The IRS can levy accounts, garnish wages, and seize other assets if you have IRS debt, and it has followed some required steps.
The IRS will tell the U.S. state department about your debt. The state department can choose to deny or not renew a passport.
If you owe the IRS or will owe the IRS, there are some specific steps you need to take to ensure no enforced collection takes place.
If the IRS is currently levying your assets or garnishing your wages, there are specific steps that can be taken to stop it.
In 2011 and 2012, the IRS made several changes related to collection, lien, and other issues, that made it easier for taxpayers with IRS debt.
The law places a deadline to collect on the IRS. the deadline is typically called the “IRS collection statute expiration date”. It can be more complex than it sounds.
IRS debt can be paid in full, settled, challenged, or discharged in bankruptcy. The way you deal with it will depend on your financial situation, IRS history, and personal goals.
The IRS keeps a history of each tax year. These histories contain a lot of information that can be very helpful in determining how to deal with the debt.
In most IRS debt situations, the best path to take isn't obvious. A detailed review of your financials, IRS history, and debt amounts, are usually required to make the determination.
Like most things in life, there are pros and there are cons. When dealing with the IRS, the pros and cons need to be understood before moving forward.
As a short-term solution, or if your debt is close to its collection statute expiration date, IRS non-collectible status can be very useful.
A partial pay payment plan based on the ability to pay successfully set up with the IRS means that the IRS agrees that you can't afford to pay the debt in full over time.
An IRS partial pay payment plan based on ability to pay, is a common way to deal with IRS debt. Some “analysis” is necessary, and then some specific steps.
Anyone can follow the steps necessary to set up a “streamlined” installment agreement with the IRS. but…should you?
Paying the IRS debt in full over time doesn't sound like a great plan. Sometimes, it's the only option, and it does have its “pros” as well as cons.
There are several ways to pay IRS debt in full. The first step in setting up one of them is determining whether you should. The remaining steps are straightforward.
Certain tax debt amounts result in IRS lien notice recordings. There are rules that can be followed to prevent it and rules that can be followed to undo it.
Probably. sometimes there are ways to reduce IRS debt, and/or pay less per month. Until you've had your financial situation reviewed and IRS history analyzed, you may not know what those options are.
The IRS' “ability top pay” installment agreement is sometimes called a “poor man's offer in compromise”.
Most arrangements made with the IRS have the side-benefit of stopping IRS collection activity. But…it's better to plan ahead and avoid it altogether.
When the IRS is positioned to levy, garnish, seize etc. a request for time to pay in full can be used to stop it from happening. There are some caveats, however.
The IRS does settle debts, but it doesn't settle them informally. It's required to apply a set of rules that determine your ability to pay the debt in full….Or not. it's important to understand this, and what those rules are before giving it a go.
The IRS offer in comproimise amount is based on a formula. The process isn't “informal”. the formula is used to determine how much you can afford to pay on the debt.
The IRS collection statute expiration date is relevant to every IRS debt collection alternative. Understanding how it effects each one is important before setting off.
Yes, the IRS collection statute expiration date can change and usually not to your benefit.
Removing IRS penalties only makes sense in a few specific instances. This may be contrary to popular thought, but for many with IRS debt, it's a waste of time.
Yes. Sometimes it makes sense to use bankruptcy to deal with tax debt. There are a few scenarios that make bankruptcy worth considering.
IRS debt other spouse's fault? It may be possible to convince the IRS to treat you as “innocent” and remove you from liability status.
Innocent spouse relief isn't easy to obtain. The first hurdle is understanding the requirements. The second is understanding the steps necessary to make it happen.
The IRS substitute return may not be correctly done. Your return, if it's accepted, will reduce your tax debt. But…will it make sense to try and replace their return with your return?
If a tax return is missing from your history, and you are trying to resolve tax debt with the IRS, the missing return will prevent the resolution.
If you've already reached an agreement with the IRS, new IRS debt can ruin it. care must be taken to ensure enough is being withheld to avoid new debt.
There are a number of different ways to “resolve” a tax debt with the IRS. each one has its own unique process and timeframe.
You reached an agreement with the IRS, but you hit a short “bad patch” and missed a few payments. What now?
It may be important to understand the differences between working with IRS automated collections and an IRS revenue officer…
The IRS uses private collection to try and follow up on certain tax debt. This may play to your benefit.
Your budget isn't really your budget for purposes of finalizing an agreement with the IRS. if you don't understand this, you won't understand your agreement.
The primary document used by IRS collections to obtain information is IRS form 433. There are important things you need to know about this form before submitting it to the IRS.
The IRS is required to consider your appeal in certain circumstances. You are required to appeal at the right time and in the right way…
If you've arranged an installment agreement with the IRS, or even reached a settlement agreement…the IRS is still going to take your refund...for a while.
The IRS' timeframe to collect the debt will run out at some point. Believe it or not, it often does before the debt is paid.
The IRS lien notice is recorded at the county recorder's office. It isn't sent directly to credit reporting agencies.
In certain circumstances it will do both. In certain circumstances it won't make sense to try.