What Are the Worst Things the IRS Can Do to You?
The IRS wields considerable power. This can make the agency frightening to deal with, particularly when tax discrepancies arise.
In reality, while the agency’s abilities are vast, potential consequences vary dramatically based on the situation at hand. Below, we’ve outlined a few of the worst-case scenarios you’ll want to avoid at all costs:
Impose a Tax Lien
Liens and levies are often confused. While they’re definitely different, however, both can be devastating. A lien doesn’t necessarily result in confiscated property, but rather, involves a legal claim placed on behalf of the government. Not only could this lead to a levy, but it may also damage your credit, thereby making it far more difficult to score a mortgage or other loan.
The IRS has the power to seize your assets, which can then be used to pay down your tax debt. This could mean that your bank accounts, retirement income, Social Security benefits, or wages from employment are compromised.
Refunds from state taxes are frequently applied to federal liabilities. The IRS has also been known to confiscate property, with the intention of selling it and using the proceeds to satisfy the debt. Cars and real estate are frequent targets.
Send You to Jail
Although unlikely, it is possible for the IRS to use criminal convictions as a means of enforcement. This approach is typically reserved for cases involving tax fraud or evasion. Even then, it’s far more common for the IRS to opt for financial repercussions. If, however, a clear pattern of willful evasion is established, a jail sentence is possible.
If you’re determined to avoid these harsh consequences, it’s imperative that you work with a professional. The team at the Highland Tax Group can provide the protection you need in the midst of an IRS fiasco — or proactive guidance to help you avoid getting in such a mess in the first place. Contact us today to learn more about our services.