IRS Collection Due Process Hearings
The IRS is a notoriously aggressive debt collector with many collection tools available, including the ability to lien and levy on a taxpayer’s property. One way to attempt to stop IRS collection activity is to request a Collection Due Process (“CDP”) Hearing. Collection activity is usually frozen while the CDP hearing is pending.
A CDP hearing provides the taxpayer with an opportunity to have his case reviewed by an IRS Appeals Officer. At the hearing, the taxpayer has an opportunity to establish why the IRS should cease collection activity against him. The taxpayer can propose alternative collection methods such as an Offer in Compromise or Installment Agreement instead of federal tax liens and/or levies. In situations where the IRS has already rejected a proposed Offer in Compromise or Installment Agreement, the taxpayer can use the CDP hearing to request reconsideration. In some cases, the taxpayer can argue that the amount of the tax liability is incorrect or that he is not responsible for the entire amount.