If your business or corporation has changed addresses in the past few years, are you certain the IRS was notified about your new address? If you’re not certain, you should check, or you could find yourself in an awkward situation if you’re ever involved in an IRS tax controversy. As a recent ruling by the U.S. Tax Court underscores, you could lose your right to challenge a federal tax lien if you missed the notification when it was misaddressed.

What caused the mess in the case at issue was something it would be very easy for a small business owner to overlook. An entrepreneur moved his small business into his home and rented a P.O. box. Initially, everything was fine, and the IRS was aware of the P.O. address. When he gave up the P.O. box, however, he didn’t file a change of address form with the post office. Instead, he requested any mail sent to the P.O. box be forwarded to his home address.

Almost a year later, the IRS sent a proposed tax assessment letter to the P.O. box, which was dutifully forwarded to the taxpayer’s home. However, the taxpayer apparently didn’t notice the letter. Not having received a response, the IRS filed a tax lien. The business owner claimed that he hadn’t received proper notice of the tax controversy because the letter had been delivered to the P.O. box and he hadn’t actually received it.

Unfortunately for the business owner, the Tax Court ruled that the IRS is only required to send the notice to the taxpayer’s last known address, which it did. Proof he actually received the IRS’s letter was not required for the service to be considered proper.

The important point for Kentucky small businesses and corporations is this: it’s up to you to keep taxing authorities informed of your business’s current address. You can do this by filling out a change of address card, as opposed to a forwarding request, with the post office. However, since you’re not directly notifying the IRS, there could be a delay that could result in misdelivered mail. The most certain method is to notify the IRS directly by filing a Form 8822-B.

Source: Business Management Daily, "Moving? Remember to tell IRS," Payroll Legal Alert, July 18, 2013