Discussion:Deposit in the Nature of a Cash Bond-Stop IRS in its track!
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| 19 July 2007 | |
| Deposit in the Nature of a Cash Bond-Stop IRS in its track!
Anyone have any experience with this little trick and how it actually works in reality? Under IRS Rev Proc 84-58 (as codified and superseded by Rev Proc 2005-18), this supposed to stop IRS collections and also give the taxpayer certain rights when making a payment for taxes owed while contesting the Penalties and interest portion. This is in lieu of the traditional tax payment. On a practical level, has anyone ever used this and how does this play out? | |
Death&Taxes (talk|edits) said: | 19 July 2007 |
| I have seen the Deposit in Nature of a Cash Bond used often in the past in audit situations when I worked for a tax lawyer. A typical example would have IRS sending 30-day letter. In addition to making a request to send the case to Appeals, we would recommend to the client that they make such payment based on our appraisal of the final result of the case. By the time the case was settled and assessed (sometimes after petitioning the Tax Court), the payment would be applied, though sometimes IRS had to have its memory jogged. The payment was not sent with the response to the 30-day letter, but directly to the Service Center (I believe....memory sometimes fails).
As I recall, the downside is that if the Deposit exceeds the liability, no interest is paid by the Treasury. I think your headline overhypes the result. | |
| 19 July 2007 | |
| the headline sounds like it was directly lifted from one of those Bottom Line publications that purport to give you little known secrets when in reality they give you secrets that are little used because they have little application to reality. Usually they end with "this information was provided by John Doe, Esq., a former high ranking official at the IRS, still well connected."
As if attorneys actually still used the term 'Esquire' instead of JD. | |
