When a taxpayer has a tax debt, the IRS will take certain measures if the taxpayer does not make arrangements to satisfy their debt. Some tax problems can be handled easily with a simple phone call to the IRS, but once a tax debt reaches a certain amount, taxpayers often have difficulty paying and the IRS can become very aggressive.
In order to recover the debt, the IRS may use enforced collection actions against a taxpayer, which can be devastating to a taxpayer’s finances. These collection measures include:
- IRS Tax Liens: The IRS will place a claim against a taxpayer’s property or person as collateral for a tax debt.
- IRS Bank Levies: The IRS will seize funds from a taxpayer’s bank account(s) or accounts receivable for an IRS tax debt.
- IRS Wage Garnishments: The IRS will seize a portion of a taxpayer’s wages, paycheck, or salary to satisfy a tax debt.
These collection actions may have significant adverse affects to a taxpayer’s finances and credit, making it difficult to borrow money through loans from the bank or other private lenders, buy or sell a home, or even rent property. The IRS can leave a taxpayer without a sufficient amount of money to live, and even take away their freedom by putting taxpayers in jail.
Other problems that a taxpayer faces when charged with a tax debt include:
- Payroll Tax Issues: The IRS can take serious measures, including collection actions, to recoup a payroll tax debt from business owners, executives, and in some cases employees of a business.
- Penalties & Interest: The IRS will charge penalties and interest on a tax debt until the full tax debt is paid.
- Unfiled Taxes: The IRS will not negotiate an agreement with a taxpayer who is unfiled for any tax years. It is essential that a taxpayer be up-to-date on all filings before entering into any contracts with the IRS.
Tax Defense Network’s team of licensed tax professionals, enrolled agents, and tax professionals are equipped to handle these common tax problems many taxpayers face when they have a tax debt, giving taxpayers the best line of defense against the IRS.