Sleep better knowing Automated Collection System can’t seize your property
When owing money to the IRS, worst-case scenarios flash through your mind: your house will be taken, one morning you will wake up to find your car no longer in the driveway, your business will be seized and shut down by the IRS.
You can relax, however – the reality is that IRS seizures are less likely than you think.
How does the IRS collect my taxes?
When thinking about your future with the IRS, it’s important to know there are two primary ways the IRS attempts to collect your unpaid taxes: through Revenue Officers or by the Automated Collected System (ACS). A Revenue Officer is a human being while ACS is a computerized collection system and call center.
Your worst fears of losing your house, car, or business can only occur when the IRS assigns your unpaid taxes to be collected by a Revenue Officer. ACS, on the other hand, can only do what a computer can, and an IRS computer cannot seize houses, cars, or shut down businesses.
Even though you owe money to the IRS, it’s important to realize there are millions of people in your situation – far more than the number of IRS Revenue Officers who seize property. For example, in 2021, there were over 10 million individuals owing money to the IRS and only 2,783 Revenue Officers. As a result, the overwhelming majority of IRS collection cases are handled by the ACS rather than Revenue Officers. This limits what the IRS can do.
What is the IRS Automated Collection System?
Automated Collection System (ACS) operates by sending out computer-generated notices or garnishments. Then, the IRS expects that these notices will scare you and prompt you to call an IRS ACS call center where you will be connected to a collection agent trained to start investigating your finances. It is important to remember that IRS ACS agents work at call centers, and only answer calls – they do not call you. Each time you call the ACS, you will be connected to a new agent, as it is randomized and not personalized to your case. You will never get the same ACS agent on the phone twice.
No individual ACS agent follows your case. The ACS only knows where you work and bank (from the information provided to the IRS on your W2 and 1099s). They do not know the value of your house, the car you drive, or your business assets.
As Automated Collection Service agents work in call centers throughout the country, they won’t be leaving their desk in Texas to take your car located in California.
What is an IRS Revenue Officer?
On the other hand, Revenue Officers are the agents located in your city and are required for the scary seizures of your property and assets. Property seizures are sensitive and highly nuanced situations which the computerized ACS is not equipped to handle.
With millions more tax accounts than Revenue Officers, it is unlikely you will be assigned to a Revenue Officer. It is even more unlikely that your property is seized – in 2021, the IRS reported 96 seizures, which includes houses, cars, business assets, out of the 10 million individuals with unpaid taxes.
To protect yourself from being assigned to a Revenue Officer, be careful and proactive to remain in what the IRS calls “compliance.” Compliance means that if you have unfiled returns, you voluntarily file them, preventing a Revenue Officer from knocking on your door and requesting them. It also means that you need to break the cycle of having year after year of unpaid taxes – start paying and avoid flagging a Revenue Officer who is upset that your pile to the IRS keeps growing.
Before making a call to the ACS, be sure you are well-advised. If you are not careful in what you say or call blindly, the ACS may hand your case off to a Revenue Officer for further investigation, claiming you owe too much and the case is more than the call center can handle.
The fear of having property being seized by the IRS is understandable, but not usually the reality. IRS seizures are less common than you think. This is because the IRS cannot maintain enough Revenue Officers (the only ones with the ability to seize your home, car, business assets) to match the number of unpaid tax accounts. As a result, the majority of tax cases are handled by the Automated Collection System, an IRS call center primarily limited to garnishing your wages and bank accounts. By calling ACS, you could be waking up a sleeping giant, ultimately making matters worse. Before making a move to resolve your case, make sure you understand what you are stepping into.