Owing taxes to the IRS can be stressful...especially when the balance is substantial and interest and penalties are adding up. Fortunately, the IRS offers options that make it easier for qualified taxpayers to manage or resolve tax debt without digging deeper into financial hardship.
[Editor's Note: This article was originally published in September 2013 and has been updated for accuracy and comprehensiveness.]
What is the difference between a tax lien withdrawal and a tax lien release?
A tax lien withdrawal removes the IRS Notice of Federal Tax Lien from public record as if it never existed. A tax lien release shows the debt was paid, but the lien remains in public record as “released.” Withdrawals offer a cleaner outcome and are available after payment in full or sometimes through a direct debit installment agreement.
[Editor's note: This article was originally published in July 2018 but has been updated for accuracy and comprehensiveness.]
If you owe the IRS $51,000 or more, unpaid taxes could put your ability to apply for or use a U.S. passport at risk. Thanks to the FAST Act (Fixing America’s Surface Transportation Act), the State Department can deny or revoke passports for taxpayers with seriously delinquent tax debt. Understanding how the FAST Act works—and how to resolve your tax debt—can help protect your passport and your ability to travel internationally.
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What happens if you fail to file your tax return?
The IRS charges a failure-to-file penalty of 5% of unpaid taxes per month, up to 25% of your balance. If your return is over 60 days late, you may owe a minimum penalty of $485 or 100% of your unpaid tax. Filing as soon as possible reduces penalties, even if you can’t pay in full.
If you would like more information about failure-to-file penalties, read on.
[Editor's Note: This article was originally published in November 2012 and has been updated for accuracy and comprehensiveness.]
Many taxpayers who owe large amounts of back taxes to the IRS set up IRS installment plans in an attempt to clear up their accounts. These installment plans can be a convenient way to pay off back taxes without putting an unnecessary strain on your budget. And while an IRS payment plan may seem like a good idea in theory, there are some situations where signing up for this type of plan may not be the best solution. Here are some of the advantages and disadvantages of IRS installment plans.
{Editor’s Note: This post was originally published in June 2012 and has been updated for accuracy and comprehensiveness.}
If you owe back taxes to the IRS, you may face serious collection actions such as tax liens and tax levies. While both are ways for the IRS to enforce payment, they have different impacts on your finances. Understanding how they work—and how to resolve them—can help you protect your assets and financial future.
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If you’re dealing with tax issues, you may have heard the term “tax levy” mentioned as one of the possible actions the IRS can take to collect unpaid taxes. But what exactly is a tax levy, and what types should you be aware of? Let’s walk through the basics so you’ll know what to expect and, more importantly, how to protect yourself.
If you’re facing a visit or call from an IRS Revenue Officer, you might feel a mix of confusion and stress. After all, most of us never expect to deal directly with the IRS, let alone with one of their Revenue Officers. But it can happen to anyone, especially if you have overdue tax debts, haven’t filed tax returns, or are dealing with payroll tax issues. So, let’s walk through some tips to help you manage this situation calmly and effectively.
Editor’s Note: This post was originally published in December 2011 and has been updated for accuracy and comprehensiveness.
If you're behind on your taxes, you've likely heard the term "tax levy" thrown around—but what does it actually mean, and how could it impact you?
Editor’s Note: This post was originally published in February 2012 and has been updated for accuracy and comprehensiveness.
If you're facing an IRS wage garnishment, you're not alone. A recent study by Northwestern and MIT estimates that 1% of workers, or 1 in 100, may be experiencing a wage garnishment during any given pay period. It's important for you to understand what is true and what is false about wage garnishments so that you can take whatever steps are necessary to stop wage garnishments. If you know the truth, you are one step closer to being able to stop IRS wage garnishments. Here are 11 common myths...
