If you owe back taxes or have failed to file in years past, then at some point the IRS is going to adopt aggressive collection efforts. Unlike other collection agencies, the IRS can implement and enforce levies to your wages or bank accounts without a court order. Therefore, the best way to resolve a levy is by getting out in front of the problem before the IRS ever takes those steps.Keep reading to learn five tell-tale signs that you are about to receive a levy from the IRS. If you experience any of the following, you should contact S.H. Block Tax Services immediately to avoid lost wages, diminished bank account balances, and lengthy legal proceedings.
#1: Missed Deadlines
If the IRS has given you an explicit deadline and that deadline has since passed, they are likely to pursue more aggressive collection efforts, such as a lien or levy. Many times, people fail to meet deadlines simply because they aren’t sure of where to find the information or documentation the IRS is seeking or how to get this information processed properly.
If you have received correspondence from the IRS that is difficult to understand or interpret, please contact us today so that we can ensure that all deadlines are met and that the IRS has all the legally required documentation they need to review your case.
#2: Failure to Respond to an IRS Revenue Officer
Choosing not to respond to an IRS revenue officer is a surefire way to draw their ire and ensure that they proceed to levy your wages and bank accounts. These employees are local and have already been given your case because you are on the IRS’ radar, and their proximity to you allows them to investigate more carefully.
If an IRS revenue officer has been in contact over the phone, or in person at your home or place of business, you need to respond to them and provide them with any legally required documentation they have requested. These employees have busy schedules, and choosing not to respond could irritate them and draw further unwanted attention to your case.
However, if you hire an experienced tax representative like S.H. Block Tax Services, they will likely be able to keep these revenue officers away from your home or business. In extreme cases, they might even be able to successfully file for a restraining order.
Pyramiding is an industry term used to describe taxpayers who continue to owe year after year. Gradually, the amount owed keeps growing (or “pyramiding”) until the liability becomes too much for the individual to pay in full.
Self-employed people in particular often struggle with pyramiding. If you are self-employed, you should set up an estimated tax account, which allows you to set money aside with each payment you receive. That way, you can avoid the trap of falling further behind on your taxes every year.
#4: Unfiled Tax Returns
There is no way around the problem of unfiled tax returns (or unfiled Form 940s and Form 941s). The IRS is aware that you failed to file, and unfortunately, there are no free passes — the IRS will not stop until you bring your taxes up to date, and they will ensure that you do so by placing a levy on your wages and bank accounts.
Not only that, but the IRS and the state of Maryland have the ability to investigate further into the matter and even prepare your tax returns on your behalf. Known as a Substitute for Return (SFR), this a process in which the IRS estimates your tax liability, and you usually wind up owing far more than you would have had you filed on your own.
#5: Final Notice of Intent to Levy
Last but certainly not least, if you have received a Final Notice of Intent to Levy, it doesn’t take much tax experience to realize that the IRS means business. The IRS is legally required to send a Final Notice before they can issue a levy, and they must wait at least 30 days before they can implement the levy.
During this 30-day window, you have the right to request a Collection Due Process Appeal (CDP), which could lead to the levy action being halted or eliminated entirely. If you choose not to appeal, the levy will continue as scheduled, and the IRS could assess your tax liability and begin garnishing your wages and account balances in just 30 days.
If you feel that a Final Notice of Intent to Levy was sent but that you failed to receive it, please contact our offices today so that we can accurately evaluate the possibility of the IRS instituting a levy of your wages or bank accounts and determine what we need to do to get you back in compliance.
Contact S.H. Block Tax Services Today to Reduce or Eliminate IRS Levies
The most important thing to remember when dealing with unresolved tax liabilities is that you need to respond to the IRS’ attempts at communication. If you know that you can’t meet a deadline, contact your revenue officer as soon as possible. In most cases, these individuals are willing to work with you, but if you ignore them, they will institute aggressive collection efforts.
If you owe back taxes or have failed to file in years past, please contact S.H. Block to avoid further financial and legal issues with the IRS. We have significant experience dealing directly with the IRS and their revenue officers, and we’re willing and eager to work with them on your behalf.
Complete the form on this page or call us today at (410) 793-1231 to receive a free consultation and learn how we can help. But remember, you only have 30 days from the date of your Final Notice of Intent to Levy to appeal, so be sure to contact us as soon as possible to resolve your tax issues.