In a move that could significantly affect how tax practitioners manage IRS information requests, National Taxpayer Advocate Erin Collins has voiced strong opposition to proposed IRS regulations that would dramatically reduce third-party notice requirements from 45 days to as few as 10 days in certain circumstances.
The Core Issue
The proposed changes would create exceptions to taxpayer protections established by both the 1998 IRS Restructuring and Reform Act and the 2019 Taxpayer Protection Act. These laws currently require the IRS to provide a 45-day notice before contacting third parties—such as tax preparers or financial institutions—for information related to tax assessment or collection.
"This proposed change could create significant ...