For years, the overwhelmed IRS didn’t have enough power to properly enforce tax laws and collect unpaid taxes due to the COVID-19 pandemic. In late 2023, the IRS has restarted automated collection notifications. Then, its brand-new special reminders went out starting in January 2024. Starting this August, the IRS massively mailed out the Final Notices of Intent to Levy and Hearing Rights.
As a tax relief professional, I feel the imminent tidal wave of the IRS collection enforcement activities. This important communication is the IRS’s way of informing you about their intention to take action on your property. It’s crucial to understand the implications and respond promptly to avoid serious consequences.
What is IRS Letter 11 or CP90: Final Stage Before the IRS Can Levy
Letter 11 is a formal notice from the IRS stating their imminent plan to levy your property. This document serves as a legal notification, similar to other IRS letters like CP90 and LT1058. It’s essential to recognize that this letter grants the IRS the authority to potentially seize your assets within a 30-day timeframe without considering their additional wait period.
Time is of the Essence: Responding to Letter 11 or CP90
Upon receiving Letter 11, you have a limited window of 30 days to take action. The IRS clearly states the deadline for your response on the left side of the letter, alongside the amount you owe. If the taxpayer doesn’t pay their taxes in full or they don’t contact the IRS to address this notice by the specified date could result in severe consequences, including the IRS placing a lien on your assets or initiating seizure procedures that includes hitting wage garnishments, levying bank accounts, and placing restrictions on the passport.
The Risks of Inaction
Ignoring Letter 11 or CP90 or refusing to pay can lead to serious repercussions. Not only does the IRS have the right to seize your assets, but you may also face the possibility of losing your passport. Under the Fixing America’s Surface Transportation Act, the IRS has the authority to revoke or deny passports for individuals who fail to pay their taxes.
Exploring Your Options
Letter 11 or CP90 typically arrives with an enclosed Form 12153, known as the Request for a Collection Due Process Hearing. This form is crucial if you believe there’s an error in the amount stated on Letter 11 or CP90. By submitting this form, you can appeal the bill, triggering a review process where the IRS assigns an appeals representative to work out your case. In some cases, this appeal may progress to Tax Court.
Can’t Pay the Balance in Full? Consider These Options
If you find yourself unable to pay the full amount, it’s crucial to communicate with the IRS. You need to find out if you are eligible for any of the following resolution options, including Partial Payment or Regular Installment Agreement, Offer in Compromise, Currently Not Collectible.
Seeking assistance from tax relief professionals can be invaluable in navigating this complex collection process.
Stopping or Releasing a Tax Levy
Even if the IRS has already initiated the levy process, there are various methods to halt or release it. Each taxpayer’s situation is unique, and different approaches may be more suitable depending on individual circumstances. For a comprehensive guide on stopping an IRS tax levy after it has begun, consult reliable resources or speak with a qualified tax relief professional such as a Certified Tax Resolution Specialist.
Conclusion
Receiving IRS Letter 11 or CP90 can be daunting, but understanding your rights and options is crucial. Whether you choose to appeal, pay in full, or negotiate a payment plan, taking prompt action is key to avoiding asset seizure and other severe consequences. Remember, professional tax assistance can be a rescue squad in resolving your tax issues effectively and protecting your financial interests.
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