As the IRS attempts to collect from more taxpayers, the reasons why are pretty clear. The amount of taxpayers owing money has been increasing for many years.
In 2005, there were 6,478,000 accounts in collection. That amount has increased to over 14,000,000 in 2017! Why the large increase? Well, I think it may have something to do with the “Great Recession” of 2008-2009. Some people lost everything and haven’t paid anything towards their debt. Others may just be starting to catch up. Most of these collection accounts already have tax liens filed and the taxpayer may have no idea. If you own a home, there may be a tax lien on it. How do you handle these situations? The first thing to do is NOT to ignore the IRS notices. If you don’t understand what the notice is telling you to do, give us a call. Waiting and doing nothing will only hurt you in the long run. The IRS has a successful record of finding people and their assets.
I’ve seen the IRS become very aggressive to clients who don’t respond to their letters. Besides taking money out of your bank account, if you’re self-employed, they may contact 3rd parties or vendors inquiring about your business. This always leads to uncertainty and in some cases, the 3rd parties don’t want to do business with you any longer. This doesn’t have to happen! Know your rights and consult with an expert.
Another point to remember is to NEVER give your financial information to someone claiming to be the IRS or Department of Revenue asking for payment. Neither will call you and ask for money. Hang up on them immediately. Also, you will not be arrested over the phone. If you are being investigated for criminal tax fraud, the IRS will show up at your home or work with identification.