What do you do after you receive your first collection notice from the IRS?
Sit down, take a deep breath and call a tax professional. My practice handles collections cases all the time and I can help you.
It helps to know how the IRS Collection Process works. Here’s a brief overview:
- Once a tax return is filed and processed by the IRS, the tax is assessed
- Then a collection letter is sent asking for payment
- If payment is not received right away a “silent lien” is issued and the collection letters become more aggressive
- If you owe more than $10,000 and still haven’t paid, the IRS will file a “Notice of Federal Tax Lien” which destroys your credit rating
- If you continue to ignore them, then they begin “levying” your assets. A levy is an actual “taking”, like cleaning out your bank account or having your employer garnish your wages
How do you make this nightmare go away?
In three words; compliance, communication and resolution.
Compliance means getting current on filing your tax returns.
Communication means reaching out to the IRS to let them know you want to clean this up. As an Enrolled Agent (EA) I am admitted to practice before the IRS on behalf of clients on all tax matters.
Resolution means getting on a workable installment payment plan to pay off your balance due.
Michael O’Leary, EA
By The Book Taxes
1 Morgan Avenue
Norwalk, CT 06851