By Amy Lee Rosen

Law360 (April 7, 2020, 3:59 PM EDT) -- The IRS should clarify whether high-income earners are included in a recent partial suspension of collection and enforcement activities in response to the novel coronavirus, the American Bar Association Section of Taxation has said in a letter.

The Internal Revenue Service should provide more details on pledges made in March under its People First Initiative to generally not begin new audits or private debt collections until at least July 15 due to the coronavirus outbreak, the ABA Section of Taxation said in a Monday comment letter to the agency.

The IRS said in March that field revenue officers would continue to pursue high-income nonfilers, but there is still confusion about whether enforcement and collection activities have been suspended against all taxpayers or whether wealthy nonfilers are excepted, the letter said.

"We request guidance with respect to whether the People First Initiative also applies to 'high income' taxpayers," the group said.

In February the IRS announced it planned to send dozens of revenue officers to knock on the doors of high-income people who failed to file a tax return in a tax year. However, the People First Initiative does not define "high-income nonfiler," though the government has previously indicated it generally means someone with income exceeding $100,000, the ABA letter said. A clearer definition would help the public and agency personnel understand to whom the suspension applies, it said.

The group also asked that additional relief be extended to other affected groups, since there has been widespread disruption in commercial activities due to the coronavirus pandemic and because it has been harder to reach IRS employees due to staffing limitations, the letter said.

For example, the People First Initiative says new systemic liens and levies, as well as liens and levies initiated by field revenue offices, will be suspended until July 15, but the government also noted it would pursue levies, liens and seizures "where warranted," the letter said. That suspension should be broadened, it said, because some people may not be able to leave their homes to mail timely collection due process requests in response to tax bills or notices of federal tax liens.

The group also requested the IRS consider increasing the threshold for lien filing to $25,000 or even $50,000 from $10,000 so that liens would be less likely to fall on those with smaller tax balances. Increasing the threshold would still let the IRS protect itself against people who have significant tax liabilities, the letter said.

"We note that because the Tax Court is closed, taxpayer petitions for redetermination of collection actions after [collection due process] appeals and requests for innocent spouse relief will not be processed," according to the ABA Section of Taxation. "Raising the threshold for recording [notices of federal tax liens] will reduce the backlog of petitions and it is also an equitable response to taxpayers' inability to access judicial review."

The People First Initiative also does not clarify how the IRS will treat existing tax levies and garnishments, the letter said.

Lawrence A. Sannicandro, a tax associate at McCarter & English LLP who was principally responsible for preparing the comments, told Law360 Tuesday he had not received a response from the IRS or from the U.S. Department of the Treasury. Sannicandro serves as the chair of the tax section's committee on tax collection, bankruptcy and workouts.

--Additional reporting by Dylan Moroses and David van den Berg. Editing by Robert Rudinger.

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