What Tactics Does the IRS or State Use to Collect on the Taxes They Are Owed?

That is because the IRS and State are two of the biggest collection agencies in the world, who will almost stop at nothing to collect upon what they are owed.

The IRS or State will use tactics, such as:

• Sending intimidating letters demanding the back taxes they are owed
• Issue out warnings of wage garnishments to collect on back taxes
• Start garnishing a taxpayer’s wages so they can collect upon the back taxes that are owed
• Issue out warnings of tax levies 
• Execute a tax levy on a taxpayer’s bank account for all the money that is currently in it, along with any future deposits, up to the amount that is owed
• Issue out warnings about tax liens
• Place a tax lien on a taxpayer’s business assets, homes, cars, jet skis, and any other possession they could think of
• Suspend a taxpayer’s driver’s license and their ability to drive
• Suspend or revoke a taxpayer’s passport and their ability to travel
• Seize a taxpayer’s business assets, cars, jet skis, homes, or anything else they could get a hold of, to repay the tax debt that is owed

These consequences are no joke, and any stress, fear, anxiety, or negative feelings are completely justified, when the IRS and State have the authority and the power to do any or all of what is aforementioned.

This leaves many taxpayers quite pessimistic and potentially hopeless. 

Is There a Plausible Way to Find Back Tax Relief From the IRS or State?

The biggest question a taxpayer may face in a situation where they fall behind on their taxes is whether or not there is a way to get tax relief and to break free from their back tax debt and find tax relief from the IRS or State.

• How do some people owe hundreds of thousands of dollars and then get their back tax debt wiped away?
• Is it possible to completely wipe out my IRS or State tax debt?
• Are tax relief programs legit?
• How could tax relief not be a scam?
• Will the IRS or State actually lower my debt, or eliminate it altogether?
• How do I get approved for a tax relief program?
• What kind of tax relief programs are out there?
• Is there a tax relief program that is best suited for me?
• Why would the IRS or State even consider working with me on my tax debt?
• If I owed someone money, I would want every penny back… So why would the IRS or State not want the full amount?

These questions make sense and it is normal to be skeptical. Seeing anything substantial happen in life makes people skeptical because it’s just the nature of how things work.

Why Would IRS or State Back Tax  Debt Get Removed, Allowing a Taxpayer to Find Tax Relief?

First, let’s start off with why the IRS or State would allow a taxpayer to find tax relief. If you have heard the old adage, “In this world nothing can be said to be certain, except death and taxes,” Benjamin Franklin laid out how life has been and has continued to be. However, as time has progressed, the government realized that not everyone can fulfill their duty to pay back every single penny in taxes that they owe and that back taxes could completely disrupt a taxpayer’s life. That is why as time has progressed, tax relief programs have been introduced to taxpayers in many forms, to help them get out of their underlying back tax situation.

When Did the IRS and State Start Introducing Tax Relief Programs?

In the 1930s to 1940s, installment agreements for back taxes were first introduced, allowing taxpayers to set up payment plans on their back taxes for taxpayers who couldn’t pay their taxes in one lump sum. 

Later in the 1970s and 1980s, penalty abatements were introduced that allowed the IRS to reduce or remove penalties if a taxpayer had reasonable cause for not paying or filing their taxes on time. 

In the 1980s, the IRS introduced a program where they halted tax collection altogether temporarily for those who had experienced severe financial hardship.

Then in the 1990s, a major tax relief program was introduced where taxpayers could settle on their taxes for a lower amount than they owed, sometimes even being pennies on the dollar.

What Are the Chances of Getting Approved for a Tax Relief Program?

It really depends on which specific tax relief program a taxpayer is seeking out. Do you need a simple penalty waived? It would be a lot easier to get this resolved than to get the full balance of what is owed completely dismissed.

Depending on the circumstance, finding tax relief really can become quite a complicated process.

Historically, taxpayers who file for relief on their own to get the majority of their back taxes dismissed, without the assistance of a professional, typically see a lower acceptance rate than when working with a tax professional. While we have a high acceptance rate of saving 93% or more and finding tax relief on large back tax balances, the reason for it is because we take the time to thoroughly go through a taxpayer’s tax debt, assets, income and expenses prior to bringing them on as a client through a free consultation where we assess the taxpayer’s situation beforehand.

Here are some reasons why a taxpayer will be denied a large tax relief settlement when filing on their own:

1. Insufficient Tax Relief Offer Amount: If the IRS or State determines the amount the taxpayer offered is less than what they believe they could collect through other means (like wage garnishment or asset seizure) without any reasonable hardships being presented, they may reject the offer.
2. Inadequate Documentation: If the taxpayer didn’t provide the necessary financial documents or the information provided was inconsistent, their tax relief offer may be denied.
3. Failure to Qualify: If the taxpayer’s financial situation doesn’t meet the eligibility criteria — such as their income or assets being too high in relation to their expenses to qualify for a tax relief offer — the offer could be rejected.