone you know has a tax problem or question, I would encourage you to call Darrin’s office. Heather is there, the phone lines are open, she let us know. 888-GET-MISH.

DARRIN T. MISH: That’s 888-438-6474. Visit our website if you need just a little more information at getirshelp.com. You can listen to our podcast, the IRS Solution Attorney, download the app. That would be my favorite thing you could do, short of a phone call. Listen to us on the radio maybe in your car on your commute, and you can learn a little bit about how we operate.

KATRINA MADEWELL: Thursdays at 9 am Eastern, we’re always here, and we are streaming online. It looks like somebody had a question. They got hit with some IRS fraud, where they swiped the tax refund. We have talked about this before, and it’s a hard thing, low on the priority list. It’s a crazy thing, you must file it with the FBI. And the IRS gets involved.

DARRIN T. MISH: We’ll answer that question on Facebook. If you’re listening to this show or you want to listen to this show, 9 am Eastern, 1010am, or you can visit us on Facebook live with the IRS Solution Attorney.

KATRINA MADEWELL: Call Darrin at 888-GET-MISH.

DARRIN T. MISH: 888-438-6474

KATRINA MADEWELL: Thanks for joining us this week.

DARRIN T. MISH: For today, we’re out.

PAT GEORGE: More farm talk next week.

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