Enrolled agent urges caution at upcoming IRS problem-solving day

A former Internal Revenue Service officer warns Missourians that the IRS's "problem-solving day" set June 16 in Kansas City is a "ploy" to entrap unwary taxpayers and accelerate IRS collections.

The IRS says it's just trying to improve service to taxpayers.

However, Mark W. Sullivan of Clayton, an enrolled agent who represents taxpayers before the U.S. Tax Courts and Treasury Department, advises taxpayers that "prudence demands caution" and to approach the IRS warily at the problem-solving day, especially if you have a dispute.

Not an amnesty program

Many people think the problem-solving day is an amnesty program like some states have, Sullivan said, but it's not.

"The IRS uses this day to lure taxpayers into making damaging admissions, perhaps even to criminal law violations without the taxpayer's representation by counsel," said Sullivan, who was an IRS agent for six years.

The IRS, in its press release on the subject, states that the problem-solving day is part of its "continuing effort to raise its standard of service to taxpayers." At each of the 56 session across the country, from 9 a.m. to 3 p.m., "individual taxpayers can sit down and discuss tax problems with IRS experts. IRS decisions-makers will be at each location to help iron out taxpayer problems."

That's fine, if the problem is finding out where your tax refund check is, but not so fine if you haven't filed your taxes, Sullivan said, or if you owe substantial back taxes.

Sullivan said the 4-million-word Tax Code has no special exemptions for problem-solving day, nor do the agents receive any special training for the problem solving day.

Tax law is confusing and complicated. The new code has 441 changes this year, Sullivan said, and more than 7,000 changes since the major renovation of the code in 1986.

"I have represented clients who suddenly became the focus of intense IRS scrutiny, all because they attended an IRS problem-solving day,'" Sullivan said.

What happens is the IRS "takes someone's good intention of coming in and trying to work out an issue then giving it a fast track status to a field agent who is quickly going to move toward taking aggressive enforcement action," Sullivan said.

He added that he represents one client who voluntarily filed his tax returns late and the IRS charged him criminally because he filed late.

Because the problem-solving day concerns civil law, there is no requirement for a Miranda warning against self-incrimination, Sullivan said.

Legal counsel

He "strongly recommends" that a person in a dispute with the IRS retain legal counsel first "because anything (they) say can be used against them."

Immunity isn't granted just because "the taxpayer ... willingly comes forward and bares his soul before the IRS," he said. "This ... is designed to swell collections of delinquent taxes by eliciting damaging admissions and documents from taxpayers under the guise of assisting them. I find the practice abhorrent and a vestige of the old guard at IRS."

Sullivan said the IRS has offered the problem-solving days for about four years. "The original concept was to come in and the IRS be kinder and gentler ... in a peaceful atmosphere."

But, he added, the translation from the national to the district office has clouded a bit, and what is supposed to be a chance to come in and speak at ease with the service has turned into an opportunity for the service to draw in ... those they haven't been able to contact before."

As an enrolled agent, Sullivan is licensed by the United States Treasury to practice tax law before the IRS throughout the country.

IRS has helped thousands

However, while Sullivan is dubious of the process, Janice Lawrence of St. Louis, an IRS media specialist for Missouri and Kansas, responded that 60,000 people have been helped during problem-solving days since they were instituted.

"We try to give people the opportunity to meet somebody face-to-face from the IRS and to talk with them about what their problems are," she said.

The IRS wants taxpayers to know that "every day is a problem-solving day at the IRS." She added that taxpayers aren't prohibited from bringing in a legal representative with them and agreed that violating federal law has consequences.

"This is not an effort to entrap or get people; to get them in and do anything that would be negative," Lawrence added.

The topics discussed are "almost anything." For the non-filing taxpayer, who didn't file because of divorce or death when filing is due, for instance, "they're afraid and it kind of snowballs on them." It continues to "bother them," she said. Many people come into problem-solving day and go away with their taxes filed, she added.

Major issues

About seven major issues recur on problem-solving day, Lawrence said. About 13 percent of inquiries are about audits, 10 percent are offers in compromise, 7 percent requests for technical or procedural explanations, 7 percent installment agreements, 6 percent account notice inquiries and 5 percent inability to pay. The balance of the 46 percent "covers anything you can imagine that's tax related," Lawrence said.

Because the June 16 problem-solving day is on a Saturday, many taxpayers come in because they can't get to the IRS office during the week. "That's a big issue for many," she said.

From January to April 15, the IRS offers extended office hours. A toll-free number is available 24-7, she said, at 1-800-829-1040. The IRS Web sits is www.irs.gov.

Springfield has an IRS walk-in office in the Empire Bank Building at National and Walnut Lawn.

"If people have a problem, they need to come in and talk it over and find out the information. That's the best place to go to get the information you need," Lawrence said.