I rather like this story by retired Revenue Officer Wayne Vinson. It may be dated, but much of it is still true today. It is also unique that the USPO become part of the story – Simon
On bad collection cases, timing is important—luck also helps. A case that has been around for 3 or 4 years or more, has probably been assigned to several revenue officers and nobody has been able to close it. A revenue officer was evaluated partly on how many overage cases he had. A group supervisor was evaluated mostly on how many overage cases his group had. Any case over 2 years old was overage—you did not want to have many of those when evaluation time came around.
I’d been an RO for 2 or 3 years when I got such a case, a tattered old thing with a file a mile long—income tax for 1958. The taxpayer was a builder of houses and when the economy went down he went down with it. The guy had filed bankruptcy and it was absolutely clear that IRS would not be paid from the bankruptcy proceeding. He was broke—and he was gonna flee the scene just as soon as he received a tax refund from IRS. And leave me with an old, doggy case.
Here’s what happened. The taxpayer had good years before 1959, and had paid a lot of income tax. But in 1959 his business suffered a large net operating loss and he did not pay his 1958 income tax. He stayed in business for a few more years, basically losing money, making (and breaking) payment agreements with IRS. Eventually, someone told the taxpayer he could carry the net operating loss back to the years in which he’d paid taxes; the loss would offset the income and generate a refund. Good advice.
When I got the case, the taxpayer was waiting for his refund, a big one even if IRS took part of it to pay his 1958 income tax—which was supposed to be automatic, right? Wrong. It was before computers, everything was done manually in the district office, and the district office had screwed up. I called the district office and learned that the taxpayer would get the full amount of the refund and my 1958 tax case would not be paid.
The district person told me the date the refund had been approved. I figured the refund check would hit the taxpayer’s post office within the next day or two. The next day happened to be a Saturday and I didn’t work on Saturdays—ordinarily. I typed a levy (similar to a garnishee) to serve on the post office, to attach a refund check belonging to the taxpayer. I took it home with me. That evening a college friend stopped at our place for a visit. Fortunately he stayed the night, because the next day my car wouldn’t start.
So we used his car to get to the post office in the town where the taxpayer lived. He stayed in his car while I went inside and explained what a levy was to the postal employee. I wanted him to hold the levy until the refund check came in. But he said he thought a government check was in the mail that very morning for the taxpayer—and the mail was still in the post office.
The postal guy checked and—glory be- it was there. I gave him the levy and he gave me the refund check. Then my friend drove me to the taxpayer’s house and luckily the taxpayer was there. I explained to the taxpayer that I had his refund check and that we would go to his bank and cash the check— and get a bank money order to pay his 1958 tax. He was agreeable but said he didn’t have a car—would we take him in our car?
We would, gladly. So we went to the bank and the taxpayer and I went in together. I feared he might cash the check and then walk out without paying the old account. So I had him sign the check and I presented it to the cashier. I identified myself and told her how much we needed to pay off his 1958 account. She gave me a bank money order made payable to IRS and gave him the rest of the refund in cash. We took him home. I guess he thought that was the way IRS did business, routinely.
About the levy I served on the Post Office: There was a question about whether or not a levy on the US mail was legal. To my knowledge no one had ever served one on the Post Office, before I did. Shortly after I served mine, we got a ruling from IRS which was that IRS would not levy on the US mail. I may have been the only one who ever seized funds from the United States Post Office.
I had quite a story to tell my IRS buddies on Monday morning. Of course IRS never paid me for the Saturday work, nor did I ask it to. But I was paid enormously in job satisfaction.
Wayne Vinson was an IRS agent for 33 years and the author of a real thriller, Tax Collectors and Other Sinners, the story of a psycho killing tax collectors. It is available at amazon.com as an E-book or soft cover.