10 Things to Know About the IRS Collection Process
1. Your tax liability is an IRS priority. Your case is likely assigned to either the IRS Service Center or a local IRS Collection office near your residence or place of business.
2. The IRS may take enforced collection, such as issuing a levy or seizing your assets, to resolve your liability. Timely communication with the IRS is critical in preventing such actions from occurring.
3. A “Notice of Federal Tax Lien” may be filed in your name, or your business’s name, attaching to any and all assets you currently own or acquire after the lien has been filed. The IRS uses the tax lien as a means of protecting the government’s interest.
4. If you disagree with your tax liability or certain IRS case action, you have a right to dispute it by asking to speak with a manager or exercising your various appeal rights.
5. You can appeal most IRS collection actions both before and after the action takes place.
6. One of your most important rights as a taxpayer is your right to have a tax professional represent you in front of the IRS. A qualified tax professional, such as an IRS-licensed Enrolled Agent, will guide you through the collection process while simultaneously advocating on your behalf and protecting your interests. At all levels of the IRS, you have a right to representation while addressing your tax matters.
7. Individual taxpayers must be in filing compliance for the IRS to consider collection alternatives, such as an offer-in-compromise.
8. Business taxpayers must be in compliance with filing and federal tax deposits for the IRS to consider collection alternatives, such as an installment agreement.
9. Depending on the matters involved, your collection case may remain open anywhere from a couple of months to several years.
10. Your collection case may be placed in “uncollectible” status if the IRS determines you don’t have the ability to pay the tax at this time. Penalties and interest continue to accrue while in uncollectible status.
Tip: How the IRS Taxpayer Advocate Service (TAS) Can Help You
To learn more about the IRS Collection process, or for immediate assistance with your tax matter, contact us today.
Consultations with our former IRS Personnel and CPAs are always FREE and CONFIDENTIAL.
More Tax Tips