Did you know that the brunt of your taxpayer dollars goes toward Medicare, Medicaid, and CHIP at 26%, followed closely by social security at 24%? This information might make you have an easier time filing and paying your taxes. Most people who don’t file and pay their taxes sleep easy because they think nothing will happen to them and this couldn’t be further from the truth.
If you thought you can get away with not paying taxes you should know that the IRS has the right to place a bank levy on your bank account or a tax lien on your property. What is a bank levy? The government can simply order your bank to use all the incoming money in your account to pay taxes even without consulting you. Alternatively, the government can take possession of any property belonging to you until you clear your tax debt and this is known as tax lien.
What Can You Do To Get a Tax Lien Released?
If you find yourself in this predicament, the first thing you should do is hire the best tax attorneys. Tax attorneys are trained to deal with this kind of dire situation where you cannot get yourself out. The attorney will look at your situation, how much money you owe the government and advice you on the way forward. Some of the solutions he will suggest include:
- Offer in Compromise: The fact that your tax issues have gotten so dire means you cannot be able to pay the entire debt. In this case, your tax lawyer will apply to make an Offer in Compromise with the tax body. This offer should allow you to pay a percentage of the money you owe them instead of the full amount. It is basically a discount offer where the government forgives some of your debt because of your situation.
- Installment Agreement: If your lawyer cannot show proof that you qualify for the Offer in Compromise, he can apply for an Installment Agreement where you will pay your debt slowly in installments. Unfortunately, your debt will continue to increase because you are still being charged interest.
- Payment Extensions: Tax attorneys are excellent negotiators who can help you get an extension if you just need some time to pay your taxes. The people at IRS understand you could be going through a sickness, death or business challenge and you will sort them out after that, in that case, you can be given an extension of 120 days to clear your taxes in full or 60 days if you already have a bank levy or tax lien.
- Currently Not Collectible Status: Sometimes, you may not be able to pay your taxes even if you wanted because your financial situation doesn’t allow. Your tax attorney will need to show that you cannot be able to pay tax and pay for your living expenses. You will then be granted a currently not collectible status that will protect you from tax lien or bank levy but your tax debt and penalties will still be accruing.
Due to the stress of being hit with a tax lien or bank levy, you may not be able to think that a personal loan will clear your tax debt. However, when coming up with ways on how to stop a levy on your bank account, tax attorneys are in a position to advise you to take this route if they assess your finances and see it fit. The advantage of taking a personal loan to pay the tax debt is that it will stop growing and earning hefty interest and penalties. Once you get that stress off your shoulders, you can now focus on paying your personal loan monthly without stress.