Did you know that there are public digital records of taxpayers who owe back taxes? The taxing agencies in 19 states are required by law to publish a list of delinquent taxpayers (could depend on the amount of tax delinquency). All 19 states include the name of the taxpayer and 18 of the state include the amount owed. Further, 14 of the states also include the taxpayer’s address. These lists are updated and managed according to the laws of the specific state. The Delinquent Taxpayer Lists for the various states are easily accessible on the internet and are intended to encourage those who are on the list (or may be placed on the list) to pay their taxes. If a taxpayer is placed on the list and does not take the necessary steps to be removed from the list, they may face serious consequences. These delinquent taxpayers could potentially have their driver’s license suspended, professional or occupational license suspended, or lose their ability to enter into any contracts with state agencies to acquire any goods or services. Further, some employers monitor the delinquent taxpayer lists and will often terminate employees who appear on those lists.
Delinquent taxes refer to any amount of tax liability owed to the IRS or a state. You are considered delinquent when you miss the due date for a tax return or other established liability has passed and the amount due remains unpaid. Once you become delinquent, penalties and interest will begin to compound on top of the outstanding amount until the entire balance is paid in full.
Ignoring your delinquent taxes can result in severe consequences. The IRS or state taxing agency may issue an assessment and then a tax warrant covering all unpaid tax, penalties, and interest. If the tax warrant is not paid within the specified period of time, it is typically filed with a court in the county where you reside. The IRS or state taxing agency can then garnish your wages, or place a tax lien against your property and assets to pay the tax liability. It is imperative that you handle a delinquent tax notice as soon as possible in order to avoid penalties and to prevent liens and garnishments. If you are a delinquent taxpayer, it is best to consult a tax professional who can help you settle the liability.
Here are some general guidelines that you should follow to avoid becoming a delinquent taxpayer: