Avoid tax liens by coming clean
When Atlanta residents encounter tough economic times, it can be difficult to find the funds to pay for basic expenses or to stay current on bills. For some, this means figuring how which payments can wait and which cannot and trying to prioritize and pay off the most urgent bills. Many people make the mistake of thinking that taxes are not a particularly urgent bill, believing what they have heard second hand or from a friend that the IRS is slow to react and may never notice a year of a missing income tax return.
That is more myth than truth, unfortunately, and even when it takes a few years, the IRS’s meticulous recordkeeping will eventually discover the omission and when they do, there may be serious consequences beyond simply paying back the taxes.
Some people think that if they did not file for one year that it is easier to avoid detection by not filling for a second or third year in a row, and eventually the avoidance can snowball. Sometimes a notice that comes in the mail from the IRS will show a high amount that is due, but that will not include relevant deductions like mortgage interest or student loans.
People who have fallen behind on their taxes for one reason or another do have some options, however, to get back on track and avoid serious penalties from the government. Like other creditors, the IRS will often work with taxpayers on a payment plan and schedule to make it easier to meet a tax obgliation.
Without going through the proper process to settle a tax debt, borrowers could face asset reposession, wage garnishment, fines, or potentially time in jail.
Source: Reuters, “Coming clean on your taxes,” Amy Feldman, May 14, 2013
