The issue will become worse if you are not proactive about fixing the problem. The IRS will take particular steps to collect the money, along with added penalty and interest charges.
It all starts with an IRS notice to inform a taxpayer about back taxes that is received in the mail. This correspondence has all the necessary details about the taxes owed and the reason why any extra fee was assessed. It also provides you a certain amount of time to have this problem resolved before accruing additional penalties and interest. This is a good moment to get your tax liability taken care of.
If you ignore the received IRS notice, you might receive a telephone call from IRS Collections or a Revenue Officer. A Revenue Officer can additionally visit you in person at your home to discuss your problem and how you plan to repay the owed taxes. During this meeting the Revenue Officer takes a note of the assets you might have. This provides the IRS an estimate of how much equity you have in your property and whether it is worth selling it to have the taxes paid.
The IRS will also file a lien in order to protect its entitlement to collect the amount that you owe if, for example, you make a decision to sell any of your possessions. Prior to the lien being filed, the IRS needs to issue a Notice of Federal Tax Lien - this provides you a chance to appeal it. However, unless there is a mistake and you do not owe the taxes that the IRS claims you do, filing an appeal in response to this notice will not stop a lien from being filed. It may just slow down the process.
A collection technique the IRS will use is a levy. According to the IRS, a levy is a "legal seizure of your property to satisfy your tax debt". There are many different kinds of levies. A bank levy is a process when a taxpayer's bank receives a Levy Notice from the IRS detailing a demand to send all monies available on your accounts to the Internal Revenue Service.
Fortunately, it's not quite as simple as that. You will receive advance warning of a levy and thirty days to appeal it or resolve your back taxes situation before the levy is issued. This will take the form of an IRS Final Notice of Intent to Levy. It’s generally a sensible idea to appeal this right away. The IRS will then assign an Appeals Officer that will review your case, giving you the opportunity to negotiate a repayment option.
Of course, a bank levy isn't the only type of levy that the IRS has in its collection. One more technique available to the IRS is to issue enforced collection through a Wage Garnishment, where they'll send a letter to your employer, demanding a part of your income to be sent to the IRS. Other methods include a levy on Social Security, a levy on your Accounts Receivable if you have a business, and so on. You should do all you can to solve your tax liability and avoid anything like this occurring, as these are very hard to get removed.
It is generally a lot easier to avoid IRS enforced collection than to undo its harmful effect on your assets. If you are unsure where to start, contact a tax debt expert to talk about your alternatives. Many companies provide free consultation, which also helps you to choose which tax professional to hire if you think you should have someone to represent you in this matter.
It all starts with an IRS notice to inform a taxpayer about back taxes that is received in the mail. This correspondence has all the necessary details about the taxes owed and the reason why any extra fee was assessed. It also provides you a certain amount of time to have this problem resolved before accruing additional penalties and interest. This is a good moment to get your tax liability taken care of.
If you ignore the received IRS notice, you might receive a telephone call from IRS Collections or a Revenue Officer. A Revenue Officer can additionally visit you in person at your home to discuss your problem and how you plan to repay the owed taxes. During this meeting the Revenue Officer takes a note of the assets you might have. This provides the IRS an estimate of how much equity you have in your property and whether it is worth selling it to have the taxes paid.
The IRS will also file a lien in order to protect its entitlement to collect the amount that you owe if, for example, you make a decision to sell any of your possessions. Prior to the lien being filed, the IRS needs to issue a Notice of Federal Tax Lien - this provides you a chance to appeal it. However, unless there is a mistake and you do not owe the taxes that the IRS claims you do, filing an appeal in response to this notice will not stop a lien from being filed. It may just slow down the process.
A collection technique the IRS will use is a levy. According to the IRS, a levy is a "legal seizure of your property to satisfy your tax debt". There are many different kinds of levies. A bank levy is a process when a taxpayer's bank receives a Levy Notice from the IRS detailing a demand to send all monies available on your accounts to the Internal Revenue Service.
Fortunately, it's not quite as simple as that. You will receive advance warning of a levy and thirty days to appeal it or resolve your back taxes situation before the levy is issued. This will take the form of an IRS Final Notice of Intent to Levy. It’s generally a sensible idea to appeal this right away. The IRS will then assign an Appeals Officer that will review your case, giving you the opportunity to negotiate a repayment option.
Of course, a bank levy isn't the only type of levy that the IRS has in its collection. One more technique available to the IRS is to issue enforced collection through a Wage Garnishment, where they'll send a letter to your employer, demanding a part of your income to be sent to the IRS. Other methods include a levy on Social Security, a levy on your Accounts Receivable if you have a business, and so on. You should do all you can to solve your tax liability and avoid anything like this occurring, as these are very hard to get removed.
It is generally a lot easier to avoid IRS enforced collection than to undo its harmful effect on your assets. If you are unsure where to start, contact a tax debt expert to talk about your alternatives. Many companies provide free consultation, which also helps you to choose which tax professional to hire if you think you should have someone to represent you in this matter.
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