A taxpayer is a person or a corporation that must pay taxes to the government based on their income. In the technical sense, they are liable for, subject to, or obligated to pay tax to the government based on the country’s tax laws.

Taxpayers are primarily classified into two types that are individuals and corporations:

1. Individuals – These taxpayers are people who are liable to pay tax for their income.
2. Corporations – These taxpayers are liable to pay tax on the profits earned during the previous year from their business activities.

Below are the major taxpayers rights.

The Right to Be Informed

Taxpayers have the right to know what they need to do to comply with tax laws. They are entitled to clear explanations of the law and IRS procedures in all tax forms, instructions, publications, notices, and correspondence. They have the right to be informed of IRS decisions about their tax accounts and to receive clear explanations of the outcomes.

• If you receive a notice fully or partially disallowing your refund claim, including a refund you claim on your income tax return, it must explain the specific reasons why the claim is being disallowed. IRC § 6402(l)
• Generally, if you owe a penalty, each written notice of such penalty must provide an explanation of the penalty, including the name of the penalty, the authority under the Internal Revenue Code, and how it is calculated. IRC § 6751(a)
• During an in-person interview with the IRS as part of an audit, the IRS employee must explain the audit process and your rights under that process. Likewise, during an in-person interview with the IRS concerning the collection of your tax, the IRS employee must explain the collection process and your rights under that process. IRC § 7521(b)(1)
  Generally, the IRS uses Publication 1, Your Rights as a Taxpayer to meet this requirement.
• The IRS must include on certain notices the amount (if any) of the tax, interest, and certain penalties you owe and must explain why you owe these amounts. IRC § 7522
• The IRS must inform you in certain publications and instructions that when you file a joint income tax return with your spouse, both of you are responsible for all tax due and any additional amounts due for that tax year, unless “innocent spouse” relief applies. RRA 98 § 3501(a)
• The IRS must inform you in Publication 1 Your Rights as a Taxpayer and all collection related notices that in certain circumstances you may be relieved of all or part of the tax owed with your joint return. This is sometimes referred to as “innocent spouse relief.” RRA 98 § 3501(b)
• The IRS must explain in Publication 1 Your Rights as a Taxpayer how it selects which taxpayers will be audited. RRA 98 § 3503
• If the IRS proposes to assess tax against you, it will send you a letter providing the examination report, stating the proposed changes, and providing you with the opportunity for a review by an Appeals Officer if you respond generally within 30 days. This letter, which in some cases is the first communication from the examiner, must provide an explanation of the entire process from examination (audit) through collection and explain that the Taxpayer Advocate Service may be able to assist you. RRA § 3504
  Generally, Publication 3498, The Examination Process, or Publication 3498-A The Examination Process (Audits by Mail) is included with this letter.
• If you enter into a payment plan, known as an installment agreement, the IRS must send you an annual statement that provides how much you owe at the beginning of the year, how much you paid during the year, and how much you still owe at the end of the year. RRA § 98 3506, Treas. Reg. § 301.6159-1(h)
• You have the right to access certain IRS records, including instructions and manuals to staff, unless such records are required or permitted to be withheld under the Internal Revenue Code, the Freedom of Information Act, or the Privacy Act. Certain IRS records must be available to you electronically.
• If the IRS is proposing to adjust the amount of tax you owe, you will typically be sent a statutory notice of deficiency, which informs you of the proposed change. This notice provides you with a right to challenge the proposed adjustment in Tax Court without first paying the proposed adjustment. To exercise this right, you must file a petition with the Tax Court within 90 days of the date of the notice being sent (or 150 days if the taxpayer’s address on the notice is outside the United States or if the taxpayer is out of the country at the time the notice is mailed). Thus, the statutory notice of deficiency is your ticket to Tax Court. IRC §§ 6212; 6213(b)

The Right to Quality Service

Taxpayers have the right to receive prompt, courteous, and professional assistance in their dealings with the IRS, to be spoken to in a way they can easily understand, to receive clear and easily understandable communications from the IRS, and to have a way to file complaints about inadequate service.

Read Also: International Tax Treaties And Their Functions

• The IRS must include information about your right to Taxpayer Advocate Service (TAS) assistance, and how to contact TAS, in all notices of deficiency. IRC § 6212(a)
• When collecting tax, the IRS should treat you with courtesy. Generally, the IRS should only contact you between 8 a.m. and 9 p.m. The IRS should not contact you at your place of employment if the IRS knows or has reason to know that your employer does not allow such contacts. IRC § 6304
• If you are an individual taxpayer eligible for Low Income Taxpayer Clinic (LITC) assistance(generally your income is at or below 250% of the federal poverty level), the IRS may provide information to you about your eligibility for assistance from an LITC. IRC § 7526
• Certain notices written by the IRS must contain the name, phone number, and identifying number of the IRS employee, and all notices must include a telephone number that the taxpayer may contact. During a phone call or in-person interview, the IRS employee must provide you with his or her name and ID number. RRA 98 § 3705(a)
• The IRS is required to publish the local address and phone number of the IRS in local phone books. RRA 98 § 3709

The Right to Pay No More Than the Correct Amount of Tax

Taxpayers have the right to pay only the amount of tax legally due and to have the IRS apply all tax payments properly.

• If the IRS is proposing to adjust the amount of tax you owe, you will typically be sent a statutory notice of deficiency, which informs you of the proposed change. This notice provides you with a right to challenge the proposed adjustment in Tax Court without first paying the proposed adjustment. To exercise this right, you must file a petition with the Tax Court within 90 days of the date of the notice being sent (or 150 days if the taxpayer’s address on the notice is outside the United States or if the taxpayer is out of the country at the time the notice is mailed). Thus, the statutory notice of deficiency is your ticket to Tax Court. IRC §§ 6212; 6213(b)
  For more information about the United States Tax Court, see the Court’s taxpayer information page.
• If you are an individual taxpayer eligible for Low Income Taxpayer Clinic (LITC) assistance(generally your income is at or below 250% of the federal poverty level), the IRS may provide information to you about your eligibility for assistance from an LITC. IRC § 7526
• If you believe you have overpaid your taxes, you can file a refund claim asking for the money back, within certain time limits. IRC § 6402.
  See IRS Publication 17, Your Federal Income Tax under the heading “What if I Made a Mistake”
  See also IRC § 6511: Limitations on claim for credit or refund (statute of limitations) under the Right to Finality.
• You may request that any amount owed be removed if it exceeds the correct amount due under the law, if the IRS has assessed it after the period allowed by law, or if the assessment was done in error or violation of the law. IRC § 6404(a)
• You may request that the IRS remove any interest from your account that was caused by the IRS’s unreasonable errors or delays. For example, if the IRS delays issuing a statutory notice of deficiency because the assigned employee was away for several months attending training, and interest accrues during this time, the IRS may abate the interest as a result of the delay. IRC § 6404(e)
• If you have a legitimate doubt that you owe part or all of the tax debt, you can submit a settlement offer, called an Offer in Compromise – Doubt as to Liability offer on Form 656-L. IRC § 7122
• You will receive an annual notice from the IRS stating the amount of the tax due, which will help you check that all payments you made were received and correctly applied. IRC § 7524
• If you enter into a payment plan, known as an installment agreement, the IRS must send you an annual statement that provides how much you owe at the beginning of the year, how much you paid during the year, and how much you still owe at the end of the year. RRA § 98 3506, Treas. Reg. § 301.6159-1(h)

The Right to Challenge the IRS’s Position and Be Heard

Taxpayers have the right to raise objections and provide additional documentation in response to formal IRS actions or proposed actions, to expect that the IRS will consider their timely objections and documentation promptly and fairly, and to receive a response if the IRS does not agree with their position.

• If you submit documentation or raise objections during an examination, and the IRS does not agree with your position, it will issue a statutory notice of deficiency explaining why it is increasing your tax, which gives you the right to petition the U.S. Tax Court prior to paying the tax. IRC § 6212
• If you are an individual taxpayer eligible for Low Income Taxpayer Clinic (LITC) assistance(generally your income is at or below 250% of the federal poverty level), the IRS may provide information to you about your eligibility for assistance from an LITC. IRC § 7526
  For more information, see IRS Publication 4134, Low Income Taxpayer Clinic List. Or find an LITC near you.
• If you are notified by the IRS that it has adjusted your return because of a mathematical or clerical error, you have 60 days to tell the IRS that you disagree. If the IRS is not persuaded, it will issue you a Statutory Notice of Deficiency proposing a tax adjustment. This notice provides you with a right to challenge the proposed adjustment in Tax Court by filing a petition within 90 days of the date of the notice (150 days if the notice is addressed to a person outside the United States), without first paying the proposed adjustment. IRC § 6213(b)
  For more information about the United States Tax Court, see the Court’s taxpayer information page.
• Immediately after the IRS files a notice of federal tax lien in the appropriate state filing location, the IRS must generally provide you with an opportunity for a hearing before an independent IRS Appeals/Settlement Officer. At that hearing, you can raise alternatives to the IRS’s collection action and may even be able to challenge whether you actually owe the tax. If you disagree with Appeals’ determination, you can go to Tax Court. IRC § 6320
  For more information about the United States Tax Court, see the Court’s taxpayer information page.
• Before the IRS takes its first enforcement action to collect a tax debt by levying, for example, your bank account, the IRS must generally provide you with an opportunity for a hearing before an independent IRS Appeals/Settlement Officer. At that hearing, you can raise alternatives to the IRS’s collection action and may even be able to challenge whether you actually owe the tax. If you disagree with Appeals’ determination, you can go to Tax Court. IRC § 6330

The Right to Privacy

Taxpayers have the right to expect that any IRS inquiry, examination, or enforcement action will comply with the law and be no more intrusive than necessary, and will respect all due process rights, including search and seizure protections and a collection due process hearing where applicable.

• During a Collection Due Process hearing, an independent IRS Appeals/Settlement Officer must consider whether the IRS’s lien filing balances the government’s need for the efficient collection of taxes with your legitimate concern that the IRS’s collection actions are no more intrusive than necessary. IRC § 6320
• During a Collection Due Process hearing, an independent IRS Appeals/Settlement Officer must consider whether the IRS’s proposed levy action balances the government’s need for the efficient collection of taxes with your legitimate concern that the IRS’s collection actions are no more intrusive than necessary. IRC § 6330
• The IRS cannot levy any of your personal property in the following situations: before it sends you a notice of demand, while you have a request for a payment plan pending, and if the IRS will not recover any money from seizing and selling your property. IRC § 6331
• The IRS cannot seize certain personal items, such as necessary schoolbooks, clothing, undelivered mail, certain amounts of furniture and household items, and tools of a trade. IRC § 6334(a)
• There are limits on the amount of wages that the IRS can levy (seize) in order to collect tax that you owe. A portion of wages equivalent to the standard deduction combined with any deductions for personal exemptions is protected from levy. IRC § 6334(d)

The Right to Confidentiality

Taxpayers have the right to expect that any information they provide to the IRS will not be disclosed unless authorized by the taxpayer or by law. Taxpayers have the right to expect the IRS to investigate and take appropriate action against its employees, return preparers, and others who wrongfully use or disclose taxpayer return information.

• In general, the IRS may not disclose your tax information to third parties unless you give it permission, e.g., you request that we disclose information in connection with a mortgage or student loan application. IRC § 6103
• If a tax return preparer discloses or uses your tax information for any purpose other than for tax preparation, the preparer may be subject to civil penalties. If the disclosure or improper use is done knowingly or recklessly, the preparer may also be subject to criminal fines and imprisonment. IRC §§ 6713, 7216
• Communications between you and an attorney with respect to legal advice the attorney gives you are generally privileged. A similar privilege applies to tax advice you receive from an individual who is authorized to practice before the IRS (e.g., certified public accountant, enrolled agent, and enrolled actuary), but only to the extent that the communication between you and that individual would be privileged if it had been between you and an attorney. For example, communication between you and an individual authorized to practice before the IRS regarding the preparation of a tax return is not privileged because there would be no similar privilege between a taxpayer and an attorney. The privilege relating to taxpayer communications with an individual authorized to practice before the IRS only applies in the context of noncriminal tax matters before the IRS, and noncriminal tax proceedings in Federal court where the United States is a party. IRC § 7525
• In general, the IRS cannot contact third parties, e.g., your employer, neighbors, or bank, to obtain information about adjusting or collecting your tax liability unless it provides you with reasonable notice in advance. Subject to some exceptions, the IRS is required to periodically provide you a list of the third party contacts and upon request. IRC § 7602(c)