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United States Government Accountability Office: 
GAO: 

Report to Congressional Requesters: 

September 2012: 

Federal Tax Debts: 

Factors for Considering a Proposal to Report Tax Debts to Credit 
Bureaus: 

GAO-12-939: 

GAO Highlights: 

Highlights of GAO-12-939, a report to congressional requesters. 

Why GAO Did This Study: 

Millions of individual and business taxpayers owe billions of dollars 
in unpaid federal tax debts, and the IRS expends substantial resources 
trying to collect these debts. Other federal agencies that are owed 
nontax debts report such debts to credit bureaus, in part as a tool to 
encourage debtors to pay. However, IRS is not allowed to directly 
report tax debts to credit bureaus because long-standing federal law 
protects the privacy of taxpayers’ information. IRS is only authorized 
to disclose personally identifiable information reported to or 
developed by IRS in limited circumstances as specified by law. IRS is, 
however, allowed to file tax liens on some tax debts, and such liens 
are public records that are picked up by credit bureaus and included 
in the credit history information they compile. 

GAO was asked to describe (1) IRS's inventory of tax debts and the 
characteristics that may be relevant to a potential proposal to report 
tax debts to credit bureaus and (2) factors that experts believe could 
be useful to consider in the evaluation of any proposal to report tax 
debts to credit bureaus. To conduct this work, GAO reviewed IRS data 
on tax debts and held discussions with selected experts, including 
government and nongovernment officials with experience in tax policy 
and administration, taxpayer and privacy interests, and the credit 
reporting industry. GAO does not make recommendations in this report. 

What GAO Found: 

At the end of fiscal year 2011, individuals and businesses owed a 
total of about $373 billion in federal unpaid tax debts—$258 billion 
in individual debt and $115 billion in business debt. How much of this 
debt would be suitable to report to credit bureaus could depend on the 
purpose of the reporting proposal, such as to collect more debts or 
simply to inform other potential creditors of the existence of tax 
debts. Most of debts were relatively small in size. Well over half of 
individuals and businesses with tax debts owed less than $5,000. 
However, much of the aggregate debt is concentrated among those owing 
relatively large amounts. Debts over $25,000 add up to a total of $310 
billion. Some debts were in the collection process where the Internal 
Revenue Service (IRS) notifies the taxpayer of the debt and were 
subject to dispute by the taxpayer, while other debts were covered by 
installment agreements—about $60 billion of the debts owed were in 
these two categories. About $110 billion of the total debt was 
classified by IRS as uncollectable. IRS files tax liens on some tax 
debts and these liens are public records that credit bureaus routinely 
pick up and add to their data. Over half of the total amount owed was 
subject to liens, cutting across the above categories. 

Subject matter experts commented that issues surrounding data 
accuracy, alternatives, and expected benefits would be among the 
important factors that Congress might wish to consider in regards to 
any possible future proposal to report tax debts to credit bureaus. 
One key factor discussed was the need to ensure that any reported tax 
debt data is accurate and current as this would be important to both 
credit bureaus and the affected taxpayers, who could be denied credit, 
employment, or housing based on inaccurate negative information in 
their credit histories. Some subject matter specialists GAO spoke to 
said that it would be important to consider IRS’s current use of tax 
liens, which are already known to credit bureaus, as an alternative to 
reporting debts directly. Another important consideration would be the 
expected benefits of direct tax debt reporting. These experts 
suggested that such reporting could yield benefits such as increased 
revenue collected or reduced tax debt inventory. However, the National 
Taxpayer Advocate cautioned that such reporting could cause some 
taxpayers to choose not to file or file inaccurately if they know they 
owe money to IRS. 

View [hyperlink, http://www.gao.gov/products/GAO-12-939]. For more 
information, contact James R. White at (202) 512-9110 or 
whitej@gao.gov. 

[End of section] 

Contents: 

Letter: 

Background: 

Of the Overall Billions of Dollars in Federal Tax Debts, Some Debts 
are Small, Subject to Dispute or Change, Not Considered Collectible, 
or Already Known to Credit Bureaus: 

Experts Suggested That Data Accuracy, Alternatives, and Expected 
Benefits Are among the Important Factors to Consider: 

Agency Comments: 

Appendix I: External Parties Contacted: 

Appendix II: List of Threshold and Policy Factor Questions and 
Subquestions That Guided Our Discussions with Subject Matter 
Specialists: 

Appendix III: GAO Contact and Staff Acknowledgments: 

Tables: 

Table 1: Key Differences Between the Tax Debt Inventory and the Tax 
Gap: 

Table 2: IRS Collection Process Status Definitions for Tax Debts: 

Table 3: Tax Debt Inventory by Collection Process Status, as of End of 
Fiscal Year 2011: 

Table 4: Tax Debt Inventory by Financial Reporting Classification, as 
of the End of Fiscal Year 2011: 

Table 5: Tax Debt Inventory for Individuals and Businesses for Which 
Liens Had or Had Not Been Filed by Collection Process Status, as of 
the End of Fiscal Year 2011: 

Figures: 

Figure 1: Tax Debt Inventory in Ranges of Total Debt Owed by an 
Individual, as of the End of Fiscal Year 2011: 

Figure 2: Tax Debt Inventory in Ranges of Total Debt Owed by a 
Business, as of the End of Fiscal Year 2011: 

Abbreviations: 

FCRA: Fair Credit Reporting Act: 

IRS: Internal Revenue Service: 

[End of section] 

United States Government Accountability Office: 
Washington, DC 20548: 

September 10, 2012: 

The Honorable Max Baucus: 
Chairman: 
The Honorable Orrin G. Hatch: 
Ranking Member: 
Committee on Finance: 
United States Senate: 

The Honorable Charles E. Grassley: 
Ranking Member: 
Committee on the Judiciary: 
United States Senate: 

Millions of individual and business taxpayers owe billions of dollars 
in unpaid federal tax debts--$373 billion as of the end of fiscal year 
2011--and the Internal Revenue Service (IRS) expends substantial 
resources trying to collect these debts. Unlike many other debts owed 
to the federal government, tax debts are not directly reported to 
credit bureaus--companies that collect and sell information about the 
credit history of individuals and businesses. IRS is not allowed to 
directly report tax debt information to credit bureaus because long-
standing federal law protects the privacy of any personally 
identifiable information reported to or developed by IRS.[Footnote 1] 
IRS is, however, allowed to file tax liens on some tax debts, and such 
liens are public record, which can be picked up by credit bureaus and 
included in the credit history information they compile. 

Among the potential reasons for directly reporting tax debt 
information to credit bureaus are the possibility that it could 
increase revenue by encouraging tax debtors to pay off their debts and 
the possibility that it could give the users of credit bureau 
information a more complete picture of the indebtedness of tax 
debtors. A proposal could conceivably encompass all tax debts or 
specify types of tax debts for such reporting. However, the tradeoffs 
that directly reporting tax debts to credits bureaus would entail are 
not well understood, and you asked us to provide information about 
such tradeoffs by applying our recently published guide for assessing 
proposals to authorize disclosures of tax information.[Footnote 2] In 
response to your request, this report describes (1) the inventory of 
tax debts owed to IRS and the characteristics that may be relevant to 
a potential proposal to report tax debts to credit bureaus, such as 
IRS determinations of the likelihood that particular debts may ever be 
collected and the extent to which debts are the subject of tax liens, 
and (2) factors that subject matter specialists believe could be 
useful to consider in the evaluation of any proposal to report tax 
debts to credit bureaus. 

To describe the characteristics of the tax debt inventory, we obtained 
and reviewed data from IRS's Chief Financial Officer Accounts 
Receivable Dollar Inventory Management System and Compliance Data 
Warehouse databases, including information on the amounts, collection 
process status, financial classifications of the debts, and extent to 
which IRS had filed federal tax liens on the debts. We determined that 
the data were sufficiently reliable for our purposes.[Footnote 3] To 
identify factors that subject matter specialists believe could be 
useful to consider in regard to potential tax debt credit bureau 
reporting proposals, we first selected specialists based on their 
government and nongovernment experience in tax policy and 
administration, taxpayer and privacy interests, and the credit 
reporting industry. (See appendix I for the list of the 22 federal 
offices and other parties we contacted.) We then based our discussions 
with these specialists on the questions found in the guide we issued 
in December 2011 to assist policymakers in assessing proposals to 
authorize disclosures of tax information (see appendix II for the list 
of questions in our guide).[Footnote 4] 

We conducted our work from February 2012 to September 2012 in 
accordance with all sections of GAO's Quality Assurance Framework that 
are relevant to our objectives. The framework requires that we plan 
and perform the engagement to obtain sufficient and appropriate 
evidence to meet our stated objectives and to discuss any limitations 
in our work. We believe that the information and data obtained, and 
the analysis conducted, provide a reasonable basis for any findings 
and conclusions in this product. 

Background: 

The inventory of tax debts is comprised of tax assessments that are 
not collected along with related penalty and interest charges. The 
inventory of tax debts and the concept of the tax gap--the difference 
between the tax amounts that taxpayers voluntarily and timely pay and 
those they owe--are related but distinct.[Footnote 5] Key differences 
between the two are summarized in table 1. 

Table 1: Key Differences Between the Tax Debt Inventory and the Tax 
Gap: 

Tax debt inventory: 
* Sum of all tax debts owed to IRS at a particular point in time, 
including debts from the current year and debts from previous years 
that fall within the 10-year statute of limitations on collections; 
Tax gap: 
* Estimate of total tax liability not timely paid for a single year. 

Tax debt inventory: 
* Debts based on known assessments on filed returns or through IRS 
enforcement activities; 
Tax gap: 
* Composed of known assessments as well as estimates of other taxes 
not timely paid that were not identified by IRS through audits or 
other enforcement programs. 

Tax debt inventory: 
* Includes taxes, penalty, and interest; 
Tax gap: 
* Only includes tax. 

Source: GAO. 

[End of table] 

Federal taxes that are owed become tax debts when the tax is assessed 
but not paid. Generally, taxes are either self-assessed by taxpayers 
based on information they report on their tax returns or by IRS 
through its enforcements programs. For example, when a taxpayer files 
a return showing a balance due without a payment to cover it, the self-
assessed tax becomes a tax debt. Alternatively, IRS may determine a 
taxpayer's tax liability through its enforcement programs, such as 
audits and automated comparisons of return information to information 
reported by third parties. Another IRS enforcement program, known as 
the Automated Substitute for Return program, estimates a taxpayer's 
tax liability when a taxpayer has failed to file a return. The 
Automated Substitute for Return program estimates the tax liability 
based on information reported by third parties but does not include 
exemptions or deductions to which the taxpayer may be entitled, so it 
may overstate the amount due. The intent of this estimate is to 
provide incentive for the taxpayer to file an accurate return showing 
the actual tax liability, among other things. To ensure the validity 
of debts and provide due process to taxpayers, enforcement programs 
are required by law to provide a taxpayer with multiple notices and 
opportunity to provide information before the estimates become 
assessed tax debt.[Footnote 6] 

As we have previously reported, IRS has a complex process to attempt 
the collection of tax debts.[Footnote 7] As a first stage, IRS sends a 
series of notices to notify the debtor of the debt owed and to prompt 
payment or other debtor response, such as to dispute the debt or 
request to enter into an installment payment agreement. If the debt is 
not resolved by notices, IRS may then initiate contact with the 
taxpayer by telephone or in-person. After the notice phase, IRS can 
also take enforcement action, such as levying or seizing assets. IRS 
categorizes a tax debt into one of 10 collection process statuses, 
including (1) the debt is in the notice or other collection phases, 
(2) the taxpayer is paying off the debt in installments, (3) IRS has 
suspended active collection efforts, or (4) IRS has determined the 
debt is currently not collectible. Table 2 describes IRS's collection 
process statuses for tax debts. 

Table 2: IRS Collection Process Status Definitions for Tax Debts: 

Collection process status: Notice; 
Definition: The collection phase where IRS sends a series of notices 
of balances due to the taxpayer to, in part, prompt a reply by the 
taxpayer and payment. 

Collection process status: Automated Collection System (ACS); 
Definition: The collection phase where IRS makes telephone contact 
with the taxpayer to secure payment or takes other action, including 
filing a Notice of Federal Tax Lien or enforced collection by levying 
financial assets. 

Collection process status: Queue; 
Definition: In a waiting status for assignment to a revenue officer in 
the Collection Field Function for in-person contact. 

Collection process status: Collection Field Function (CFF); 
Definition: The collection phase where IRS attempts in-person contact 
with the taxpayer to secure payment or takes other action, including 
enforced collection by levying financial assets or seizing property. 

Collection process status: Shelved; 
Definition: Suspended indefinitely from active collection efforts due 
to a lack of IRS resources in ACS and CFF. 

Collection process status: Installment agreement; 
Definition: The taxpayer has agreed to pay the debt in installments. 

Collection process status: Adjustments; 
Definition: Pending due to a taxpayer claim or other inquiries where 
the account is frozen from collection actions for potential 
adjustments to the assessment. 

Collection process status: Currently not collectible (hardship); 
Definition: Have no current collection potential because of the 
taxpayer's economic or financial condition but where future collection 
potential may exist if a taxpayer's financial condition improves. 

Collection process status: Currently not collectible (other); 
Definition: No current collection potential exists and collection is 
unlikely in the future due to taxpayer's financial condition or IRS's 
inability to locate the taxpayer (including cases such cases as 
insolvent or defunct businesses and deceased taxpayers). 

Collection process status: Other; 
Definition: The taxpayer is involved in an administrative or court 
action suspending normal collection action (e.g., bankruptcy, 
insolvency, offers in compromise, and criminal investigations) or 
where the balance is below IRS's established tolerance for active 
collection efforts. 

Source: IRS. 

[End of table] 

If a tax debtor does not pay after IRS's initial contact to collect an 
assessed tax debt, IRS has the authority to protect the government's 
interests by filing a Notice of Federal Tax Lien. A taxpayer must be 
given notice and an opportunity for a hearing when a federal tax lien 
is filed. Such a lien attaches a claim to all of the debtor's 
property, both real and personal, for the amount of unpaid tax, 
including any interest and penalties. Unlike IRS's authority to levy 
or seize assets, a lien does not authorize IRS to take possession of 
an asset or deprive the taxpayer of use of an asset. Instead, a lien 
publicly records the debt owed by the taxpayer as a notice to possible 
future creditors and to establish priority rights against certain 
other creditors that may also hold liens or secured rights against a 
taxpayer's assets. IRS files liens in local recording offices, such as 
courthouses, as determined by the laws of each state. Liens identify 
the taxpayer and the amount owed at the time the lien was filed, but 
do not reflect subsequent changes in the amount owed. A lien may 
prevent tax debtors from selling assets with clear title or obtaining 
additional financing without payment of their tax debts. Circumstances 
do not warrant a lien being filed in all cases, such as when the 
amount of the debt is in dispute or when IRS determines that filing a 
lien would hamper collection of the debt because the debtor is trying 
to obtain a loan to pay it off. However, for cases in which IRS has 
not filed a lien, the government's interest in the tax debtor's 
property is not protected. 

Credit bureaus are companies that collect individual consumer and 
commercial credit information, compile it, and sell credit reports to 
parties legally authorized to obtain such information. The Fair Credit 
Reporting Act (FCRA) governs credit bureaus and the reporting of 
consumer credit information. FCRA details the rights of consumers, and 
puts limits on who may access a credit report and for what 
reasons.[Footnote 8] Credit bureaus also sell credit scores, which are 
calculated based on the information contained in a credit report. 
Lenders rely on credit reports and credit scores when deciding whether 
to offer credit to an individual or business, and at what interest 
rate and other terms. Also, some employers, insurance underwriters, 
and landlords use credit reports to assess applicants' 
creditworthiness. Credit bureaus regularly gather credit information 
from creditors, collection agencies, and public records such as 
records of bankruptcy, foreclosure, garnishments, and other civil 
judgments, as well as publicly available tax lien information 
(federal, state, or local). Federal agencies owed nontax debts are 
among the furnishers of debt information to credit bureaus, in part to 
encourage debtors to pay off their debts.[Footnote 9] 

Of the Overall Billions of Dollars in Federal Tax Debts, Some Debts 
Are Small, Subject to Dispute or Change, Not Considered Collectible, 
or Already Known to Credit Bureaus: 

Evaluation of a proposal to report tax debts to credit bureaus would 
necessarily involve decisions about which particular debts should be 
reported. One key consideration could be whether debts of all sizes 
should be reported, or only those above a certain threshold. To the 
extent that policymakers consider credit bureau reporting to have 
potentially serious negative consequences for taxpayers, they may 
determine that smaller debts do not warrant reporting. If, however, a 
primary purpose of such reporting were to be to provide the users of 
credit bureau information with information about all tax debts, 
smaller debts might be reported along with larger ones. The aggregate 
amount of outstanding tax debt at the end of 2011 was $373.2 billion. 
As shown in figures 1 and 2, tax debts ranged from very small to over 
$100 million. For example, in 2011, 8.3 million individuals and 1.9 
million businesses (well over half of all tax debtors) owed a total of 
$15.7 billion on debts of less than $5,000.[Footnote 10] Fewer 
taxpayers had larger debts but the aggregate amount was larger. For 
debts of $25,000 or greater, 2.1 million taxpayers owed a total of 
$310 billion. 

Figure 1: Tax Debt Inventory in Ranges of Total Debt Owed by an 
Individual, as of the End of Fiscal Year 2011: 

[Refer to PDF for image: horizontal bar graph] 

Individual tax debt: less than $500; 
Number of entities: 2,110,578; 
Total debt owed: $0.5 billion. 

Individual tax debt: $500 to $1,000; 
Number of entities: 1,514,556; 
Total debt owed: $1.1 billion. 

Individual tax debt: $1000 to less than $5,000; 
Number of entities: 4,633,560; 
Total debt owed: $11.8 billion. 

Individual tax debt: $5,000 to less than $10,000; 
Number of entities: 1,909,674; 
Total debt owed: $13.6 billion. 

Individual tax debt: $10,000 to less than $25,000; 
Number of entities: 1,736,731; 
Total debt owed: $27.5 billion. 

Individual tax debt: $25,000 to less than $100,000; 
Number of entities: 1,224,663; 
Total debt owed: $58.6 billion. 

Individual tax debt: $100,000 to less than $500,000; 
Number of entities: 370,657; 
Total debt owed: $72.9 billion. 

Individual tax debt: $500,000 to less than $1 million; 
Number of entities: 32,936; 
Total debt owed: $22.3 billion. 

Individual tax debt: $1 million to less than $10 million; 
Number of entities: 14,762; 
Total debt owed: $30.7 billion. 

Individual tax debt: $10 million to less than $50 million; 
Number of entities: 546; 
Total debt owed: $10.8 billion. 

Individual tax debt: $50 million to less than $100 million; 
Number of entities: 60; 
Total debt owed: $4.0 billion. 

Individual tax debt: $100 million and over; 
Number of entities: 24; 
Total debt owed: $4.5 billion. 

Total: 
Number of entities: 13,548,747; 
Total debt owed: $258.4 billion. 

Source: IRS data. 

Note: Numbers may not add to total due to rounding. 

[End of figure] 

Figure 2: Tax Debt Inventory in Ranges of Total Debt Owed by a 
Business, as of the End of Fiscal Year 2011: 

[Refer to PDF for image: horizontal bar graph] 

Business tax debt: less than $500; 
Number of entities: 788,519; 
Total debt owed: $0.1 billion. 

Business tax debt: $500 to $1,000; 
Number of entities: 337,286; 
Total debt owed: $0.2 billion. 

Business tax debt: $1000 to less than $5,000; 
Number of entities: 793,127; 
Total debt owed: $1.9 billion. 

Business tax debt: $5,000 to less than $10,000; 
Number of entities: 257,652; 
Total debt owed: $1.8 billion. 

Business tax debt: $10,000 to less than $25,000; 
Number of entities: 274,695; 
Total debt owed: $4.4 billion. 

Business tax debt: $25,000 to less than $100,000; 
Number of entities: 273,031; 
Total debt owed: $13.7 billion. 

Business tax debt: $100,000 to less than $500,000; 
Number of entities: 127,632; 
Total debt owed: $26.6 billion. 

Business tax debt: $500,000 to less than $1 million; 
Number of entities: 16,949; 
Total debt owed: $11.7 billion. 

Business tax debt: $1 million to less than $10 million; 
Number of entities: 11,212; 
Total debt owed: $24.9 billion. 

Business tax debt: $10 million to less than $50 million; 
Number of entities: 489; 
Total debt owed: $9.4 billion. 

Business tax debt: $50 million to less than $100 million; 
Number of entities: 68; 
Total debt owed: $4.9 billion. 

Business tax debt: $100 million and over; 
Number of entities: 57; 
Total debt owed: $15.0 billion. 

Total: 
Number of entities: 2,880,717; 
Total debt owed: $114.8 billion. 

Source: IRS data. 

Note: Numbers may not add to total due to rounding. 

[End of figure] 

The status of tax debts would also likely be an important 
consideration. One reason for this is that tax debts in the "notice" 
status are generally still in the phase where IRS is notifying the 
taxpayer of the debt and the taxpayer may respond by disputing the 
validity of the debt, and FCRA prohibits credit bureaus from including 
disputed information in credit reports. To the extent that encouraging 
payment is an important purpose behind a debt reporting proposal, the 
statuses indicating collectibility would also be important. Some 
taxpayers have agreed to installment agreements, so reporting their 
debts may not influence their willingness to pay because they are 
already making payments. IRS classifies other debts as uncollectible, 
and reporting those debts may not make the debts any more collectible. 
On the other hand, if the purpose of a proposal is to have more 
complete information in credit bureau files, both active installment 
agreements and debts considered uncollectible may be worth reporting. 
Table 3 shows the dollar value of debts owed in the different IRS 
collection statuses. 

Table 3: Tax Debt Inventory by Collection Process Status, as of End of 
Fiscal Year 2011: 

Collection process status: Notice; 
Individual tax debts owed: 
Dollars: $16.3 billion; 
Percentage of total individual debt: 6.3%; 
Business tax debts owed: 
Dollars: $5.7 billion; 
Percentage of total business debt: 4.9%; 
Total tax debts owed: 
Dollars: $22.0 billion; 
Percentage of total debt: 5.9%. 

Collection process status: Automated Collection System; 
Individual tax debts owed: 
Dollars: $34.6 billion; 
Percentage of total individual debt: 13.4%; 
Business tax debts owed: 
Dollars: $2.9 billion; 
Percentage of total business debt: 2.5%; 
Total tax debts owed: 
Dollars: $37.5 billion; 
Percentage of total debt: 10.0%. 

Collection process status: Queue; 
Individual tax debts owed: 
Dollars: $56.5 billion; 
Percentage of total individual debt: 21.9%; 
Business tax debts owed: 
Dollars: $10.7 billion; 
Percentage of total business debt: 9.4%; 
Total tax debts owed: 
Dollars: $67.2 billion; 
Percentage of total debt: 18.0%. 

Collection process status: Collection Field Function; 
Individual tax debts owed: 
Dollars: $20.9 billion; 
Percentage of total individual debt: 8.1%; 
Business tax debts owed: 
Dollars: $10.4 billion; 
Percentage of total business debt: 9.0%; 
Total tax debts owed: 
Dollars: $31.2 billion; 
Percentage of total debt: 8.4%. 

Collection process status: Shelved; 
Individual tax debts owed: 
Dollars: $15.4 billion; 
Percentage of total individual debt: 6.0%; 
Business tax debts owed: 
Dollars: $4.9 billion; 
Percentage of total business debt: 4.3%; 
Total tax debts owed: 
Dollars: $20.3 billion; 
Percentage of total debt: 5.5%. 

Collection process status: Installment agreement; 
Individual tax debts owed: 
Dollars: $30.6 billion; 
Percentage of total individual debt: 11.8%; 
Business tax debts owed: 
Dollars: $8.1 billion; 
Percentage of total business debt: 7.1%; 
Total tax debts owed: 
Dollars: $38.7 billion; 
Percentage of total debt: 10.4%. 

Collection process status: Adjustments; 
Individual tax debts owed: 
Dollars: $10.2 billion; 
Percentage of total individual debt: 3.9%; 
Business tax debts owed: 
Dollars: $6.2 billion; 
Percentage of total business debt: 5.4%; 
Total tax debts owed: 
Dollars: $16.4 billion; 
Percentage of total debt: 4.4%. 

Collection process status: Currently not collectible (hardship); 
Individual tax debts owed: 
Dollars: $33.7 billion; 
Percentage of total individual debt: 13.1%; 
Business tax debts owed: 
Dollars: $6.3 billion; 
Percentage of total business debt: 5.4%; 
Total tax debts owed: 
Dollars: $40.0 billion; 
Percentage of total debt: 10.7%. 

Collection process status: Currently not collectible (other); 
Individual tax debts owed: 
Dollars: $22.5 billion; 
Percentage of total individual debt: 8.7%; 
Business tax debts owed:
Dollars: $47.4 billion; 
Percentage of total business debt: 41.3%; 
Total tax debts owed:
Dollars: $69.9 billion; 
Percentage of total debt: 18.7%. 

Collection process status: Other; 
Individual tax debts owed: 
Dollars: $17.6 billion; 
Percentage of total individual debt: 6.8%; 
Business tax debts owed: 
Dollars: $12.3 billion; 
Percentage of total business debt: 10.7%; 
Total tax debts owed: 
Dollars: $29.9 billion; 
Percentage of total debt: 8.0%. 

Collection process status: Total; 
Individual tax debts owed: 
Dollars: $258.4 billion; 
Percentage of total individual debt: 100%; 
Business tax debts owed: 
Dollars: $114.8 billion; 
Percentage of total business debt: 100%; 
Total tax debts owed: 
Dollars: $373.2 billion; 
Percentage of total debt: 100%. 

Source: IRS. 

Note: Totals may not add due to rounding. 

[End of table] 

Another indication of the extent to which tax debts have been 
validated and their collectibility can be found in IRS's financial 
reports. IRS reports on taxes receivable for financial reporting 
purposes, including estimates of how much of the unpaid tax is agreed 
to and collectible. Under federal accounting standards, to be 
considered federal taxes receivable, unpaid assessments must have 
taxpayer or court agreement and have future collection potential. As 
of the end of fiscal year 2011, federal taxes recorded as receivable 
were about $158 billion of the $373 billion owed. The rest of the 
total amount owed included about $98 billion in compliance 
assessments. Compliance assessments are debts that do not have 
taxpayer or court agreements and are made through IRS enforcement 
programs, such as IRS's Automated Substitute for Return program. 
Although not recorded as federal taxes receivable, some of these debts 
may eventually be collected. However, because the debts are estimates 
and may overstate the taxpayer's true liability, they would not be 
appropriate to report to credit bureaus under current law. Also, about 
$117 billion was classified by IRS as write-offs--debts considered to 
have no future collection potential.[Footnote 11] According to IRS 
officials, most debts in the write-off classification are in one of 
the currently not collectible collection statuses. Table 4 presents 
more detail on the amounts of debt owed in each classification using 
available IRS data.[Footnote 12] 

Table 4: Tax Debt Inventory by Financial Reporting Classification, as 
of the End of Fiscal Year 2011: 

Financial reporting classification: Write-offs; 
Individual tax debts owed: $55.3 billion; 
Business tax debts owed: $62.1 billion; 
Total tax debts owed: $117.4 billion. 

Financial reporting classification: Compliance assessments; 
Individual tax debts owed: $85.3 billion; 
Business tax debts owed: $12.6 billion; 
Total tax debts owed: $97.9 billion. 

Financial reporting classification: Federal financial receivables; 
Individual tax debts owed: $117.7 billion; 
Business tax debts owed: $40.2 billion; 
Total tax debts owed: $157.9 billion. 

Financial reporting classification: Total; 
Individual tax debts owed: $258.4 billion; 
Business tax debts owed: $114.8 billion; 
Total tax debts owed: $373.2 billion[A]. 

Source: IRS data. 

Note: Numbers may not add to total due to rounding. 

[A] The amount of total tax debts includes duplicate assessments. 
Duplicate assessments are assessed against multiple parties to protect 
the government's interest, but can be collected only once. While these 
debts are included in IRS's unpaid tax debt inventory, IRS does not 
include them on its financial statements. 

[End of table] 

Another debt inventory characteristic that may be relevant to a 
proposal to report tax debts to credit bureaus is the extent to which 
information about tax debts is already known to credit bureaus because 
of tax liens. Lien filing is not necessarily incompatible with IRS 
directly reporting information about tax debts to credit bureaus, but 
policymakers may want to consider whether liens, which are public 
records that credit bureaus pick up, are already doing much of what 
direct reporting of debts might do. Table 5 shows the extent of lien 
coverage for debts in each collection status. As shown in the table, 
liens have been filed on over half of all of the dollars owed in tax 
debts; liens are generally not filed until after the debt has moved 
out of the notice status. 

Table 5: Tax Debt Inventory for Individuals and Businesses for Which 
Liens Had or Had Not Been Filed by Collection Process Status, as of 
the End of Fiscal Year 2011: 

Collection process status: Notice; 
Individual and business tax debts: 
Total liens filed: $1.5 billion; 
Total liens not filed: $20.5 billion; 
Total: $22.0 billion. 

Collection process status: Automated Collection System; 
Individual and business tax debts: 
Total liens filed: $13.8 billion; 
Total liens not filed: $23.7 billion; 
Total: $37.5 billion. 

Collection process status: Queue; 
Individual and business tax debts: 
Total liens filed: $37.3 billion; 
Total liens not filed: $29.9 billion; 
Total: $67.2 billion. 

Collection process status: Collection Field Function; 
Individual and business tax debts: 
Total liens filed: $24.6 billion; 
Total liens not filed: $6.6 billion; 
Total: $31.2 billion. 

Collection process status: Shelved; 
Individual and business tax debts: 
Total liens filed: $10.3 billion; 
Total liens not filed: $10.0 billion; 
Total: $20.3 billion. 

Collection process status: Installment agreement; 
Individual and business tax debts: 
Total liens filed: $14.3 billion; 
Total liens not filed: $24.4 billion; 
Total: $38.7 billion. 

Collection process status: Adjustments; 
Individual and business tax debts: 
Total liens filed: $6.0 billion; 
Total liens not filed: $10.4 billion; 
Total: $16.4 billion. 

Collection process status: Currently not collectible (hardship); 
Individual and business tax debts: 
Total liens filed: $35.6 billion; 
Total liens not filed: $4.4 billion; 
Total: $40.0 billion. 

Collection process status: Currently not collectible (other); 
Individual and business tax debts: 
Total liens filed: $52.9 billion; 
Total liens not filed: $17.0 billion; 
Total: $69.9 billion. 

Collection process status: Other; 
Individual and business tax debts: 
Total liens filed: $14.6 billion; 
Total liens not filed: $15.3 billion; 
Total: $29.9 billion. 

Collection process status: Total; 
Individual and business tax debts: 
Total liens filed: $210.9 billion; 
Total liens not filed: $162.3 billion; 
Total: $373.2 billion. 

Source: IRS data. 

Note: Totals may not add due to rounding. 

[End of table] 

Experts Suggested That Data Accuracy, Alternatives, and Expected 
Benefits Are among the Important Factors to Consider: 

Subject matter specialists offered insights and comments about 
important factors to consider should policymakers decide to develop or 
evaluate a proposal to directly report unpaid federal tax debts to 
credit bureaus. Important observations raised in our discussions 
include the following: 

* A proposal to report tax debts to credit bureaus would need to be 
clear about the specific information about taxpayers and their debts 
that would be reported. Information about individual consumers that is 
furnished to credit bureaus is typically transmitted in an industry-
standard format and includes sufficient identifying data such that the 
information can be associated with the right person. 

* Federal agencies currently report nontax debts to five designated 
nationwide credit bureaus. This could be a likely approach under a tax 
debt reporting proposal, but Congress could consider other 
alternatives. We limited our discussions to policy scenarios wherein 
credit bureaus would incorporate and use tax debt information from IRS 
consistent with current practice for debt information reported by 
other federal agencies and private creditors. This would mean that 
credit bureaus would redisclose the information to other entities 
consistent with current legal requirements regarding consumer debt 
contained in FCRA. 

* Specifying the purpose of a privacy exception proposal and 
estimating the associated expected benefits are important 
considerations. Among the possible expected benefits that some 
specialists identified were (1) giving tax debtors an incentive to pay 
their tax debts and (2) encouraging taxpayers in general to stay out 
of debt in the first place. Another possible benefit identified by the 
experts was having more complete credit history information available 
to entities that currently are allowed to use credit bureau 
information, including government entities, for improved lending or 
other business decisions. Some other possible benefits that came up in 
our discussions and our review of Treasury Financial Management 
Service guidelines were (1) enhanced tax enforcement capability by 
barring parties owing selected thresholds of federal taxes from 
receiving certain benefits, such as contracts, grants, or loans, and 
(2) better protection against loan applicants taking on new debts when 
they are already unable to pay their existing debts. 

* Some subject matter specialists we spoke to said it would be 
important to consider a proposal to report tax debts directly to 
credit bureaus in light of the alternative present in IRS's current 
use of tax liens, which are already known to credit bureaus. Credit 
bureau officials noted that only the initial dollar amount of the tax 
debt that is the subject of the lien and the identity of the debtor 
are publicly reported and picked up and included in credit bureau 
files. Changes in tax debts over time, such as if a tax debt grows 
(because of penalties and interest) or is reduced (because the debtor 
pays IRS some of what is owed), are not included with tax liens or 
known to credit bureaus. For this reason, direct reporting could 
involve more current information than what is available from tax liens 
and provide an incentive to taxpayers to pay down their debts because 
their declining balance due would be reflected on their credit 
histories. On the other hand, some subject matter specialists noted 
that direct reporting of tax debts to credit bureaus along with lien 
filings would increase the risk of reporting duplicative negative 
information on a taxpayer's credit report. 

* Any reporting will necessarily involve costs. It is possible that a 
higher volume of reporting (in terms of either the number of debts 
being reported or the frequency of reporting) will result in higher 
costs, but the mix of fixed and variable costs could mean that the 
cost per report decreases with higher volume. Costs to IRS would 
likely include start-up and recurring information system costs, 
including devoting additional staff to manage the transmission of 
information and deal with taxpayers' disputes, inquiries, and other 
activities resulting from debts reported. Such costs could mean IRS 
would have to reallocate resources from collections operations or 
other areas. However, credit bureau reporting may enhance the 
efficiency of IRS collections, to the extent that such reporting 
obviates the need for more costly debt collection tools. Costs to IRS 
would also be affected by how a proposal assigns IRS's 
responsibilities for accounting for disclosures and providing 
oversight to ensure that taxpayer information is safeguarded by credit 
bureaus. 

* Several specialists we talked to stressed that the accuracy of any 
information reported to credit bureaus is of paramount importance. 
They said if inaccurate data are provided to credit bureaus, this 
would impose burdens on taxpayers and IRS. Taxpayers would be forced 
to either dispute the inaccurate information to have it corrected or 
face possible serious consequences such as denial of credit, 
employment, or housing due to the inaccurate negative information on 
their credit histories. IRS would incur additional costs as it would 
have to respond to related inquiries and disputes. Our 2011 audit of 
IRS's financial statements found that IRS experienced errors and 
delays in recording taxpayer information, payments and other tax 
assessment related activities.[Footnote 13] Subject matter specialists 
commented that to help ensure that a reported tax debt is valid, IRS 
would need to ensure that taxpayers are provided opportunities to 
dispute tax assessments before reporting debts to credit bureaus. 
[Footnote 14] Also, under FCRA, should policymakers choose to apply 
it, there could be financial liability for IRS associated with 
reporting debt information inaccurately. 

* The frequency of reporting is another important consideration as it 
would have implications for the currency and accuracy of data. Credit 
bureau officials told us that many data furnishers report information 
monthly, but others report information only when something changes. 
FCRA requires that furnishers of information update information on a 
regular basis, but does not specify the timing for such reporting. 
Credit bureau and financial industry representatives observed that 
regular reporting of tax debts by IRS would mean that the bureaus 
would have more up-to-date information than what is currently 
available from filed tax liens and data about debts for which liens 
have not been filed. 

* Amending section 6103 of the Internal Revenue Code in order to 
authorize disclosure of tax information to credit bureaus may not be 
the only change needed to implement a debt reporting proposal. 
Potential statutes likely to be included in consideration of legal 
implications include FCRA, the Debt Collection Improvement Act, 
Freedom of Information Act, and Privacy Act. Discussions with 
officials from federal agencies that report nontax debts to credit 
bureaus suggest that, while there would be costs associated with any 
IRS tax debt reporting, there are not specific obstacles that would 
prevent such reporting. 

* Subject matter specialists offered differing perspectives on the 
effect that directly reporting tax debt information would have on 
privacy. Some specialists said that reporting tax debts to credit 
bureaus would be significantly different from other disclosures of 
federal tax information. Current authorizations to disclose tax 
information generally are to government agencies for tax and other 
limited, specific uses by the government. In contrast, reporting tax 
debts to credit bureaus would involve disclosure of federal tax 
information to private sector companies. However, some specialists 
also noted that some tax debts are already subject to public 
disclosure in the notice of federal tax lien, and that credit bureaus 
routinely identify and report the information from such notices. 

* Experts observed that policymakers may wish to consider applying the 
requirements of FCRA to a tax debt reporting program, as doing so 
could address concerns about giving taxpayers the opportunity to 
dispute negative information and ensuring transparent and limited use 
of information about them. Policymakers may also wish to consider 
applying the requirements of the Debt Collection Improvement Act, 
which governs debt reporting by other federal agencies and gives 
taxpayers the opportunity to dispute negative information about nontax 
federal debts before a federal agency reports it. Several specialists 
stressed the importance of IRS having an effective process for giving 
taxpayers adequate notice before information is reported and for 
timely response and resolution of taxpayers' inquiries or disputes. 
Notice, access, and correction opportunities could be addressed by 
incorporating those concepts into existing IRS procedures or possibly 
developing new procedures. 

* Most IRS disclosures of federal tax information include strict 
requirements to prevent subsequent redisclosure of the federal tax 
information, but reporting tax debts to credit bureaus would be 
different. Inherent in any likely proposal to report tax debt 
information to credit bureaus would be the understanding that the 
information would be redisclosed to other parties as permitted by 
federal law.[Footnote 15] Some specialists noted that once credit 
bureau information is redisclosed, it is less subject to controls on 
its use and more open to possible misuse. They noted that this would 
be a very serious consideration in light of the high level of 
protection typically given to federal tax information and taxpayers' 
expectation that information about them will be protected by IRS. 
However, some specialists also noted that information about many tax 
debts is already made public through tax liens and available in credit 
bureau files. 

* Some specialists suggested the possibility that the threat of credit 
bureau reporting could increase compliance because people would seek 
to avoid incurring reportable debts or hurry to pay off their existing 
debts to improve their credit scores. The National Taxpayer Advocate, 
however, suggested that any proposal should be evaluated in light of 
the possibility that reporting tax debts to credit bureaus may result 
in some people choosing to not file or file inaccurately if they know 
they owe money to IRS.[Footnote 16] 

* Finally, experts observed that experience with tax liens may provide 
a useful analogue for considering potential effects of direct tax debt 
reporting on voluntary compliance. Studies by IRS and the Taxpayer 
Advocate have revealed desired and undesired compliance effects of 
liens in some cases. For example, the Taxpayer Advocate Service has 
conducted research that raises concerns about potential negative 
effects associated with liens. A 2011 study found that lien filing was 
associated with declines in taxpayers' compliance and reported 
income.[Footnote 17] In the years studied, taxpayers subject to liens 
were less likely to reduce their initial tax debt, file required 
returns, and have increased income than other similarly situated 
taxpayers without liens filed. However, the study also found lien 
filing was associated with better payment compliance behavior among 
these same taxpayers in subsequent years. IRS studies have also found 
that liens had positive compliance effects for cases studied, such as 
increasing the likelihood that a collection case would be resolved if 
a lien is filed sooner. 

Agency Comments: 

The IRS provided technical comments after viewing a draft of this 
report, which we incorporated as appropriate. 

As agreed with your offices, unless you publicly announce the contents 
of this report earlier, we plan no further distribution until 30 days 
from the report date. At that time, we will send copies to interested 
congressional committees, Secretary of the Treasury, Commissioner of 
Internal Revenue, and other interested parties. In addition, the 
report will be available at no charge on the GAO website at 
[hyperlink, http://www.gao.gov]. 

If you have any questions about this report, please contact me at 
(202) 512-9110 or whitej@gao.gov. Contact points for our Offices of 
Congressional Relations and Public Affairs may be found on the last 
page of this report. Key contributors to this guide are listed in 
appendix III. 

Signed by: 

James R. White, Director: 
Tax Issues: 
Strategic Issues: 

[End of section] 

Appendix I: External Parties Contacted: 

Tax policy and tax administration: 

* Office of Tax Policy, Department of the Treasury: 

* Internal Revenue Service: 

Reporting nontax debts to credit bureaus: 

* Financial Management Service, Department of the Treasury: 

* Department of Education: 

* Small Business Administration: 

Regulating credit bureaus: 

* Federal Trade Commission: 

* Consumer Financial Protection Bureau: 

Taxpayer and practitioner interests: 

* National Taxpayer Advocate: 

* American Institute of Certified Public Accountants: 

* National Association of Tax Professionals: 

Privacy interests: 

* American Civil Liberties Union: 

* Center for Democracy & Technology: 

* Robert Gellman, Information Policy and Privacy Consultant: 

Credit bureaus and credit reporting: 

* Equifax: 

* Experian: 

* TransUnion: 

* Innovis: 

* Dun & Bradstreet: 

* FICO: 

* Consumer Data Industry Association: 

Financial business concerns: 

* Financial Services Roundtable: 

* American Bankers Association: 

[End of section] 

Appendix II: List of Threshold and Policy Factor Questions and 
Subquestions That Guided Our Discussions with Subject Matter 
Specialists: 

Threshold questions: 

1. Does the proposal have a clear purpose and description of how the 
tax information will be used? 

* What specific information will be disclosed? 

* To whom will the information be disclosed? 

* What category or categories of taxpayers will be affected? 

* How will the information be used? 

* What purpose will be achieved? 

2. Does the proposal consider reasonable alternatives? 

3. Is the tax information accurate, complete, and current enough for 
the stated purpose? 

4. Is the tax information to be disclosed relevant and the minimum 
needed to achieve the stated purpose? 

5. Does the proposal address any other statutory, regulatory, or 
logistical issues necessary for its implementation? 

* Will the proposal require additional legislation besides modifying 
section 6103 to accomplish the desired result? 

* Does the proposal conflict with existing regulations, rules, or 
statutes other than section 6103? 

* How will any logistical or practical barriers or hindrances to 
implementing the proposed disclosure and use of information for the 
stated purpose be resolved? 

Policy factor questions: 

Expected benefits and costs: 

1. What are the expected benefits of the proposal to disclose tax 
information? 

* What are the estimated financial benefits, if any, to be achieved by 
using tax data? 

* What are the nonfinancial benefits that are expected, if any? 

2. What are the expected costs of obtaining and using the tax 
information to be disclosed? 

* What are the estimated costs for IRS to provide the tax data? 

* What are the estimated costs to the entity receiving the information? 

* What are the expected costs for others affected by the tax-
disclosure proposal? 

Privacy effect and safeguards: 

3. What is the potential effect on privacy? 

* To what extent will the proposal adversely affect taxpayer privacy? 

* Is the use of the information transparent and limited? 

* Will sufficient notice and control be provided to individuals? 

4. What risks of improper use or unauthorized disclosure does the 
proposal create and how well does the proposal address those risks? 

* Does the proposal adequately take into account risks of unauthorized 
use or redisclosure associated with the disclosure? 

* Does the proposal provide adequate safeguards to mitigate those 
risks? 

Effects on the tax system: 

5. What is the potential effect on voluntary taxpayer compliance? 

* What is the potential effect on voluntary compliance by taxpayers 
whose tax information will be disclosed? 

* What is the potential effect on general voluntary compliance for 
other taxpayers? 

6. What is the potential effect on tax administration? 

* How much will implementing the proposal affect current IRS 
activities or performance? 

* How much will any related safeguard responsibilities add to IRS's 
current responsibilities? 

[End of section] 

Appendix III: GAO Contact and Staff Acknowledgments: 

GAO Contact: 

James R. White, (202) 512-9110 or whitej@gao.gov: 

Staff Acknowledgments: 

In addition to the contact named above, David Lewis, Assistant 
Director; Ronald W. Jones, Analyst-in-Charge; Ellen Rominger; Cynthia 
Saunders; and Sabrina Streagle made key contributions to this report. 

[End of section] 

Footnotes: 

[1] This information, which is known as federal tax information, can 
be disclosed only in limited circumstances specified in 26 U.S.C. § 
6103. 

[2] GAO, Taxpayer Privacy: A Guide for Screening and Assessing 
Proposals to Disclose Confidential Tax Information to Specific Parties 
for Specific Purposes, [hyperlink, 
http://www.gao.gov/products/GAO-12-231SP] (Washington, D.C.: Dec. 14, 
2011). 

[3] To assess reliability we reviewed such information as on IRS's 
data collection and quality control procedures for the IRS Chief 
Financial Officer Accounts Receivable Dollar Inventory Management 
System and Compliance Data Warehouse databases and inquired how IRS 
queried the databases to assure accuracy. In addition, we compared the 
unpaid assessments data with data we audited as reported in Financial 
Audit: IRS's Fiscal Years 2011 and 2010 Financial Statements, 
[hyperlink, http://www.gao.gov/products/GAO-12-165] (Washington, D.C.: 
Nov. 10, 2011). 

[4] [hyperlink, http://www.gao.gov/products/GAO-12-231SP]. 

[5] In January 2012, IRS estimated that the gross tax gap--the 
difference between taxes owed and taxes paid on time--was $450 billion 
in tax year 2006. IRS estimated that it would eventually recover about 
$65 billion of this amount through late payments and enforcement 
actions, leaving a net tax gap of $385 billion. 

[6] For example, the taxpayer has 90 days after receipt of a notice of 
deficiency (150 days if the taxpayer lives outside the United States) 
to file a petition with the Tax Court for a redetermination of the 
deficiency. The deficiency may not be assessed until the expiration of 
the 90-day period if no appeal is filed, or until the decision of the 
Tax Court has become final. 

[7] GAO, Tax Debt Collection: IRS Has a Complex Process to Attempt to 
Collect Billions of Dollars in Unpaid Tax Debts, [hyperlink, 
http://www.gao.gov/products/GAO-08-728] (Washington, D.C.: June 13, 
2008). 

[8] FCRA, 15 U.S.C. § 1681 - 1681x, applies only to consumer reporting 
and does not apply to commercial credit reporting. FCRA provides 
consumers with rights and protections, including the right to be told 
if information in a consumer report has been used to take adverse 
action against a consumer; to see the contents of the report; to 
dispute inaccurate or incomplete information with the credit bureau; 
to have inaccurate information corrected or deleted; to dispute 
inaccurate items with the furnisher or source of the information; and 
to have outdated information excluded from a consumer report. FCRA 
also puts limitations on access to consumer reports, including a 
requirement for consumer consent to furnish reports to employers or to 
furnish reports containing medical information. 

[9] The Debt Collection Improvement Act of 1996, Pub. L. No. 104-134, 
§ 31001,110 Stat. 1321 (Apr. 26, 1996), as codified at 31 U.S.C. § 
3711(e) requires federal agencies to report information on all 
delinquent federal consumer debts to credit bureaus. Federal agencies 
have been required, as a matter of policy, to report all (current and 
delinquent) commercial debts since September 1983. 

[10] The data presented for individuals and businesses are from, 
respectively, IRS's Individual Master File and Business Master File 
databases. The Individual Master File data include some taxes based on 
business income (such as when a taxpayer is self-employed) and the 
Business Master File data include some taxes on individuals (for 
example, estate and gift taxes). 

[11] The balance in the write-off classification includes "memo" 
balances, which includes amounts owed by federal government agencies 
and assessments recorded based on fraudulent or frivolous tax returns. 
While these debts are included in IRS's unpaid assessments inventory, 
IRS does not include them on its financial statements. 

[12] For purposes of comparison with other data in this report the 
data presented in this table are from IRS's unadjusted data, and 
therefore do not match amounts IRS reports in its fiscal year 2011 
financial statements. We have determined that IRS's systems cannot 
classify its unpaid assessments inventory for financial reporting 
without material inaccuracies. As a result, IRS uses a statistical 
estimation process to adjust for errors, misclassifications, and 
duplicate assessments in its systems. These adjustments are made to 
aggregate-level summary data rather than to the raw data. As we 
reported in our most recent audit of IRS financial statements (see 
hyperlink, http://www.gao.gov/products/GAO-12-165), after such 
adjustments, as of the end of fiscal year 2011, unpaid tax debts (to 
include debts in IRS master files for individual and businesses as 
well as other debts) totaled $356 billion, consisting of $103 billion 
in compliance assessments, $106 billion in write-offs, and $147 
billion in gross taxes receivable; after an allowance for 
uncollectible taxes receivable ($112 billion), net taxes receivable 
was $35 billion. 

[13] [hyperlink, http://www.gao.gov/products/GAO-12-165]. 

[14] Before filing a tax lien, IRS procedures gives taxpayers notice 
of the amount of the debt and opportunity to dispute it. 

[15] Credit bureaus are required by FCRA to protect the consumer 
information they maintain from unauthorized disclosures or uses not 
allowed by federal law. 

[16] The National Taxpayer Advocate is appointed by the Secretary of 
the Treasury and reports to the Commissioner of Internal Revenue. The 
Taxpayer Advocate presents an independent taxpayer perspective that 
does not necessarily reflect the position of the IRS, the Treasury 
Department, or the Office of Management and Budget. 

[17] National Taxpayer Advocate, "Estimating the Impact of Liens on 
Taxpayer Compliance Behavior and Income," 2011 Annual Report to 
Congress, Volume Two: TAS Research and Related Studies, (Dec.31, 2011) 
p. 94. 

[End of section] 

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