The Internal Revenue Service (IRS) has a number of tools and resources at its disposal, which its Field Collection employees as well as other IRS personnel may use to track down a tax debtor’s assets. The IRS will track these assets for a wide variety of reasons. Whether it be to place a federal tax lien on the assets, to review a person’s financial situation pursuant to an offer in compromise determination, the IRS’ methodologies for determining the tax debtor’s assets are useful to understand for a taxpayer with outstanding federal tax obligations. What do IRS agents use to locate assets?
The IRS employs a number of databases and search tools to track down a tax debtor’s assets, including a national asset locator tool, which searches several asset/locator services, credit bureau services, and tax law research services. The national asset locator tool also searches public records of real property, real state transactions, corporate officers, vehicles and aircraft, and information on people and businesses. In addition, IRS personnel utilize a credit bureau web browser, a tax law research portal, Department of Vehicles (DMV) records, real property title searches, Uniform Commercial Code filings, and corporate information from the Secretary of State. Bear in mind that many of these resources are state agency resources, and one should note that these state actors can and often will cooperate with the IRS to provide them with relevant financial information about a tax debtor. Internal Revenue Service, Internal Revenue Manual, 18.104.22.168 (03-27-2012), available at https://www.irs.gov/irm/part5/irm_05-001-018r.html. In short, whether by way of corporate contracts with research services or intergovernmental relationships with state agencies, the IRS is well-equipped to find whatever assets they are looking for.
Taxpayers should note that there are a great deal of privacy procedures in place, which are designed to protect the tax debtor’s privacy notwithstanding an investigation of his or her assets. The Privacy and Information Protection (PIP) Office ensures that taxpayer information is protected and is not the subject of an improper disclosure. PIP houses three departments: the Office of Privacy, Identity Protection, and Incident Management. Issues regarding privacy and disclosure of confidential taxpayer information should be directed to these departments.
Asset investigation is a major part of what the IRS does, and they have the tools to track down a taxpayer’s assets pursuant to any number of functions. To learn more about IRS capabilities in asset location as they apply to your particular situation, contact an experienced tax attorney.
Please keep in mind the information and advice presented in this blog is not intended to be used as formal legal advice. Contact a tax professional for personalized tax advice pertaining to your specific situation. While we try and answer all parts of the question when we write our blogs, sometimes there may be some left unanswered. If you have any questions about your problems with the IRS, SBOE, FTB, or BOE, or tax law in general, call RJS Law at (619) 595-1655.