: Don't procrastinate with the IRS. You may have received some notices in the mail. They may not look important, but they are. And if you put off dealing with your tax debt long enough, the IRS can unleash it's weapons of collections on you.
Automated Collections 101
: If you ignore the notices the IRS mails you, your account is sent to the Automated Collections System (ACS). This is the area of the IRS that can Seize your assets, Levy your Bank accounts, and Garnish your wages.
: If you ignored your IRS debt, it's probably already too late. But there are certain ways you can buy time.
- Short-Term Hold: This usually doesn't work, but it's worth a shot. You can call the IRS and request a short-time hold. This could be anywhere from one week to 60 days. After you call the IRS, send them a written request for more time along with the photocopy of the notice you were sent. During this time, you need to get into a resolution as quickly as possible. Otherwise, you may wind up in even worse trouble.
- Long-Term Hold: It's even harder to get a hold on your account that is longer than 60 days. You have to call the IRS and ask them to classify your account as a “Hardship Case.” If your situation is truly dire, a reprieve from debt collections for a year. But your have to provide plenty of evidence to support this. You need documents proving you cannot pay your debt. And IRS Hitmen are not known for their sympathy.
: Did the IRS refuse to give you a long-term or a even a short-term hold. Then you have to face the music and find a way to pay your debt. At this stage, it's going to be really tough. You already tried one or two excuses that didn't work and the IRS doesn't like stalling tactics. You may need professional help at this point.
Window of Opportunity
: The key here is acting on your debt as early as you possibly can. If you know you cannot pay your taxes, let the IRS know and research a plan. And respond to an IRS letter as soon as possible. Do this, and you can save thousands of dollars.