Back Taxes

Free Consultation For Your Tax Problems, Back Taxes And Unfiled Returns

If you have unpaid taxes, unfiled returns or back taxes and the IRS or the state has sent you a notice that mentions the word 'levy' or 'seizure,' you should call us. That tax agency is about to seize your bank account or pay check if they can find either.

However, you should not wait for the levy notice. You should as soon as possible deal with your unpaid or back tax issues. The situation gets worse the more time goes by.

Unpaid or back taxes can result in simply awful consequences if left unattended.

Penalties accrue along with interest. Generally, penalties for late filing and late payment stop when they each reach 25% of the tax due but the interest continues forever and at 7% the amount due will double every ten years. As there is no statute of limitations that will protect someone who has unfiled returns, a tax of only $1000 in 1988 will amount to over $3000 in 1992.

What Happens When You Don't Pay Taxes Or Have Unfiled Returns?

The I.R.S. reviews all W2's and 1099's that are issued in your name. If the amount is greater than the sum of a standard deduction and one personal exemption the Service will look to see if taxes were withheld.

If it appears the amount of tax withheld is less than the tax owed by a single person claiming one exemption, the Service will create a Substitute For Return (SFR) and will file that SFR in the taxpayer's name as though it were a regular return.

They will assess late filing and late payment penalties equal to almost 50% of the amount of the tax and then they will start to charge interest. As noted above, the amount owed rises to gigantic proportions and can double or triple in size in a decade or so.

Once the tax has been assessed and left unpaid, the IRS will send a series of collection notices with a CP designation - CD 501, CP 502, CP 503 and lastly CP 540.

The latter notice reads in bold type "Urgent, Notice of Intent to Levy" at which point the taxpayer has 30 days to get in touch with the IRS and work out a payment plan of some sort.

This is the Service's final warning. Notice of Intent to Levy is the last notice before seizure of assets.

After that your bank account, paycheck and accounts receivable may be attached.

Contact us for a free consultation and we will help you with your tax problems, back taxes or unfiled returns.

We suggest you do not represent yourself.
The I.R.S. is your adversary in these matters.