Congress got something right.
In the course of enacting the Tax Cuts and Jobs Act, Pub. L. 115-97, the Senate added a provision addressing a recurring problem by extending the time to file a wrongful levy action from nine months to two years. It also gave the IRS authority to return money seized or monetary proceeds of property sold following a levy within two years of the date of levy. To put the changes in context, a bit of background is in order.
Congress has given the IRS very potent collection tools; it can impose a lien on a taxpayer’s property, and it can seize property from a taxpayer, all without a court order.… Read More
Carpe diem, the Latin exhortation to “seize the day” (or more accurately pluck it) has been a favorite theme of poets ranging from Horace to Andrew Marvell. And for Pennsylvania taxpayers, it happens to be good advice concerning tax refunds, because the seemingly straight-forward limitations provision for refund claims continues to confound courts, lawyers, and taxpayers.
Here’s what it says:
For a tax collected by the Department of Revenue, a taxpayer who has actually paid tax, interest or penalty to the Commonwealth or to an agent or licensee of the Commonwealth authorized to collect taxes may petition the Department of Revenue for refund or credit of the tax, interest or penalty.
… Read More
Employers are required to withhold FICA and income tax from employees’ pay checks and make periodic deposits of the amounts withheld. If the taxes are not withheld and paid over to the IRS, the employer is subject to monetary penalties and individuals affiliated with the employer may face personal liability for the trust fund recovery penalty. See I.R.C. §§ 6656 (employer penalty); 6672 (trust fund recovery penalty).
The failure “to collect, account for, and pay over” these taxes is also a felony. I.R.C. § 7202. While payroll tax violations were rarely prosecuted historically, times have changed, and the Tax Division has made employment tax prosecutions a priority.… Read More
Nothing in the Internal Revenue Code is simple.
In most cases that wind up in court, there is a statute of limitations. In tax cases, there are two: Section 6501 of the Code governs how long the government has to issue an assessment of additional tax after a taxpayer files a return, while Section 6502 governs how long it has to collect or to file a suit to collect.
And Section 6501 does not offer a single period to assess. Instead it offers three: a three year period, which is the norm, a six year period, which may be applied where gross income is understated, and an infinite period, which is applied where a false or fraudulent return is filed, a taxpayer willfully attempts to evade tax liability, or no return is filed.… Read More