What will the IRS do if you don't do something about the tax liability you owe them? The IRS will assess you with interest and penalty charges and take particular steps to collect the outstanding taxes.
The earliest warning, that you must to resolve your owed taxes, is a correspondence that includes information on the balance due, together with any penalty fees and interest, that you'll get from the IRS. At this point you have a brief amount of time, as defined in the letter, to resolve the tax situation before you may be assessed with extra penalties and interest.
Don't disregard the received IRS notice unless you want the problem to escalate. In some situations, for their next action, the IRS may phone you, or you may get a visit at your office or home, by an IRS Revenue Officer. If you do not give them with a decent proposal for sorting out your tax liability, they will start assessing your equity to determine if it can be sold to resolve the tax liability.
The next warning you may receive is an IRS Notice of Federal Tax Lien; this shows that the IRS intends to take steps to protect its right to collect the taxes that you owe, if, for example, you try to sell any of your property. You can appeal the lien, but it's unlikely to do more than postpone the unavoidable, unless there's truly an error and you don't owe what the IRS claims.
A collection technique the IRS can use is a levy. According to the IRS, a levy is a "legal seizure of your property to satisfy your tax debt". There are a variety of types of levy. A bank levy is a process where the taxpayer's bank gets a Levy Notice from the IRS with a demand to send all money available on your accounts to the Internal Revenue Service.
In order to issue a levy, the IRS needs to inform you by sending a Final Notice of Intent to Levy to your mailing address. This notice gives you thirty days to file an appeal, or have your issue resolved by covering the entire tax debt and fees, or working out a repayment option with the IRS. It’s not a bad idea to appeal a Final Notice of Intent to Levy as soon as you receive it. In this case the IRS will assign an Appeals Officer to look at your case, which might be your chance to discuss your payment options.
Of course, a bank levy is not the only form of levy that the IRS can issue. One more method accessible to them is to issue enforced collection through a Wage Garnishment, where they'll send a letter to your employer, demanding a percentage of your earnings to be sent to the IRS. Other possibilities include a levy on Social Security, a levy on your Accounts Receivable if you have a business, and so on. You ought to do everything you can to solve your back taxes and avoid anything like this happening, as these are very tricky to get removed.
In fact, it's virtually always easier to prevent enforced collection than to have it removed once it is in place. Consequently, particularly if you're at the early phases of the collection process, now is a good time to take control, before things worsen. Tax experts are on hand to offer tax debt help, and it is always a good plan to phone a specialist. In many cases, like when trying to negotiate an offer in compromise, you will only have one attempt, so you don't want to make any errors.
The earliest warning, that you must to resolve your owed taxes, is a correspondence that includes information on the balance due, together with any penalty fees and interest, that you'll get from the IRS. At this point you have a brief amount of time, as defined in the letter, to resolve the tax situation before you may be assessed with extra penalties and interest.
Don't disregard the received IRS notice unless you want the problem to escalate. In some situations, for their next action, the IRS may phone you, or you may get a visit at your office or home, by an IRS Revenue Officer. If you do not give them with a decent proposal for sorting out your tax liability, they will start assessing your equity to determine if it can be sold to resolve the tax liability.
The next warning you may receive is an IRS Notice of Federal Tax Lien; this shows that the IRS intends to take steps to protect its right to collect the taxes that you owe, if, for example, you try to sell any of your property. You can appeal the lien, but it's unlikely to do more than postpone the unavoidable, unless there's truly an error and you don't owe what the IRS claims.
A collection technique the IRS can use is a levy. According to the IRS, a levy is a "legal seizure of your property to satisfy your tax debt". There are a variety of types of levy. A bank levy is a process where the taxpayer's bank gets a Levy Notice from the IRS with a demand to send all money available on your accounts to the Internal Revenue Service.
In order to issue a levy, the IRS needs to inform you by sending a Final Notice of Intent to Levy to your mailing address. This notice gives you thirty days to file an appeal, or have your issue resolved by covering the entire tax debt and fees, or working out a repayment option with the IRS. It’s not a bad idea to appeal a Final Notice of Intent to Levy as soon as you receive it. In this case the IRS will assign an Appeals Officer to look at your case, which might be your chance to discuss your payment options.
Of course, a bank levy is not the only form of levy that the IRS can issue. One more method accessible to them is to issue enforced collection through a Wage Garnishment, where they'll send a letter to your employer, demanding a percentage of your earnings to be sent to the IRS. Other possibilities include a levy on Social Security, a levy on your Accounts Receivable if you have a business, and so on. You ought to do everything you can to solve your back taxes and avoid anything like this happening, as these are very tricky to get removed.
In fact, it's virtually always easier to prevent enforced collection than to have it removed once it is in place. Consequently, particularly if you're at the early phases of the collection process, now is a good time to take control, before things worsen. Tax experts are on hand to offer tax debt help, and it is always a good plan to phone a specialist. In many cases, like when trying to negotiate an offer in compromise, you will only have one attempt, so you don't want to make any errors.
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