Wednesday, June 6, 2018

Are You at Risk of a Tax Levy?


Filing taxes, knowing how much you owe, and then figuring out how to pay it all can be difficult. In fact, many people report being confused during tax season. Unfortunately, though, if you don’t take care of your tax liabilities like you’re supposed to, you could find yourself facing a tax levy.
A tax levy happens when the IRS takes some of your assets, like money in your bank account, or when it chooses to garnish your wages. Fortunately, you’ll be notified before this type of thing happens.  


You’ve Been Warned
As mentioned, the IRS doesn’t just take your money out of the blue. Instead, it will notify you when you owe back taxes. It will also give you deadlines for when the money has to be paid. If you ignore these notices for too long, they won’t just go away.

Instead, it is likely that you will eventually receive a CP77 notice, which will inform you that the IRS plans to levy assets and collect on unpaid taxes. Once you receive this notice, it is imperative that you act fast.

You have several options for what to do when you get this notice. You can attend a hearing if you feel the IRS is not charging you a correct amount. To sign up for the hearing, you simply have to fill out Form 12153 by the required deadline.

You could also request an offer in compromise with the IRS, which would allow you to settle with the IRS and pay an amount less than what you actually owe. Alternatively, you may be able to set up a payment plan with the IRS to pay off the amount you owe in more manageable chunks.

Deciding what the best route is for your situation can be difficult, which is why it is advisable to speak to a tax professional, ideally before things ever get to this point.

No matter what, one thing is for sure- if you ignore the levy notice, the levy will happen.

The Importance of Professional Assistance
As mentioned, it is very important that you seek professional financial advice if you are facing a levy, having trouble paying your taxes, or have other concerns about getting “squared up” with the IRS.
Tax law is confusing, so don’t try to go it alone if you’re not familiar with how everything works.

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