Unemployed and Owe The IRS?
Wednesday, May 13th, 2009 Subscribe To Our Feed
Times are tough, many are unemployed or underemployed. With the unemployment rate climbing and not much relief in sight, the IRS has authorized it’s agents to go a little lenient on some debtors. Don’t get overly happy, you aren’t off the hook and the penalty and interest clocks will continue to accrue. But the IRS recently gave its collection people the authority to suspend collection activity on taxpayers who are in financial trouble. If you request such a suspension, you’ll be interviewed by a collection agent. If he or she determines that you are not able to pay your tax debt they may suspend collection activity until your financial condition improves. All this means is that they will not hound you and probably will not try to seize your assets to settle the liability. You should be aware that they can, and probably will, still file a Federal tax lien against your assets. This will prevent you from selling any assets, including your home, without paying Uncle Sam first, or possibly from the proceeds of the sale. When your financial picture gets better you’ll be expected to come to settlement terms to pay your IRS debt. It’s not clear how aggressively they’ll treat your case at that point. You can bet that they’ll push pretty hard. There are also no formal guidelines regarding what conditions define an improvement in your conditions. It’s conceivable that as soon as you get full time employment you’ll be expected to get on a payment schedule of some kind. This is, at least, a respite for people who already have enough stress in their lives. So what do you do if the collection agent won’t cooperate with your request? Contact the Taxpayer Advocate. The Taxpayer Advocate Service, or TAS, is an independent organization within the IRS whose employees assist taxpayers who are experiencing economic harm, who need help resolving tax problems that haven’t been resolved through normal channels, or who believe that an IRS system isn’t working as it should. For example, if you’re experiencing financial problems and could soon be evicted if you don’t pay the rent, the TAS may be able to assist you in obtaining your refund quicker or they may be able to assist you if you have experienced a delay of more than 30 days to resolve a tax-related problem. The service can help taxpayers whose problems are causing financial difficulty or significant cost, including the cost of the professional representation of attorneys or CPA’s. The people at TAS know the IRS and how to navigate it. They’ll listen to your problem, help you understand what needs to be done to fix it, and stay with you every step of the way until your problems are resolved. The service has at least one local taxpayer advocate in each state, the District of Columbia, and Puerto Rico. service is free, confidential, tailored to meet your needs, and available for businesses and individuals. This is your voice at the IRS. I want to caution you not to think of this as a replacement for paid representation. You will, without a doubt, be better served by a paid professional when dealing with the IRS. IRS-Back-Taxes.info” href=”http://fixtax.info”>Check FixTax.info for some firms who represent taxpayers. That being said, not everyone has the resources to pay, and for them, this is a valuable service. Just never forget that taxpayer advocates are IRS employees who will not always take care of your interests the way a paid representative will.
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