WASHINGTON — The Internal Revenue Service’s Low Income Taxpayer Clinic (LITC) Program Office has issued its annual program report. The report describes how LITCs provide representation, education, and advocacy for taxpayers who are low income or speak English as a second language (ESL).
The LITC Program is a federal grant program administered by the Taxpayer Advocate Service, led by the Acting National Taxpayer Advocate, Bridget Roberts. LITCs represent individuals whose incomes are below a certain level and need to resolve tax problems with the IRS, such as audits, appeals, and tax collection disputes. They can represent taxpayers in court as well as within the IRS. They also can provide information about taxpayer rights and responsibilities in different languages for ESL taxpayers. LITCs provide services for free or a small fee. They receive IRS grants but work independently to assist and advocate for taxpayers.
During 2018, LITCs represented 19,513 taxpayers dealing with an IRS tax controversy. They helped taxpayers secure more than $4.7 million in tax refunds and reduced taxpayers’ liabilities by nearly $124 million. They also brought more than 4,200 taxpayers back into payment compliance.
Through outreach and education activities, LITCs strived to ensure individuals understood their rights as U.S. taxpayers by conducting more than 1,700 educational activities that were attended by over 16,600 persons. More than 1,800 volunteers contributed to the success of LITCs by contributing nearly 57,000 hours of their time. More than two-thirds of the volunteers were attorneys, certified public accountants, or enrolled agents.
LITCs used a variety of approaches to successfully advocate for taxpayers. These included utilizing collection alternatives to resolve issues administratively within the IRS litigating cases in the United States Tax Court and other federal courts, and elevating systemic issues through the Taxpayer Advocate Service’s Systemic Advocacy Management System. Below is just one example of how an LITC assisted taxpayers in need:
The taxpayers were a senior couple with no children. The husband had served in the military and was disabled during combat operations. He had a construction business, and together he and his wife invested large amounts of time and money into renovating their home into a bed and breakfast. After years of financial setbacks, the couple lost their home and long-time business, and incurred a large outstanding federal tax debt. The taxpayers filed for bankruptcy protection.
At that time, they were living on a fixed income of Social Security and a small Veterans Administration pension in a subsidized senior apartment that they were told they could not live in if they had more than $10,000 in tax debt. The couple came to an LITC after they began receiving certified mail notices from the IRS about the federal tax debt. The LITC called the IRS to request a 60-day hold on collection while the taxpayers gathered documents for an Offer-In-Compromise (OIC). The couple then received a notice of intent to levy their Social Security benefits, and the LITC requested a Collection Due Process hearing, where it helped the couple settle its entire federal tax debt with an OIC for $1. The taxpayers returned a customer satisfaction survey to the LITC and acknowledged the work of the staff attorney by saying, “Wonderful you have such a smart, kind, and caring man on your staff. Thank you so much for everything.”
The full report contains extensive details about the LITC Program and more extraordinary stories about the representation that LITCs provide. It also details the results that LITCs achieved on behalf of their clients.
2020 Grant Recipient List
Through the LITC Program, the IRS awards matching grants of up to $100,000 per year to qualifying organizations. The Internal Revenue Service today announced $11.6 million in matching grants to 131 recipients across the country for development, expansion or continuation of LITCs for the 2020 grant year. IRS Publication 4134, Low Income Taxpayer Clinic List (PDF), provides information about LITCs by geographic area, including contact information and details about the languages, in addition to English, in which each LITC offers services. Publication 4134 is available at IRS.gov.
The grant year began on Jan. 1 and ends on Dec. 31.