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Taxation can be a complicated and stressful matter, particularly when it comes to tax levies and liens. If you are facing a tax issue, it is important to understand your rights and how to navigate the complex tax system. In this comprehensive FAQ, we will explore the ins and outs of tax levies and liens, and how Mike Habib, EA a tax relief professional can help you resolve your tax issues.
Q: What is a tax levy (garnishment/attachment)? IRS-FTB-CDTFA-EDD
A: A tax levy is a legal action taken by the government to seize assets in order to pay a tax debt. This can include garnishing wages, levying bank accounts, and other property, such as a house or car. A tax levy is different from a tax lien in that it is a direct seizure of assets, whereas a lien is a claim on assets that must be paid off before the property can be sold.
Q: How does a tax levy (garnishment/attachment) work?
A: The process of a tax levy begins when the government sends a notice of intent to levy to the taxpayer. This gives the taxpayer 30 days to take action to resolve the tax debt, such as paying the amount owed in full or negotiating a payment plan or offer in compromise. If the taxpayer does not take action, the government can proceed with the levy, seizing assets to pay the tax debt.
Q: What is a tax lien? IRS-FTB-CDTFA-EDD
A: A tax lien is a claim made by the government on a taxpayer’s property such as real estate to secure payment of taxes owed. The lien acts as a notice to creditors that the government has a legal right to the property if the taxes are not paid. Tax liens can possibly have a negative impact on a taxpayer’s credit score and make it difficult to obtain financing or sell property.
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Q: How does a tax lien work?
A: A tax lien is typically filed after the government has sent a notice and demand for payment to the taxpayer. If the taxpayer does not pay the debt, the government can file a lien on the taxpayer’s property, which serves as public notice of the debt. The lien remains in place until the debt is paid or the statute of limitations expires.
Our Whittier, Los Angeles, CA tax representation firm represents individual and business taxpayers before the IRS & Appeals, contact us today at 1-877-78-TAXES [1-877-788-2937].
Q: What are the consequences of a tax levy or lien? IRS-EDD-CDTFA-FTB
A: The consequences of a tax levy or lien can be significant and long-lasting. A tax levy can result in the seizure of assets, including wages and bank accounts, making it difficult to pay bills and support oneself. A tax lien can have a negative impact on a taxpayer’s credit score, making it difficult to obtain financing or sell property. Furthermore, a tax lien can remain on a taxpayer’s record for up to 10 years, even if the debt is paid in full.
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How can I avoid a tax levy or lien?
The best way to avoid a tax levy or lien is to stay current on your taxes and pay what you owe on time. If you are unable to pay your taxes in full, it is important to contact the government or a tax professional and discuss your options for resolving the debt, such as a payment plan or offer in compromise.
Q: Can a tax levy (garnishment/attachment) or lien be removed?
A: Yes, a tax levy or lien can be removed under certain circumstances. For example, if the debt is paid in full or if the statute of limitations expires, the lien will be released. If the taxpayer can prove that the lien was filed in error, it can also be removed. In some cases, a professional may be able to negotiate with the government to have the levy or lien removed.
What is an offer in compromise? IRS-FTB-CDTFA-EDD
An offer in compromise is a program offered by the government that allows taxpayers to settle their tax debt for less than the full amount owed. This option is available to taxpayers who cannot pay their taxes in full and can demonstrate financial hardship.
Q: How can a professional help resolve tax issues?
A: Dealing with IRS, FTB, EDD, CDTFA tax levies and liens can be a complicated and stressful process. Hiring a professional, such as a tax attorney or enrolled agent, can help ensure that your rights are protected and that you receive the best outcome possible. A professional can assist in negotiating a payment plan, making an offer in compromise, or even challenging the validity of the tax debt. With their knowledge and expertise, a professional can provide you with peace of mind, help you navigate the complex tax system and reach a favorable resolution.
Our Whittier, Los Angeles, CA tax representation firm represents individual and business taxpayers before the IRS & Appeals, contact us today at 1-877-78-TAXES [1-877-788-2937].