IRS Payment: Freelance Workers must Beware of the IRS Bank Levy or Tax Lien
IRS Bank Levy & Tax Lien problems can be avoided with timely IRS Payments. Be cautious and heed the warnings of this story…
IRS Bank Levy Advice: Be careful when it comes to advice on an IRS Payment or an IRS Bank Levy and/or Tax Lien could be in your future. Let's take Ruth's scenario as an example. Ruth is a freelance web designer, and she gives a discount to nonprofit organizations. Her friend is a Certified Public Attorney, he told her it was legal for her to claim the difference on her Tax Returns to reduce her IRS Payment. Two years later, the IRS sent her some notices… Now she has an IRS Bank Levy and a Tax Lien to contend with. All of this simply because she wanted to reduce her IRS Payment!
Don't Ignore your IRS Payment: Out of Sight, Out of Mind. Ruth knows she needed to make her IRS Payment, but she ignored an IRS notice. Two more notices from the IRS came and went without her acknowledgement. She even ignored a letter reading, "Final Notice and Intent to Levy." This was the final notice before the IRS Bank Levy & Tax Lien came…
Bank Freeze, IRS Bank Levy Hits: Ruth was shocked. The Bank told her bank account was devoid of funds. Frantic, she demanded to speak to the Manager. He told her the bad news. The IRS has frozen her bank account. And there's nothing he can do to help her. This is known as an IRS Bank Levy. All of this simply because she didn't make her IRS Payment! Without the IRS Payment the IRS was forced to seize funds with an IRS Bank Levy and issue a Tax Lien.
What Went Wrong- No IRS Payment:Ruth's freelance gig was her side job. She did well the first year. The next couple of years, she actually lost money. The IRS was tricky and took advantage of a loop hole. Since her small business had lost money for two years, her business was reclassified as a hobby! So that money she claimed on her Tax Returns two years ago now needed to be paid back- with interest! She ignored the notices sent to her and didn't make an IRS Payment. The IRS then slapped her with Tax Lien and an IRS Bank Levy.
Make an IRS Payment to avoid Tax Lien: Ruth tried to call the IRS to make an IRS Payment. But IRS Hit-men were not sympathetic. They only told her she needed to make an IRS Payment ASAP. They would not remove her Tax Lien. She asked to be transferred to a manager that could help her, but it was always the same thing. The person on the other line told her that the money was due. She didn't know what to do or who to turn to. With a Tax Lien and a recently enacted IRS Bank Levy, she didn't have many options.
Getting Help with a Tax Lien: Every month that passed without an IRS Payment, Ruth's bill grew larger. The Tax Lien was suffocating, she couldn't do anything involving credit. Desperate, Ruth decided to call a Tax Professional to help her arrange the best IRS Payment. The Tax Professional let her know that because she was given bad advice by a professional, she qualified for Penalty Abatement as an IRS Payment option. With the penalties and interest dropped, it was much easier to pay off her IRS Debt. Soon the Debt and the Tax Lien were removed. As long as Ruth stayed current with the IRS and avoided future mistakes, she'd never have to worry about IRS Bank Levy problems or a Tax Lien in the future!
Watch Out For IRS Bank Levy & Tax Lien problems! Be careful. You have to think before you act if you want to avoid a Tax Lien or an IRS Bank Levy. Even IRS workers can give you the wrong advice! Make sure that you research any action you do with the IRS very carefully, and always make your IRS Payment on time! If you don't, you could end up buried in debt! Don't let anything as simple as an IRS Payment bring a Tax Lien into your life!
