If you have tax debt with the IRS, you are most likely bracing yourself for what is coming next – IRS Collection. The IRS collection process can be confusing and downright scary for someone who has never gone through it before. Although every case is unique, the IRS has developed a general framework that it regularly follows. If you have tax debt and are unsure how to handle it, the professionals at Highland Tax Group can provide you with the guidance that you need.
The IRS Collection Process
The IRS collection process begins after a tax is assessed and the balance is not paid in full. This can result from filing a tax return with a balance due and failing to pay, or from an IRS audit or adjustment.
The IRS will contact you through an escalating series of notices, including:
- A CP 14 Balance Due Notice. This notice is typically your first communication from the IRS, outlining the amount due and demanding payment.
- CP 501 and 503 Notices. These are follow-up notices which demand payment and inform you that penalties and interest are accruing on your tax debt.
- CP 504 Notice. This is the final notice that you will receive from the IRS before they begin the process of filing a tax levy against your property.
If you ignore these notices and fail to pay your tax debt, the IRS will send a letter notifying you that it is beginning the process of filing a tax levy and informing you of your right to request a Collection Due Hearing. You have 30 days to request the hearing.
After this notice process is concluded, the IRS may assign a Revenue Officer. The Revenue Officer is empowered to take action against you to collect the tax debt, including filing a tax lien against your property or bank account, garnishing your wages, or even placing a restriction on your passport.
Contact the Highland Tax Group If You Have Received a Collection Notice From the IRS
Do not ignore the IRS if you have unpaid tax debt. You may be subject to asset seizure and tax liens. The tax professionals at the Highland Tax Group will review your tax situation and work with you to obtain the most favorable outcome. Contact us today.