Taxpayer Rights in New Jersey

NJ taxpayers are protected by both the federal Taxpayer Bill of Rights (TBOR), which governs all interactions with the IRS, and New Jersey state law, which provides additional protections when dealing with the NJ Division of Taxation. These rights are not optional courtesies: they are legally enforceable protections that the IRS and NJ tax authorities must respect. Knowing your rights changes how you interact with tax authorities, from audits to collections to appeals.

The IRS Taxpayer Bill of Rights (Federal)

The IRS formally adopted the Taxpayer Bill of Rights in 2014, codifying 10 fundamental rights that apply to every taxpayer in every state, including New Jersey:

1. The Right to Be Informed

You have the right to know what you need to do to comply with tax laws. The IRS must provide clear explanations of its decisions and must tell you about your rights at each stage of the process.

2. The Right to Quality Service

You have the right to prompt, courteous, and professional assistance from the IRS. If you receive inadequate service, you can contact the Taxpayer Advocate Service.

3. The Right to Pay No More Than the Correct Amount

You only owe what is legally due, including penalties and interest. If the IRS has assessed more than you owe (common with Substitute for Returns), you have the right to file your own return and reduce the assessment.

4. The Right to Challenge the IRS Position and Be Heard

You can raise objections to IRS actions, provide documentation, and expect the IRS to consider your position. This includes audit findings, penalty assessments, and collection decisions.

5. The Right to Appeal an IRS Decision in an Independent Forum

You can appeal most IRS decisions to the IRS Office of Appeals, which operates independently from the examination and collection divisions. If you disagree with Appeals, you can petition the U.S. Tax Court.

6. The Right to Finality

You have the right to know the maximum time to challenge the IRS position and the maximum time the IRS has to audit a particular year or collect a tax debt. The 10-year CSED and the 3-year audit statute are examples of finality protections.

7. The Right to Privacy

IRS investigations and collection actions must be no more intrusive than necessary. The IRS cannot use enforcement actions beyond what is required to collect the tax owed.

8. The Right to Confidentiality

Your tax information is confidential. The IRS cannot disclose your tax data to third parties except as authorized by law (such as sharing with state tax agencies under information-sharing agreements).

9. The Right to Retain Representation

You have the right to hire an Enrolled Agent, CPA, or tax attorney to represent you before the IRS. Your representative can handle all communications, attend meetings, and negotiate on your behalf. With a valid Power of Attorney (Form 2848), you do not need to be present.

10. The Right to a Fair and Just Tax System

You have the right to receive assistance from the Taxpayer Advocate Service if the IRS is not resolving your issue through normal channels, and to expect the system to consider your individual facts and circumstances.

Key Procedural Rights for NJ Taxpayers

Beyond the TBOR, specific procedural rights protect NJ taxpayers during IRS collection:

Collection Due Process (CDP) hearing: When the IRS files a Notice of Federal Tax Lien or sends a Final Notice of Intent to Levy, you have 30 days to request a CDP hearing. During the hearing, an independent Appeals officer reviews whether the proposed collection action is appropriate and considers alternative resolutions. Levy activity is suspended during the hearing.

Equivalent Hearing: If you miss the 30-day CDP deadline, you can request an Equivalent Hearing within one year. This does not suspend collection, but it provides a forum to present your case.

Innocent Spouse Relief: If your spouse (or former spouse) caused a tax understatement, you may qualify for relief under IRC Section 6015. This is particularly relevant in NJ divorce situations where one spouse was unaware of the other's tax issues.

Penalty abatement rights: You can request removal of penalties for reasonable cause (illness, disaster, reliance on bad advice) or through First Time Penalty Abatement if you have a clean compliance history.

NJ State Taxpayer Rights

The NJ Division of Taxation provides additional protections under state law:

Right to information: The NJ Division must provide clear explanations of state tax laws, your obligations, and the basis for any assessment.

Right to representation: You can be represented by a qualified professional during NJ state tax proceedings.

Right to appeal: You can contest NJ state tax assessments by filing a protest with the Division of Taxation's Conference and Appeals Branch. If unresolved, you can appeal to the NJ Tax Court.

Right to privacy: NJ tax return information is confidential under state law.

Right to installment payments: The NJ Division offers payment plans for taxpayers who cannot pay in full.

Right to penalty abatement: NJ allows penalty waiver for reasonable cause, similar to the federal process.

The Taxpayer Advocate Service (TAS)

The TAS is your safety net when normal IRS processes fail. Contact the TAS when:

• The IRS is causing you immediate economic hardship through collection actions
• You have not received a response from the IRS within normal timeframes
• An IRS system or procedure is not working as intended
• You believe the IRS is not following the law or your rights are being violated

The TAS assigns a dedicated case advocate who works your issue until it is resolved. NJ taxpayers can reach the local TAS office through the national hotline at 877-777-4778.

Protecting Your Rights During IRS Contact

Practical steps for NJ taxpayers when the IRS contacts you:

1. Verify the contact is legitimate. The IRS initiates most contacts by mail, not phone. If someone calls claiming to be the IRS and demands immediate payment by gift card or wire transfer, it is a scam.
2. Read every notice carefully. IRS notices include deadlines for response. Missing a deadline can cost you appeal rights.
3. Respond within stated timeframes. CDP hearings must be requested within 30 days. Audit responses have specific deadlines. Mark these dates immediately.
4. Exercise your right to representation. You do not have to speak with the IRS directly. An enrolled agent for New Jersey taxpayers can handle all communications.
5. Keep copies of everything. Document all IRS correspondence, phone calls (date, time, representative ID number), and submissions.

Get Help Protecting Your Rights

Jennifer O'Neill, EA, MBA, at IRS Help Inc. has advocated for NJ taxpayer rights since 1982. Her BBB-accredited firm ensures the IRS follows proper procedures, respects your rights, and considers all available resolution options before taking enforcement action. As an NJ tax debt specialist, she represents clients through every stage of the IRS process.

Contact IRS Help Inc. at 1-800-477-4357 to discuss your situation and protect your rights.

Related Questions

Can the IRS violate my rights?

Unfortunately, yes, though it is not common. If you believe the IRS has violated your rights, document the incident and contact the Taxpayer Advocate Service. You may also have grounds for a civil action under IRC Section 7433 if the IRS recklessly or intentionally disregards the tax code during collection.

Do I have to talk to an IRS Revenue Officer who comes to my NJ home?

You are not required to answer questions or let the Revenue Officer inside. You can politely state that you prefer to communicate through your representative and provide your representative's contact information. Exercise your right to representation.

Can the NJ Division of Taxation garnish my wages without notice?

NJ state law requires notice before wage garnishment for state taxes. However, the notice requirements and timelines differ from the federal process. If you receive a NJ state garnishment notice, respond promptly and consider seeking professional help.

Learn more about your New Jersey tax relief options and the IRS Fresh Start Program in NJ. For NJ taxpayers also dealing with NYC tax issues, Anil Melwani of 212 Tax handles cross-state disputes. See also: IRS audit defense in NJ.