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IRS may be unreliable for tax advice

On Behalf of | Sep 26, 2017 | IRS Issues

According to a national advocate for taxpayers, people in Georgia and across the U.S. should not rely on much of the information provided on the Internal Revenue Service website. Specifically, the Frequently Asked Questions page and other guidance on the site listed as unofficial may not be accurate when it comes to actually filing taxes. There are three categories of guidance provided by the IRS.

First, IRS regulations are binding on taxpayers and the IRS except on the rare occasions that a tax court invalidates a regulation. Sometimes proposed regulations are also binding. Relying on guidance published by the IRS in final and temporary regulations is generally okay; the taxpayer cannot be assessed penalties or additional taxes for doing so.

Second, the IRS also publishes official guidance in the form of Revenue Procedures, Revenue Rulings, Announcements and Notices as part of its Internal Revenue Bulletins. Generally speaking, the IRS and taxpayers are bound by this published official guidance. There are situations, though, where taxpayers may be able to persuade the court that their own understandings of the rules and regulations are correct. Like those who rely on IRS regulations, taxpayers who rely on published official guidance cannot be assessed additional penalties or taxes.

Finally, regarding unofficial guidance, the official position of the IRS is that taxpayers should not rely on it. Unofficial guidance includes press releases, website articles, IRS tax forms, IRS tax instructions and website FAQs.

In a situation where an individual has questions about the proper handling of income or expenses on tax returns, an attorney may be able to help. An attorney with experience in tax law may be able to communicate with the IRS on the client’s behalf or draft and file necessary tax documents. An attorney may be able to fight a tax lien that has been imposed.