BACK TAX DEBTS

A lot of people don’t realize how easy it is to end up owing the IRS...and it can add up quite fast. It’s one of the most stressful things that can happen to someone.

What can happen if I owe debts?

The IRS has a lot of tools at its disposal to collect back taxes, even by the means of enforcement. The IRS is required to mail out notices to you before they have the ability to collect back taxes by the means of enforcement --so be sure to keep your mailing address up to date with them.

Once the notices have been issued and if nothing had been addressed, the IRS can collect taxes by the means of enforcement, such as some of the following:

  • Bank account levies: taking funds out of your bank account.

  • Wage Garnishment: garnishing your paycheck to collect back taxes.

  • Filing Tax Liens: The IRS can file tax liens with your local county to secure their interest in any assets you may have. It puts the IRS in a higher position than other creditors. Liens are public record which can make it difficult to buy/sell assets. Some IRS resolution programs come with the condition of lien filings as a standard procedure.

The IRS can also notify the State Department to suspend your passport if your taxes are classified as ‘seriously delinquent.’ It’s not uncommon for an IRS Federal Agent (Revenue Officer) to be assigned to your account to try to collect the back taxes owed.

Steps To Take To Fix:

#1: Increase Withholdings/Deposits

  • Increasing withholdings and making Estimated Tax Deposits (for income not subject to tax withholdings, such as self-employment income) helps ensure that you won’t owe on future tax returns. This is a requirement for maintaining a resolution. We can walk you through the steps you need to take to get ‘current’ with your current taxes.

#2: File Any Past Due Returns

  • Generally, the most recent 6 years of individual tax returns will need to be filed to be considered ‘tax compliant’ with the IRS.

    Don’t have access to your income info?

  • We can help get what the IRS has on file for you, or you can now more easily request it yourself from the IRS.

BACK TAX DEBTS

If you can't pay back your tax debts, there are resolution programs that the IRS can consider.

#3: Determine Available Resolution Options

  • It’s important to get into a formal resolution program with the IRS so that they don’t try to collect taxes by means of enforcement. If you can’t afford to pay your back tax debts all at once, the IRS allows for a Payment Plan (known as an Installment Agreement). Depending on your situation, some Installment Agreements can be formalized without the IRS needing to review your income/assets and financials, and may allow you to avoid lien filings.

    Can’t Afford the IRS Payment Plan?

  • We can help you explore resolution options that are based on YOUR financial ability.