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About IRS Collections
If the IRS thinks you owe them money, they are going to try and collect it from you. For personal taxes, this means they may take your property, your home, the money in any bank account with your name on it (bank levy), and have your employer send them money out of your paycheck (wage garnishment).
If you own a business, the IRS may seize your business property and assets, including your equipment and accounts receivable. When the IRS starts contacting your customers demanding they send money to the IRS rather than you, many customers will stop doing business with you, making accounts receivable collections one of the most damaging attacks by the IRS.
If the IRS is after you or your business, we can help in many ways. The most well known is by filing an Offer in Compromise, which offers to settle your tax debt for less than you owe. However, if you do not qualify for any OIC, we still have many alternatives.
IRS Seizures - Taking your Money or Property
You have 30 days from the date of the Notice Of Levy issued by the Internal Revenue Service to pay in full or to find another solution. Ignoring this notice or doing nothing will only make matters worse. We can analyze your situation to find the best course of action for you and avoid the levy. Once the 30 days has passed, the IRS does not have to give any further notice before seizing your assets, including your checking accounts, savings accounts, and your wages.
By securing a temporary freeze on further collection activity, we have time to review your situation and determine the best course of action. For many taxpayers, this could lead to an Offer in Compromise.
Account Levies
Bank Levies are the IRS's way of getting your immediate attention. What they are saying is we have tried to communicate with you but you have ignored us. Levies are used to seize your checking accounts, savings accounts, autos, stocks, bonds or anything else you own. If you have more in the bank than you owe then they will only take that amount to satisfy your liability leaving the rest for you.
By securing a temporary freeze on further collection activity, we have sufficient time to analyze your situation and determine the best course of action. For many taxpayers, this could lead to an Offer in Compromise.
Wage Garnishments
One way the Internal Revenue Service will seek payment of an outstanding balance is to take a very large share of your wages until your tax liability is paid in full. After the IRS takes their money, there usually is not enough left over to pay the rent, car payment, buy groceries or pay the rest of your bills.
Abatement of Penalties
The Internal Revenue Code authorizes the abatement of penalties imposed by the IRS for failure to file tax returns, for failure to pay tax, and for other penalties, if the failure is due to reasonable cause, and not willful neglect.
Forgiveness of penalties is decided on a case-by-case basis. Generally, if you exercised ordinary business care and prudence and was, nevertheless, unable to file the return on time, the delay is considered due to reasonable cause. Also, a failure to pay may be due to reasonable cause if you exercised ordinary business care and prudence, yet could not pay the tax liability.
If the IRS determines that failure to pay or failure to file was due to reasonable cause and not willful neglect, the penalty will not be assessed. You would still be responsible, however, for the underlying tax owed plus interest due. Let us seek abatement of your penalties due to reasonable cause and get a reduction in the amount you owe.
Installment Agreements
If you cannot pay all that you owe now and you do not qualify for an IRS Offer In Compromise, an installment agreement may be your next best option. Installment agreements allow you to make monthly payments and stop IRS collection actions. The amount of your installment payment will be based on the amount you owe and your ability to pay.
In many cases, our clients never pay their tax bill in full, even though they did not qualify for an Offer in Compromise. The IRS has only 10 years to collect from you and can only take a portion of your income after your reasonable expenses. This means that, in many cases, the 10 year collection statute will expire before the debt is even close to being paid off.
Collection Due Process Appeals
Collection Due Process (CDP) Appeals are available if you receive one of the following notices:
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Notice of Federal Tax Lien Filing and Your Right to a Hearing Under IRC 6320
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Final Notice - Notice Of Intent To Levy And Notice Of Your Right To A Hearing
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Notice Of Jeopardy Levy And Right Of Appeal
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Notice Of Levy On Your State Tax Refund - Notice Of Your Right To A Hearing
Whenever any of these notices are issued, you have up to 30 days to file a request for a CDP Appeal.
At the conclusion of the hearing, the Appeals Officer will issue a written determination letter. If you agree with this determination, both you and the IRS are required to live up to the terms of the determination. If you disagree with the CDP appeals decision, it can be appealed to a court; however, whatever the Court rules will be binding on both you and the IRS. Let us get you through this appeals process and resolve your IRS collection problems.
A CDP hearing is a complex matter and should be handled by a licensed tax attorney.
If the IRS has contacted you about your personal or business taxes, you need a skilled and licensed Tax Attorney in your corner. for a free evaluation of your situation.
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