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Back Taxes Help

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When Will IRS Collection Actions Be Taken Against You?

Back taxes are serious business. If you’re in debt to the IRS, you can be absolutely sure that one day or the other, they’re going to come after you to recover everything you owe them. You might be able to go a few months or years without action from them, but rest assured, you won’t be let go scot free. So are you wondering when the IRS will come after you? Or are you concerned about your tax problems and wondering if the IRS is going to come down on you hard? Here’s how and when the IRS will initiate collection tactics against you.

IRS Collection Tactics Be Taken Against Me

Failure to comply with the IRS rules and regulations, ignoring paying your tax debts or committing tax fraud are sure shot ways to get in the bad books of the IRS. A lot of the collection methods used by the IRS can be very damaging to your financial stability, and they get progressively worse depending on the severity of your infraction. Their collection methods include:

• Wage garnishments

• Levies

• Liens

• Property seizure

• Cancellation of business license

• Closure of business

But if you’re worried about harsh collection tactics being used against you for a minor tax offence, you can rest easy. The IRS won’t just start off with these methods without any prior intimation. It will send you a couple of notices that get sterner as time passes, so if you’ve received any of these notices, it’s time for urgent action. The notices are in the following order:

• CP-14: The first notice, which begins the IRS collection process, and is a bill of unpaid taxes.

• CP-501: The second notice that usually arrives after 5 weeks of inaction on your part.

• CP-503: The third notice that arrives in another 5 weeks to remind you about your tax debts.

• CP-504: The fourth notice that says ‘Intent to Levy’, which threatens to seize your state income tax refunds.

• Letter 1058: Finally, there comes the ‘Notice of Intent to Levy and Notice of Your Right to a Hearing’, 30 days after which the IRS is at liberty to take serious action like bank levies.

Even if collection tactics have been initiated against you, it’s not endgame. You can still appeal against the IRS if you feel that you have been unfairly targeted. Although rare, it is possible that you have been targeted because of misinformation, so if you notice something off about your supposed offences, there’s always the Freedom of Information Request and appeals at your disposal.

Furthermore, it is also possible that you haven’t paid off your taxes because of genuine financial hardship, in which case it’s perfectly fine to appeal to the IRS as well. Contrary to popular belief, the IRS is not the evil organization they think it is, and exceptions are definitely made for genuine cases. You can apply for the ‘Currently Not Collectible’ status during hard times, but make sure you really can’t pay taxes before you do so. The IRS will check the following information before considering your request:

  • Your gross monthly income
  • Your allowable monthly expenses
  • Your liquefiable assets
  • Your total IRS backtax liability

The bottom line is, if you skip paying taxes or anything of that sort that goes against the IRS, they will come after you, after letting you know that they are going to. Avoiding these collection tactics is simple and can be summed up in a phrase – pay your taxes on time. If you’re not able to do so, at least let the IRS know by asking for exemptions or identify as ‘currently not collectible’. Not providing the right information or not providing any information at all can be just as dangerous. And finally, if you’re under the IRS radar and receiving notices, do something about it as soon as possible. The best way is to hire a certified tax professional who really knows how to deal with the IRS, because it’s folly to take on a giant alone!

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IRS Bankruptcy Filing – Discharge IRS Debts and Back Taxes

Tax debts may be eligible for discharge if you’ve been the victim of unfortunate circumstances and have extensive tax debts. Whether it’s a full discharge or agreeing to a repayment plan for settling your debts partially, there are options available.

Filing for bankruptcy is one way to get tax relief, but it should be considered as a last resort. According to many tax professionals, filing for bankruptcy for tax relief is frowned upon. However, contrary to popular belief, filing for bankruptcy can completely stop IRS collection tactics, but there is a catch.

IRS Bankruptcy Filing

Tax code is quite complicated. There are certain provisions for situations where tax debts are dischargeable, so a certified tax professional is the best person to tackle this process. In simple terms, older taxes are easier to discharge, while newer taxes aren’t.

Discharging a tax during bankruptcy relief depends mainly on a couple of dates. There are time requirements related to the taxes owed, such as:

  • The last date on which the return was due for the year of the delinquent tax
  • The date the taxpayer filed the applicable return
  • The date the tax return was assessed by the IRS
  • How close the foregoing dates are to the taxpayer filing for bankruptcy

To be eligible for bankruptcy tax relief, your tax debt must meet the following conditions:

  • The tax return due date was at least 3 years ago.
  • The tax return filing date was at least 2 years ago.
  • The tax assessment is at least 240 days old.
  • The tax return was not fraudulent.
  • You are not convicted of tax evasion.

As you can see, filing for bankruptcy is not as easy. There are many conditions, clauses, and terms that everyday taxpayers might not understand. This is why a consultation from a certified tax professional can be beneficial. Do not make the mistake of trying to file for bankruptcy without weighing your options or consulting an expert.

The tax experts at Long Island Tax Resolution Services will help you determine whether filing for bankruptcy is the best solution for your unique situation. Your eligibility for tax relief depends on a variety of factors, and we will analyze your financial situation to determine whether your tax liabilities qualify for tax discharges. Contact us today to learn more.

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Back Taxes Help to Solve IRS Tax Problems

Outstanding taxes are known as back taxes. These unpaid taxes can result from the local, state, or national level. Whether the back taxes are from the previous year or many years prior, they typically include added penalties and interest, both of which become greater the longer the tax debt is outstanding.

back taxes help

Back taxes are the beginning of tax problems. If unpaid taxes keep stacking up, it will reach a point where the IRS takes serious action, and it could become difficult to pay off.

Consequences for not paying taxes on time include the following:

Sometimes it’s not possible to pay taxes on time. Luckily, the IRS has provisions to make it easier for people in this situation to settle tax debts. If you meet the criteria, you might be eligible for one or more of the following IRS back tax relief schemes:

The IRS applies a penalty to back taxes, as well as interest and additional late payment penalties. Sometimes the late payment penalties can be waived if there was a reasonable cause for the delay.

Paying taxes on time is the best way to avoid contact with the IRS, but there is hope if a situation does arise. If you’re being threatened with a bank levy or tax lien on your property, consider hiring a professional tax consultant. Experts understand the nuances involved with the IRS back taxes settlement process, and they will bring security and comfort to an otherwise dismal situation.

Back Tax Relief Services

Hiring a certified tax professional, such as an enrolled agent, CPA, or tax attorney, will ensure your specific case is handled properly. The complicated tax code and small details involved with tax relief strategies are better left in the hands of experienced professionals.

The experts at Long Island Tax Resolution Services will work to settle your IRS back taxes. Leave the complicated documentation and procedures to our team of highly qualified tax professionals who will find the optimal IRS tax resolution plan for your specific situation. From getting your documents in order to negotiating with the IRS on your behalf, Long Island Tax Resolution Services is always by your side. We also offer an Attorney PLUS program to maximize your benefits while minimizing your costs.

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5 Practical Tips to Deal With IRS Back Taxes

Tip #1: Deal With Your IRS Tax Problems Today!

The ostrich approach to dealing with IRS back tax problems simply does not work. If the IRS is calling you or writing you letters, your IRS tax problems will only worsen if you do not deal with them immediately. The IRS designed their collection actions to become increasingly severe over time.  Phone calls and letters eventually lead to wage garnishments, bank levies and tax liens. Even if you cannot pay your tax liability you still need to address it today without delay. Penalties and interest continue to accrue on a daily basis on the tax liability and delaying action only compounds the problem.

Tip #2: File Back Tax Returns Immediately!5 practical tips 1

The IRS will not agree to a settlement until the taxpayer files all unfiled tax returns.  Taxpayers often neglect to file the back tax return because they don’t have the money to pay the back taxes owed.  A taxpayer should always file a tax return even if they cannot pay the tax liability. The penalties for failure to file tax returns are among the highest the IRS imposes: 25% in many cases. Finally, filing your back tax returns can lead to significant savings on your overall tax liability.

Tip #3: Pay Back Taxes First!

The IRS is the most powerful collection agency on earth. The law protects taxpayers to a greater degree from creditors than it does from the IRS.  If the taxpayer is faced with owing several creditors at the same time, they should always choose to pay their IRS tax liability first.  The IRS uses collection tools such as a wage garnishment or a bank levy and others. These actions can be financially crippling.  A good IRS tax consultant has experience in debt management analysis.  Good debt management can lead to significant savings on a the tax liability and on other debt as well

Tip #4: Pay An IRS Tax Liability With A Credit Line!

There are many good reasons for using a credit line to pay back tax debt owed:

  • For example, credit line interest may be lower than IRS interest & penalties.
  • Also, the cash flow from a credit line can fund some kinds of tax debt settlement.
  • Finally, a credit lender is easier to deal with than the IRS.

Essentially the taxpayer is converting a tax liability into personal credit.   An IRS tax consultant, experienced in this type of analysis, can assess the chances of success.

Tip #5: Hire An IRS Tax Consultant!

A taxpayer should not try to handle their own IRS tax problem case.  An experienced IRS tax consultant, like a U.S. Treasury Appointed Enrolled Agent or a Tax Attorney, is the best choice to deal with the complexities surrounding a taxpayer’s IRS tax problems.  They can predetermine a taxpayer’s chances of success in an IRS tax relief program such as Offer in Compromise or penalty or interest abatement.

 

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5 Practical Tips For Dealing With IRS Back Taxes

Tip #1: Deal With Your IRS Tax Problems Today!

The ostrich approach to dealing with IRS back tax problems simply does not work. If the IRS is calling you or writing you letters, your IRS tax problems will only worsen if you do not deal with them immediately. The IRS designed their collection actions to become increasingly severe over time.  Phone calls and letters eventually lead to wage garnishments, bank levies and tax liens. Even if you cannot pay your tax liability you still need to address it today without delay. Penalties and interest continue to accrue on a daily basis on the tax liability and delaying action only compounds the problem.

Tip #2: File Back Tax Returns Immediately!5 practical tips 1

The IRS will not agree to a settlement until the taxpayer files all unfiled tax returns.  Taxpayers often neglect to file the back tax return because they don’t have the money to pay the back taxes owed.  A taxpayer should always file a tax return even if they cannot pay the tax liability. The penalties for failure to file tax returns are among the highest the IRS imposes: 25{bf3da7fb6a4d0e0e3790d09a79b980fc065e33e2f3a2d49280f7e95b82f4982b} in many cases. Finally, filing your back tax returns can lead to significant savings on your overall tax liability.

Tip #3: Pay Back Taxes First!

The IRS is the most powerful collection agency on earth. The law protects taxpayers to a greater degree from creditors than it does from the IRS.  If the taxpayer is faced with owing several creditors at the same time, they should always choose to pay their IRS tax liability first.  The IRS uses collection tools such as a wage garnishment or a bank levy and others. These actions can be financially crippling.  A good IRS tax consultant has experience in debt management analysis.  Good debt management can lead to significant savings on a the tax liability and on other debt as well

Tip #4: Pay An IRS Tax Liability With A Credit Line!

There are many good reasons for using a credit line to pay back tax debt owed:

  • For example, credit line interest may be lower than IRS interest & penalties.
  • Also, the cash flow from a credit line can fund some kinds of tax debt settlement.
  • Finally, a credit lender is easier to deal with than the IRS.

Essentially the taxpayer is converting a tax liability into personal credit.   An IRS tax consultant, experienced in this type of analysis, can assess the chances of success.

Tip #5: Hire An IRS Tax Consultant!

A taxpayer should not try to handle their own IRS tax problem case.  An experienced IRS tax consultant, like a U.S. Treasury Appointed Enrolled Agent or a Tax Attorney, is the best choice to deal with the complexities surrounding a taxpayer’s IRS tax problems.  They can predetermine a taxpayer’s chances of success in an IRS tax relief program such as Offer in Compromise or penalty or interest abatement.