Unpaid Taxes: Understand the Collection Process

Having unpaid taxes can be one of the most traumatic experiences anyone can face. Individuals with unpaid taxes will begin to receive a series of notices from the IRS, each of which is progressively more threatening. Some taxpayers do not even understand why they owe the unpaid taxes. If action is not taken to resolve the unpaid taxes then a taxpayer can become subject to a litany of IRS collection tools, such as lien filings, bank levies and wage garnishments. Understanding the collections process, the derivative of the debt and how to properly resolve the unpaid taxes will pay dividends in alleviating the traumatic financial and emotional toll the IRS collections process can take on taxpayers.

Many taxpayers do not understand the notices they receive from the IRS, which begin as initial notices of the balance due and demand for payment and become increasingly more threatening with a series of levy notices, culminating in the Final Notice of Intent to Levy. Understanding the timing of these notices and the appropriate action to take in response to them can go a long way in giving a taxpayer the peace of mind necessary to continue with their lives without having to fear that they will wake up to their bank account being levied or their wages garnished.

Additionally, understanding what created the unpaid taxes, whether it was caused by lack of sufficient withholding; lack of proper estimated tax payments; the disallowance of deductions, credits or adjustments to income or the underreporting of income can help taxpayers prevent any additional unpaid taxes from accumulating.

Properly navigating the IRS collections process to prevent the issuance of bank levies and wage garnishments is the most critical aspect of mitigating the traumatic effects unpaid taxes can have on a taxpayer. Identifying and preparing delinquent returns, drafting the required financial statements and determining the proper IRS resolution program to meet the taxpayers long term and short term financial goals all while protecting them from the levy and garnishment actions threatened in the notices they are receiving is the most comprehensive manner in which to address the effects of unpaid taxes.

If you have begun to receive notices of unpaid taxes please do not delay in contacting a tax practitioner who can advise you of the appropriate response to each notice received, evaluate your tax account to identify the derivative of the debt and implement a strategy to prevent future debt, determine the proper course of action to resolve the unpaid taxes and effectuate that strategy through the submission of the necessary forms and documents to the IRS all while protecting you from collections actions such as liens, levies and garnishments.

The tax attorneys at J David Tax Law are experienced at helping you handle such complex legal tax matters and working with the IRS to resolve your unpaid taxes.

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