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This has to be done by phone and immediately. The client is having 85% of his paycheck garnished each time. Responding to IRS letters takes 90 days to get a reply.. When I get a case like this, I call and get a 60 day full pay hold. That lifts the levy immediately and gives you time to resolve the issue.

Not my client base at all. Mine are more apt to send their things in as late as possible! I do have one business client who gets documents in around January 2 or 3 each year, which I like. I always have to hold off on e-filing, but it is what it is.

I think you recaptured a credit in the past (as a credit is a reduction in tax not a reduction in income). Ok, you caught that. The Instructions for Form 8863 talk about it on page 5. On the 2018 forms (grrrrr), you'd go to Form 1040, p. 2, Line 11a. Right click it and there's a worksheet. The recaptured credit goes on line 8 of the worksheet. Should print "ECR" to the left of Line 11, if I recall.

First, you have to find out what is going on here, as 2007 should have passed the statue date (CSED)10 years and a day from the last assessment and any liens should have been removed within 30 days after that. The first step is to call the Practitioner Priority Line (PPL) ( you will need form 2848, or, if you are not an EA or CPA, form 8821.) Then call PPL and tell them what your client is experiencing. It is possible the 2007 account was improperly flagged to expire. PPL can usually fix those things. I just had something similar happen with one of my clients. Four years were wrongly flagged to have form 940 filed. PPL fixed that. PPL can also tell you whether the appropriate collection letters were sent to your client. You should also ask them to fax you the Account Transcript for 2007. It may take time for the flag removal to work its way through the system, so I would prepare form 433F and call ACS. The form is a Collections Statement. An installment Arrangement can be set up depending on what the disposable income is. Or, it could be Non-Collectiable again( CNC). You need to be an EA, or CPA to do this. If the appropriate collection letters were not sent out, (CP503, CP 504 and LT11 - Final Notice) you can file a CDP (Collection Due Process) request, form 12153. However, the main reason taxpayers do not receive IRS letter is that they have moved and have failed to file form 8822, change of address. If all else fails, the last resort is the Taxpayer Advocate Service, but when you call them you must tell them that the matter is URGENT and they will respond in 48 hours, otherwise it will be several weeks.