IRS terrifies taxpayers with baseless threats to seize their property

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The IRS is mailing out “probably thousands” of threatening letters that warn taxpayers their property is about to be seized for unpaid taxes — even though the government already got its money, The Post has learned.

The scary situation is the latest snafu involving the hated agency, which last year issued similarly baseless threats to confiscate state tax refunds to cover purportedly unpaid federal taxes, CNBC reported at the time.

That blunder came after House Ways and Means Committee Chairman Richard Neal (D-Mass.) in August called on the IRS to stop sending out notices for unpaid taxes because it had let about 12 million pieces of mail pile up during the summer.

One recent “Final Balance Due Reminder” reviewed by The Post falsely claims that “we have not received your overdue tax after sending several notices to you.”

“You must pay your balance immediately or we will levy (seize) your property,” it says.

“If you do not make your payment now, we will consider your noncompliance an active choice and you could face a levy.”

The official correspondence also contains instructions for gathering necessary information from past tax returns and making one or more payments directly from a bank account.

E. Martin Davidoff, an accountant and lawyer who runs the National Tax Controversy Practice at the international accounting firm Prager Metis, said he’s aware of colleagues whose clients have been caught up in the latest wave of groundless accusations from the IRS.

“There are probably thousands,” he said.

Davidoff also noted that the IRS warnings have recently taken on a more ominous tone.

“They’ve revamped this notice to make it more threatening in the last year or two,” he said.

The IRS said it couldn’t immediately comment, but last week, IRS National Taxpayer Advocate Erin Collins said the agency was still reeling from the effects of the coronavirus pandemic, which shuttered all its offices across the country.

“Last year’s filing season was very difficult and the IRS is still digging out of a hole we have been dealing with in respect to last year,” she said during an appearance on C-SPAN.

Collins also said, “Congress has used the IRS not only to be a tax administrator but to help with social programs,” including distributing stimulus checks and administering “a number of credits that are beneficial to individuals.”

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