Things To Know Before going for Collection Due Process

If the Internal Revenue Service (IRS) debt that you have outstanding has not been settled, the IRS will carry out recovery actions against you. The IRS employs two principal forms of individual collection: (1) NTFL (Federal Tax Lien Notice) and (2) filing of bank levies. For the collection of debt, the IRS might potentially go for a salary garnishment that is a levy. If the IRS has sent you notice for collection of debt, you should immediately consult a tax law firm Virginia Beach.

You can submit a request for a collection due process (CDP) for hearing and suspend collection efforts awaiting the hearing at CDP if you do not agree with the amount of tax that the IRS believes you owe.

Understanding the Collection Due Process Request

According to the IR Code, Section 6320, if the IRS officer has filed a tax liability against you or notified you of the IRS’ intention to file an appeal, you shall have the right to an audience application with an impartial official. IRS collection due letters are two primary types:

IRS Letter 3172 Federal Tax Notification Lien File and Your Hearing Rights; or 1058 Intent Notices To Life and Your right to a listening Notification

When the IRS notification relates to a lien or a levy notice is received, you can request a CDP hearing within 30 days of receiving the letter.

Notice of Federal Tax Lien

A federal tax liability can have a severe impact. If the lien is linked to your home, it will become increasingly hard for you to refinance a property. It may also put prospective buyers off buying your house because everything related to the IRS may make everyone fearful. When the buyer discovers the lien while searching the house for the title, don’t be shocked whether they turn tail and run!

On the bright side, the Internal Revenue Service cannot normally force the homeowner to sale property. However, what the IRS can do is try to get money on it after the property is sold (or shut down).

Notice of Intent to Levy

A levy notice is a significant problem since the financial effect on your life may be imminent. The IRS will attempt to take the cash immediately from your account if you get a Notice of intention to charge your bank account. Suppose you object with any percentage of debt the Internal Revenue Service claims it owes you. In that case, it is vitally crucial that you make a CDP application in the window of 30 days after receiving the notification because the IRS can get the amount of money you have on the account to meet the tax bill if you pay a levy on your bank account. Since dealing with an IRS officer can be stressful, it’s best to hire an IRS Lawyer Virginia Beach.

Steps for filing a Collection Due Process Request

You may submit an IRS Form 12153 Collection Due Process Request or an Equivalent Hearing Request. This form demands that you submit background information and the reasons why you do not feel that the IRS should follow the lien or a statement of intent to collect you. You may obtain a copy of the form from the IRS website with instructions.

If the form is not correctly filled, it will be rejected, and it is essential to remember that the IRS always rejects your form.