28 Apr 2020 IRS Pauses Collections in Response to the Coronavirus
In an attempt to alleviate some of the economic pressure created by COVID-19, the government has begun to pause collection activities for some taxpayers.
The suspension period will run from April 1, 2020- July 15, 2020, but interest will continue to accrue at a rate of 5 percent per year. In many cases, an additional charge for late payment of .25 to .5 percent per month will also be added to the balance.
For cases in a direct debit installment agreement, taxpayers should contact their bank to request stopping payments. For those in this situation that experience permanent economic change, renegotiating installment agreements may be necessary.
For taxpayers who have been a target of IRS collection but are not yet in an installment plan, the IRS is suspending garnishment, seizures or property, civil suit proceedings and lien filings through July 15, 2020. This suspension period should be used to gather documentation and prepare a financial disclosure package to secure a collection alternative, when collections resume.
The primary cases where this suspension may not apply are:
- If there is a risk of permanent loss to the government due to the expiration of a statute or other exigent circumstance
- If the taxpayer has agreed to an action
With the uniqueness of each taxpayers situation government front line employees are exercising sensitivity to each individual circumstance and providing appropriate relief.
To see the full article from our friends at Accounting Today.