Law360: 5 Ways Tax Pros Want IRS To Respond To COVID-19

Eversheds Sutherland attorney Ken Jones is quoted in this Law360 article discussing why the Internal Revenue Service (IRS) should consider extending deadlines related to examinations and appeals and explore suspending automatic collections because people may not be able to respond to deadlines or make payments if they are sick due to COVID-19.

Ken said that major law firms and accounting firms are telling people not to come into work, but is unclear whether they have extensions on examination and appeals deadlines, or what happens if a client has an installment payment plan but fails to make a payment.

Under IRC Section 6502 , the IRS has 10 years to collect tax after it has been assessed, which means there is some leeway in when the government decides to collect levies, he said.

But deadlines for examination or appeals are administrative decisions, so the IRS could just decide to automatically extend a deadline if the agency chooses to, which would be helpful if offices are closed, he added.

Automatic collection also needs to be addressed because if someone does not make a payment the IRS could automatically file a lien against someone or a business, which may not be operating because of the virus.

“It may make sense," Ken said, "to take some sort of action now rather than having thousands and thousands of situations with this crisis where people have to go to their accountant or lawyer and say: ‘Help me. The IRS is now imposing penalties, they filed a lien on my business and I’m going to go out of business.’”