Treasury Secretary Janet Yellen announced that between the fall of 2023 and September of 2024, the IRS collected over $1.3 billion in additional revenue from high-earning tax avoiders.
In large part, this success is due to recent changes in 2024 IRS revenue officer guidelines, increased enforcement, and a bigger budget for the IRS.
While that’s good news for the IRS, it can feel a bit scary to people who owe taxes. If you’re behind on your business or individual IRS taxes, the agency may assign a revenue officer to your case—it’s their professional assignment to collect your taxes. To help you out, this guide explains what to expect, and it looks at new updates in IRS processes for 2024.
If you’ve recently received IRS notice 725-B or similar collection notices that mention a revenue officer being involved in your tax case, then it’s important to quickly get informed about your rights and options. Recent changes to the way the IRS handles collection enforcement actions may impact you. Learn everything you need to know to navigate the situation effectively below.
Important 2024 IRS Policy Changes
In 2024, the IRS implemented several new changes to existing policies and procedures. Many of these initiatives were encoded into law when the Inflation Reduction Act was passed. Other changes were implemented as part of the IRS Strategic Operating Plan for 2024.
The goals of these important IRS policy changes include:
- Improving the effectiveness of collection efforts
- Enhancing IRS revenue officer and taxpayer safety
- Increasing how much is recovered during collections
- Ensuring tax compliance
- Pursuing a more digital-based tax system
- Simplifying notices to make them easier to understand
- Reducing the need for live assistance for 2025
- Modernizing and improving old systems and processes
Here are a few of the major changes that will help the IRS pursue these goals:
Unannounced Visits Will Cease
One of the biggest changes the IRS is making for 2024 is ending unannounced revenue officer home visits. In the past, revenue officers would regularly show up at a taxpayer’s home when they owed a hefty debt to the agency, but this process was highly dangerous for both officers and taxpayers.
Now, except for a few exceptions, the IRS will not show up to your door unexpectedly. Instead, you should receive a 725-B Notice requesting an appointment time to meet up with your revenue officer. This gives taxpayers more time to prepare for meetings.
The IRS Will Shift Focus to High-Income Cases and Larger Tax Debts
Another important change is that the IRS will shift its focus onto high-income taxes that have large tax debts. In February of 2024, the agency specifically went after 125,000 overdue accounts from high-earning individuals who hadn’t filed taxes since 2017. During the first six months of initiating this program, over 21,000 of those individuals have already filed their taxes and paid around $172 million.
Even earlier than that, the Inflation Reduction Act created an initiative in 2023 to focus on high-income individuals who haven’t paid their tax debt and owe over $250,000. Prior to the act, the IRS claimed they couldn’t track down the money due to a lack of resources, but now, thanks to the added funding, almost 80% of these millionaires with overdue tax debt have started making payments to the IRS. An estimated $1.1 billion has been recovered under this new initiative alone.
Increased Enforcement and Enhanced Staffing
The IRS is also seeking to increase its enforcement efforts by adding more IRS agents. In 2023, the agency hired 3,700 employees across the country. These employees are meant to help the IRS with enforcement and compliance efforts. Specifically, these agents will be tasked with targeting high-income earners, large corporations, partnerships, and promoters.
Note that there are several different types of IRS employees including revenue officers and agents. The main difference between revenue officers vs. agents is that agents audit returns and officers collect taxes, but there are other specifics.
Key IRS Notices Leading to Revenue Officer Involvement
Getting informed that your tax debt case is being handed over to a local revenue officer can feel quite intimidating. This is especially true in light of the key changes in 2024 that are strengthening the IRS and helping them enforce collection efforts even more effectively.
The good news is that you should never have a revenue officer assigned to you unexpectedly. The IRS will attempt to send you several letters first about your tax balance, the delinquency status of your account, penalties that have been levied against you, and more. Eventually, your case will escalate to the point where an officer is assigned to attempt to collect from you.
Here are a few key IRS notices that indicate you’re about to have a revenue officer involved in your situation.
IRS Notice 725-B: Personal Assignment of a Revenue Officer
IRS Notice 725-B will be sent to you when you have an unpaid tax balance, and a revenue officer has been assigned to your case. This letter informs you that the IRS has set a date, time, and location for you to meet with the revenue officer. This meeting place could be your business, an IRS office, or simply a scheduled telephone call.
You need to prepare for the meeting and attend it. If you don’t, then the IRS will escalate their collection efforts.
Form 9297: Summary of Taxpayer Contact
When you receive a notice that your case has been assigned to a revenue officer, you may also receive Form 9297. This form requests details about your finances. Ultimately, the IRS will use this information to identify how you should pay your tax bill.
CP504: Intent to Levy Unless Immediate Action is Taken
IRS notice CP504 will be mailed out to you if owe the IRS a balance and they have not received a payment. This letter explains the IRS’s intent to levy your account if you do not pay the full amount that you owe immediately.
The levy could apply to your bank accounts, property rights, or other assets. It’s crucial that you take action or speak to a tax attorney. If you don’t, then expect the levy to go through, putting your financial accounts and property at risk of seizure.
Generally, the IRS’s automated collection system (ACS) sends out this notice, but by the time your account escalates to this point, the assignment of a revenue officer is imminent.
LT11: Final Notice Before Levies or Garnishments
Taxpayers can expect to receive IRS LT11 when they owe the IRS an overdue balance, and the IRS intends to seize property or property rights to resolve the debt. Taxpayers need to pay off the full amount they owe as soon as possible to prevent the levy or garnishment from manifesting.
CP523: Defaulted Installment Agreement and Resumed Enforcement
CP523 means that the IRS intends to end your installment agreement and move forward with seizing your assets. This notice means that you defaulted on your agreement with the IRS. You may have missed a payment, paid late, or taken some other action that invalidated the agreement you had with the IRS.
If you don’t rectify the plan by catching up on your monthly payments by the deadline on the notice, you will owe the balance in full. And the IRS may assign a revenue officer to collect it.
Steps to Take When Contacted by a Revenue Officer
Before your revenue officer makes contact with you, you will likely receive an IRS notice. Your first step is to respond promptly to the notice. This might involve calling the revenue officer to verify your appointment.
If the IRS requires a specific action, like paying off what you owe, then it might be best to consult with a tax attorney for professional representation before you take your next steps.
Another step you may want to take before deciding how to navigate your tax debt is preparing your financial records and tax documents in advance. Getting your documents together will help you better understand your situation, how much you owe, and your ability to pay. It will also put you in a better position to negotiate with the IRS. Your attorney can take the lead on this process if you decide to hire one.
How a Tax Attorney Can Help
A tax resolution attorney can help you navigate your tax debt in a way that benefits you the most. In most situations, the IRS isn’t out to simply take your property or wages. They just want to recover the money they are owed.
Having a tax attorney advocate for you can prevent property seizure, wage garnishment, and bank levies because your attorney can typically negotiate a better deal for you. Your attorney can help you identify options like applying for penalty abatement, seeking innocent spousal relief, or filing for currently non-collectible status.
A lawyer can also be very beneficial if you’re facing a complex tax situation.
What to Expect from a Revenue Officer
With the latest changes in IRS initiatives for 2024, you can expect more aggressive collection efforts this year. If you already have a revenue officer assigned to your case, then you should expect more contact and a bigger push for you to pay what you owe. Stay aware of the latest tips for dealing with a revenue officer to ensure that your meetings go well.
The good news is that you won’t have to worry about your revenue officer showing up to your home or business unexpectedly. The IRS’s new process involves scheduled visits.
Consequences of Ignoring IRS Notices
Ignoring an IRS notice never works in your favor, especially if that notice specifically states that it requires action on your part. When you don’t comply with the instructions in the letter, you could miss your chance to negotiate a better deal or end up facing unwanted collection actions.
The IRS is much more likely to work with you in good faith if you respond promptly, even if you can’t pay off what you owe right away.
A failure to respond will also result in escalated enforcement actions. If you’re not sure how to respond, then it’s time to contact a tax attorney. The right tax resolution professional will walk you through your options.
Need More Guidance? Talk to a Tax Resolution Attorney Today
Have you recently received IRS Notice 725-B or a similar collection letter from the IRS in the mail? If so, then you need to take action to preserve your rights and protect your best interests. You need to balance out the IRS’s need for a timely response with your need to get informed about your situation, too, though.
Typically, your best option in this type of situation is to speak with a tax resolution attorney. A quality tax lawyer will utilize their existing knowledge of tax law, IRS collection rules, and the tax relief options available to help you make an informed decision on how to move forward with your tax debt.
Here at Damiens Law Firm, we can assist you in developing a plan of action when it comes to managing your tax debt, handling any appointments with a revenue officer, and understanding your tax debt relief options.
Schedule a free, brief discovery call with our team now to find out if our services are right for you.
