There are many people with federal tax debts here in the United States. According to the Internal Revenue Service, overall, there is currently around $458 billion in back taxes owed to the federal government.
The IRS can be very aggressive in its efforts to collect such money. Tax law gives the agency access to many tools related to tax collection. Facing these collection mechanisms can have many significant impacts on a taxpayer’s life. Examples of some of these powerful collection tools include:
- Wage garnishment
- Liens
- Asset seizures
- Legal action
- Tax penalties
In some cases, a tax debt could even end up having impacts on a person’s ability to travel. In certain cases involving high amounts of federal tax debt, the IRS may ask the State Department to take actions to take away a passport or keep a person from getting this important travel document.
Given these things, it is understandable that a person could feel like the deck is stacked against them when dealing with IRS collections efforts. However, it is important to know that taxpayers are not without tools they can turn to in order to try to resolve a federal tax debt and address IRS collection actions in a way consistent with their overall interests. Options that could be available include:
- Contesting a debt
- Payment plans
- A negotiated settlement, such as an offer in compromise
- Tax penalty relief
- Lien releases/withdrawals
What particular options a person could pursue and which would be most in line with their goals is very circumstance dependent. So, when trying to decide how best to respond to aggressive IRS tax collection efforts, the guidance of a skilled tax lawyer can be a critical thing have. Such lawyers can help individuals accused of owing back taxes with developing a well-tailored strategy for responding to their situation.