A Kinder, Gentler IRS?

IRS enforcement actions such as liens and garnishment of wages are down dramatically, in part because employees fear firing under a new law enacted to protect taxpayer rights.

The Internal Revenue Service seized property for overdue taxes 108 times in the six months that ended March 31, compared with 1,150 during the same span last year and 5,000 seizures two years ago.

Garnishments of wages and levies on bank accounts dropped to 458,000 in the most recent six months from 1.8 million two years ago, while liens on property dropped from 272,000 to 98,000.

At the same time, the IRS has relaxed requirements for installment agreements to pay off taxes and for Â"offers-in-compromiseÂ" for taxpayers who have no hope of paying a large bill.

The statistics, first reported Monday in The New York Times, stem in part from a tight IRS budget and shifting of some employees temporarily to new duties, such as answering telephones. But IRS officials acknowledged that fear of new taxpayer protection laws was an equal factor.

In a March memo to all IRS employees, Commissioner Charles Rossotti sought to assure employees that they would get adequate training to adhere to the 1998 reform law passed by Congress and that their rights as workers would not be overlooked.

Â"There are concerns in the workforce,Â" said IRS spokesman Steve Pyrek. Â"There's a tremendous training need, especially among the people who work in collections.Â"

The section of the law at issue set up 10 firing offenses that are immediate and cannot be appealed. Dismissal requires that the conduct be willful and involve such things as failing to obtain required approval for a property seizure, violating a taxpayer's constitutional rights, falsifying or destroying documents and concealing information from Congress.

The memo from Rossotti includes Â"important remindersÂ" for employees, the first of which stress the primacy of taxpayer rights and fair treatment of IRS workers themselves.

In addition, Pyrek said the new law changed the rules on when agents should begin collection actions, meaning some of them were delayed earlier this year and will still take place.