Attorney at Law

5 Tips to Remember When You Owe the IRS

Do you owe money to the IRS? Being in debt to the IRS, although quite common, can be a stressful experience. However, it is crucial to keep in mind that the issue must be faced head-on, and ignoring the problem will just make it worse. Here are a few other tips that you should keep in mind when you owe money to the IRS.

1. Don’t Ignore the Problem

Firstly, as mentioned above, simply neglecting the fact that you owe money to the IRS will not solve the problem. In fact, doing so can make your situation much worse as it may lead to a rise in interest charges, provide further options for penalties, and revocation of your rights to a hearing. As a result, avoiding IRS notifications by refusing to answer the door or steering clear of the post office is not a viable solution. In most cases, the IRS sends certified mail to prevent you from claiming that you were denied the right to a hearing. It is enough to show that the IRS attempted to give you notice of your opportunity for a hearing. In other words, the IRS is not required to prove that you received the notification, which means that declining to receive notices will only be detrimental, as it will deprive you of the chance to challenge your debts.

2. Work With a Tax Lawyer

It is not unusual to feel overwhelmed or unsure about how to manage your debt to the IRS. Handling matters related to the IRS can be challenging and intricate, which is why it is highly advisable to seek the help of an experienced tax attorney. Particularly when dealing with substantial debt to the IRS, such as debts exceeding $10,000, it may be in your best interest to have your attorney negotiate with the IRS on your behalf. Attorneys who specialize in tax matters typically have extensive experience in dealing with government organizations and possess knowledge regarding your rights as a taxpayer that they can share with you. Additionally, a tax attorney may have the capability to stop the assessment of a tax lien against you.

3. Prioritize Your IRS Debt

If you have outstanding debts to multiple entities, you may want to consider prioritizing the payment of your tax debts before anything else. This is due to the fact that the penalties for not paying your taxes can be incredibly severe. The IRS has the authority to take severe actions in the event that you do not satisfy your debt. Defaulting tax payment without proper justification may cause the IRS to levy your bank account, garnish your wages, seize your property and close down your businesses. Furthermore, the interest rates applied by the IRS typically surpass the interest rates charged by credit card companies, insurance companies, and other entities. 

4. Assert Your Due Process Rights

While the IRS does hold the power to take certain measures if you do not pay your debts, it is crucial to keep in mind that you have due process rights as a United States taxpayer. This means that you have the right to a fair hearing before the government can take any action against you regarding your tax debt. The IRS cannot seize your property or take other collection actions without first notifying you and providing you with an opportunity to challenge the debt. At the time of the hearing, you will have the opportunity to make your argument and submit any evidence or documentation that supports your claim. By asserting your due process rights, you can guarantee that the IRS follows correct procedures and treats you equitably during the debt collection procedure, even if you owe them taxes.

5. Keep Organized Records

The employees of the IRS are human and are susceptible to human error. The IRS handles a large number of tax accounts on a daily basis. Therefore, it is reasonable to state that, similar to any other large organization, mistakes can happen from time to time. It is essential to monitor your tax payments and outstanding balance for this very reason. If the IRS notifies you about a debt that you believe to be inaccurate, you can ask for further documentation and refute the claim using your tax records. However, as mentioned in the initial tip, if you suspect an IRS notification to be incorrect, it is imperative not to disregard it. Instead, you should promptly contact your attorney to assist you in addressing the IRS regarding the alleged mistake.

Bottom Line

In conclusion, there is no denying that owing debt to the IRS can be a challenging experience. Nonetheless, keeping these valuable tips in mind can enable you to navigate the process more effortlessly. This includes working with an experienced tax attorney to help you manage your debt and avoid further complications. Reach out to a top-tier tax lawyer today at Attorney At Law.

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