The Treasury Inspector General for Tax Administration today released Challenges Remain When Processing Undeliverable Mail and Preventing Violations of Taxpayers’ Rights During the Lien Due Process (2011-30-051):

Some taxpayers’ rights may have been jeopardized or violated because the IRS failed to prove it timely sent notices of Federal tax lien filings.

Each year, TIGTA is legally required to determine whether tax lien notices issued by the IRS comply with the statutory requirement to notify taxpayers in writing, at their last known address, within five business days of the lien filings. The IRS also has its own procedures for notifying taxpayers’ representatives when Federal tax liens are filed. However, the IRS may not have always complied with this statutory requirement and it does not always follow its own procedures for timely notifying taxpayer representatives of the filing of lien notices. …

TIGTA reviewed a sample of 125 Federal tax liens filed for the 12-month period ending June 30, 2010. TIGTA could not determine whether all of these notices were mailed timely. In addition, TIGTA found that the IRS did not always follow its own procedures for notifying taxpayers’ representatives that Federal tax lien notices had been filed. TIGTA estimated that more than 32,000 taxpayers may have been adversely affected. Also, in situations when a lien notice was returned as undeliverable, TIGTA found that the IRS did not always resend these undeliverable notices even though it had updated addresses for the taxpayers.