Letter 3230C, Third Party Contact Letter, is the advance notice the IRS must give before contacting people other than you about your collection case. Under IRC Section 7602(c), the IRS generally cannot contact your employer, bank, customers, neighbors, or other third parties about your tax debt without telling you first.
The Notice Period
The Taxpayer First Act tightened this rule. The notice must generally be given at least 45 days before the first contact, and it applies to contacts made within the following year. That 45-day window is your chance to provide the information yourself instead of having the IRS go around you.
Why It Matters
Third-party contacts are how the IRS verifies income, finds assets, and identifies levy sources. A call to your employer or a key customer can be embarrassing and can damage business relationships. Contacting the revenue officer or collection unit first and providing a complete financial statement often makes the contacts unnecessary.
Your Rights
You can ask the IRS for a list of third parties it contacted. Exceptions to the notice rule exist, including jeopardy situations and cases where notice could lead to reprisal against the person contacted.
If you received Letter 3230C, call us at (813) 229-7100. Getting ahead of the contacts usually works better than reacting to them.