The prevention of levy and seizure action by the IRS to secure unpaid taxes is vital to taxpayer’s who have IRS tax liability. Having your bank account or wages levied or property such as real property, vehicles or investment accounts seized, can have extreme effects on a taxpayer’s ability to meet their household and/or business financial obligations. Understanding the IRS collection process and how to properly navigate it to your advantage in resolving your tax matters is essential to the prevention of IRS levies and seizures.
One of the key ways to ensure the prevention of IRS levy and seizure action is to understand the litany of notices the IRS sends taxpayers prior to the initiation of the collection process. Each of the notices sent to a taxpayer before the collection process has begun will contain language suggesting that the taxpayer must pay the debt in full by a certain date or the IRS will issue levies or take seizure action. This, however, is not the case and understanding the impact of each notice can buy you considerable time in establishing your case to properly address the tax liability.
No matter how much time you can buy through putting the IRS through their burden of issuing out all of the required collections notices, requesting appropriate collections holds to prepare unfiled returns, prepare financial statements or appeal the assessments, at some point, in order to avoid levies or seizures, a resolution of the debt will have to be established.
The IRS offers a vast range of different resolution options to address delinquent debts. There are a number of different installment agreement options. These options vary in terms of both the length of time to repay the debt as well as the total amount of the debt that will ultimately be repaid through the installment agreement. The IRS also offers a hardship program called Currently Not Collectible Status to taxpayers who are not able to pay anything towards the debt because of their lack of income or the level of their reasonable living expenses. One of the most popular and certainly the most comprehensive resolution option the IRS offers is the Offer In Compromise, which allows taxpayers to make an offer based on their income, expenses, and assets to pay an amount in satisfaction of the debt, allowing them to write off the remainder of the debt.
Understanding the mechanics of the collections process, particularly the notice status of a tax account, will allow you to maximize the amount of time you can keep your tax account safe from levies or seizures and be able to address any contingencies to qualify for a particular resolution option and develop the documentation necessary for submission. If you have begun receiving notices from the IRS threatening levy or seizure action please contact a tax practitioner so that you can ensure that your income and assets are secure from these actions. The tax attorneys at J David Tax Law are experienced at handling asset seizures and levies issued by the IRS.
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