The IRS has reinstated it's Automated Collection Notice program. These are the letters mailed to taxpayers with unpaid tax liabilities. There are a series of tax collection notices that must be mailed to taxpayers by law before the IRS can begin their enforcement procedures.
Anyone receiving IRS notices asserting an unpaid tax liability should read them carefully and pay attention to deadlines and taxpayer rights described in the letter. Failing to respond to notices by indicated deadlines can lead to the loss of taxpayer legal rights. This in turn can take the form of a loss of rights to an appeals hearing, the right to judicial review in court and ultimately owing more taxes than one actually owes.
Once the series of tax collection notices are complete, the IRS can take enforcement action in the form of tax levies on income (wages, contractor income, social security income, etc.) and assets (bank accounts, retirement accounts, pensions, investment accounts, real estate, vehicles, collectibles, etc.). In addition, the IRS can file a Notice of Federal Tax Lien (NFTL). This is typically with the county recorder, county clerk or Secretary of State and informs the public about the IRS tax liability. Tax collection cases can also lead to IRS criminal investigations.
Earlier responses to IRS notices will give taxpayers greater odds of a favorable outcome. There will be a lower likelihood of the situation escalating and more serious IRS personnel being assigned to the case.
Feel free to contact me with any questions.