How To Avoid IRS Notices And Penalties
Posted: Aug 05, 2022
When you owe back taxes, the stress is constant. Wondering when the IRS will catch up to you, Fearing financial turmoil, and then the day comes when that IRS "Notice of Intent to Levy" arrives in the mail. Preventing the Notice of Intent to Levy from becoming necessary is the key to financial freedom and peace of mind. There are steps you can take to avoid reaching this stage of IRS Cp22E collection action.
Do Not Ignore the IRS
Before you receive an IRS Notice of Intent to Levy, you will receive a warning that it is on its way. As soon as the warning arrives, you may begin taking the needed action to stop the IRS from imposing a tax levy on you. The warning will come in the form of a Notice and Demand for Payment. In this notice, the IRS will outline the back taxes owed and the time frame in which you have to pay. The time frame will be short, but there are still options available to prevent the levy from occurring.
The quickest way to stop the Notice of Intent to Levy is to pay your back tax debt in full immediately. In any case, this is not a viable solution for most taxpayers. However, ignoring the IRS will result in increased penalties, fines, and interest. As soon as you receive a demand for payment, it is crucial to consult with a tax attorney to begin communications with the IRS on your behalf.
A skilled tax professional can delay the levy process while negotiating the best settlement of your tax liability. It is important to have a tax expert on your side that is knowledgeable of the various payment plans and tax relief allowances offered by the IRS.
Payment Plans & How They Can Work for You
Often, the IRS is open to agreeing to a payment plan. They would prefer to collect back taxes from taxpayers who enter into an IRS installment agreement rather than pursue more costly methods such as bank levies, wage garnishments and property liens.
The benefits of having a tax professional on your side are:
Protection from being intimidated into accepting an installment agreement you cannot afford.Verification of the accuracy of the back tax amount being demanded.Assurance all tax relief benefits have been applied to your case.Your tax attorney will help you determine how much you are capable of paying and for which programs you may qualify; this may take some time. At first, the IRS may push for the full amount of back taxes owed. If they do agree to a plan, it may be more than you can afford.Nonetheless, a tax expert will be able to speak with the IRS on your behalf, working with them to prevent the IRS Notice of Intent to Levy from being sent out. The tax professional you hire will be privy to your financial information and will know how much you can actually afford to pay. They know what the IRS needs to hear and can negotiate a fair and affordable payment plan for you.
Receiving the CP22E notice can be quite unnerving and it might scare you; that is perfectly normal.