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Jesse Handel
Jesse Handel, Tax Preparer
Category: Tax
Satisfied Customers: 270
Experience:  10 years tax preparation. IRS Registered Tax Preparer.
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My business was levied by the IRS when we fell behind on payroll

Customer Question

My business was levied by the IRS when we fell behind on payroll taxes. The IRS sent our bank the levy, but also sent it to one of our competitors! Yes, one of our competitors and former employee. When asked, the IRS Revenue Agent stated that he must have found some link to the other company through research. This company did not owe our company any money nor did we owe them any money.

Is this not against some confidentiality policy or disclosure rule within the IRS or can they send this type of information to anyone they want?
Submitted: 3 years ago.
Category: Tax
Expert:  USTaxAdvising replied 3 years ago.

They can levy whomever bank accounts they deem connected to you to satisfy your payroll liabilities. It does seem odd that they are going after your competitor but if the competitor now has one of your former employees there may be some connection.

 

Generally the IRS does not do this sort of thing without having all thier "ducks in a row."

If they are able to levy those bank accounts and actually collect then they probably have legal ground. (as I am assuming your competitor will refute the claim prior to the actual garnishment)

 

Basically the IRS can not provide your personal or business information to anyone without your consent. Generally this is provided via a Form 2848 Power of Attorney.

 

Hopefully this answers your question, let me know if you have any further questions.

 

Customer: replied 3 years ago.
The competitor and former employee shared the information they received in the levy with some of our mutual vendors. There was absolutely no ties to the former employee in any way, or the company.

If there is an actual rule or IRS policy on disclosing our financial information? This was more or less my question. I would like to be at least pointed in the right direction to find the IRS rules/policies on disclosure.
Expert:  William Ellis, CPA replied 3 years ago.
Good morning. I will relay your question to another expert here who is a tax lawyer. I am not a lawyer, but there is a basic legal principle of estoppal that could be used in your case. Thanks, Bill
Customer: replied 3 years ago.

Thanks

 

Expert:  William Ellis, CPA replied 3 years ago.
Hi, the one tax attorney I turn to the most has too much on his plate. There are no other tax attorneys on line at this time. I'll hand it off as soon as possible.
Customer: replied 3 years ago.

OK. Thank you for your help.

Expert:  Jesse Handel replied 3 years ago.

Hello and thank you for coming to Just Answer. We appreciate the opportunity to help you with your tax questions. I am not a lawyer and you are not required to accept my answer if you would prefer to wait for a tax lawyer to address your legal remedies against the IRS for violating the confidentiality of your business information by sharing it with your competitor. You requested information about the IRS' rules about privacy and confidentiality and the remedies the IRS offers if they violate their own privacy rules. This link goes to the IRS' privacy policy and their own rules regarding how they handle your information. http://www.irs.gov/privacy/index.html

You can accept my answer and relist your question regarding what legal remedies are available to you in the Just Answer Legal category, or you can just accept my answer and follow up with the IRS' privacy office and/or the taxpayer advocate, or you can ask me to opt out and continue waiting for a tax lawyer to address your question. If you would prefer to continue waiting for a tax lawyer, it won't hurt my feelings. Just let me know and I will be happy to opt out of the question, so that, hopefully, one of our lawyers can address it. I just want you to be satisfied with the answer you receive.

Jesse Handel, Tax Preparer
Category: Tax
Satisfied Customers: 270
Experience: 10 years tax preparation. IRS Registered Tax Preparer.
Jesse Handel and 7 other Tax Specialists are ready to help you
Customer: replied 3 years ago.
Thank you. The link you provided answers my question. I simply wanted to be pointed in the correct direction.
Expert:  Jesse Handel replied 3 years ago.
I'm very glad that I could help you. I hope things go well for you. Thank you for coming to Just Answer.

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Jesse Handel
Jesse Handel
Tax Preparer and Chemist
146 Satisfied Customers
10 years tax preparation. IRS Registered Tax Preparer.