As it has been previously reported, taxpayers in FEMA-designated disaster areas were supposed to have more time to pay certain taxes owed. However, this has not stopped the IRS from mistakenly sending out collection notices in these areas, demanding that these taxpayers pay what they owe immediately.
Overview
Erin Collins is a National Taxpayer advocate, and she acknowledged the agencies’ mistake in a blog post that she made. “Short answer: Disaster area taxpayers can ignore the CP14 collection notice,” says Collins. “The payment due date on the collection notice is wrong. The correct payment due date is stated on the disaster declaration.” CP14 is a balance-due notice that is sent to taxpayers.
Disaster Relief Areas
Earlier this year, the IRS disaster page listed a plethora of areas that qualify for tax relief. These areas include parts of Alabama, Arkansas, California, Florida, Georgia, Indiana, Mississippi, and Tennessee. Furthermore, Erin Collins thought it would be a good time to clarify this IRS mistake, as many regions of the United States have been suffering through heat waves, and upstate New York is dealing with serious flooding problems.
IRS Statement
“The IRS is working hard to improve our operations as part of our new Strategic Operating Plan,” said IRS Commissioner Danny Werfel in a statement. “We know our initial mailing caused confusion for taxpayers and tax professionals, and we worked quickly to send a follow-up reminder to help reassure people. This mailing reflects how we’re trying to be more taxpayer-focused given the additional resources that we’ve been given under the Inflation Reduction Act.”
Wrap Up
Since the IRS has been sending these CP14 collections notices to areas that have been given months of additional time to pay, it has been causing confusion for both taxpayers and practitioners in these areas. As time goes on, we will have to wait and see if the Internal Revenue Service will rectify this problem. If they do not rectify this situation, they can be expecting a lot of phone traffic coming their way.