IRS Audit

Our government is able to meet its operational needs because you pay your taxes. And if you fail to pay taxes the government starts the process of recovery. IRS audit is an integral part of the recovery.

As we all know, if the government does not get enough money from the people, the concept of welfare state would be lost and the security provide by the state will also suffer.

However, recovery of taxes can certainly be nightmarish for the one from whom the taxes are recovered. If you have not paid your taxes for a long time, you might get an IRS lien on your property. A lien limits your right to your property. However, a tax lien does not actually take you property away from you. Your property remains very much yours.

However, if even after the tax lien you do not make an effort at settling the tax issues with the IRS and pay the taxes due, the IRS takes the next step. And the next step is IRS levy. IRS levy is notorious for it tortuous effects on the taxpayer concerned.

The first IRS levy you get would be a bank levy. The IRS would ask your bank to freeze your account and your bank will have to promptly comply. After your account is frozen you'll not be able to get a penny out of it. And within 21 days the money in your account will be sent to the IRS. You can survive this levy only if your bank account has more money than you owe to the money by way of taxes.

After the bank account, it could be anything from your house to your car. And it continues till the taxes are fully recovered. So, the best way to avoid it is to act the moment you get notified of the tax lien. Get in touch with the IRS and talk to a tax attorney. Tax professionals know well as to what works with the IRS.

Negotiating through a tax professional would help you get a better deal from the IRS and you'll be spared the pain that comes in with a levy. Before you approach the IRS or the attorney or a tax professional, make sure that you know everything about your own tax liabilities so that what you owe to the government is indisputable. And if you think you do not owe as much as the IRS says you do, it becomes even more important.

The notice pertaining to a tax lien must never be taken lightly because after the lien, the levy comes and that can be difficult and problematic to deal with. The levy is followed by an IRS audit, which is indeed a situation where things have already gotten difficult. So, avoid the situation by acting promptly.