Unfortunately, the IRS can seize your assets if you don't pay your taxes. There are only a few types of assets that cannot be seized. The IRS cannot seize real estate and your car cannot be impounded if it is used to get to and from work. Nor can you garnish the money you need for basic living expenses.
Is there a way for a taxpayer with income to take a break? In fact, quite a few types of income are considered tax-free. These are 18 types of income that the IRS can't touch. The government program provides monthly benefits to low-income people who are 65 or older, blind or disabled. The Social Security Administration administers the Supplemental Security Income (SSI) program, but your money comes from general U.S.
Treasury funds, not from the Social Security trust fund. SSI payments are not taxable. Publication 525, Taxable and Non-Taxable Revenue. Internal Revenue Service.
Publication 17, Your Federal Income Tax. Publication 547 (201), Victims, Disasters, and Thefts. The IRS can collect (garnish) assets such as salaries, bank accounts, Social Security benefits, and retirement income. The IRS can also seize your property (including your car, boat, or real estate) and sell it to satisfy the tax debt.
In addition, any federal tax or state income tax refund due to you in the future may be garnished and applied to your federal tax liability. Paying taxes is an important and often complicated responsibility. If a taxpayer doesn't meet their tax obligations properly, the Internal Revenue Service (IRS) can take several steps. In some situations, the IRS may even seize part of the taxpayer's wealth and personal property to satisfy their tax debt.
If the IRS has contacted you with a concern related to tax liability, you should speak with an experienced tax lawyer to get the legal guidance and help you need. Many people don't realize that the federal government can seize some of a person's assets if they don't pay their taxes. If you have an unresolved tax debt, the IRS may eventually use a tax to collect the back tax. Before the IRS issues a garnishment, it will send you a “Notice and a Demand for Payment”.
If you don't respond, you'll receive a “Final Notice of Intent to Collect” and a notification of your right to a hearing. If you still don't resolve the debt or reach an agreement with the IRS to pay it off, the IRS may be allowed to take possession of your property. The listed results do not guarantee future results. The use of the Internet or this form to communicate with the firm or with any individual member of the firm does not establish an attorney-client relationship.
If you can prove to the IRS that the asset they are trying to garnish would not be worth it, then the item can be declared exempt and the IRS will no longer pursue it. Usually, you'll have to show that the effort it would take to sell the asset would actually cost more than the asset would eventually be sold. You can also request that an asset be claimed as exempt if you can show that the asset will prevent you from working. Often, the IRS may try to seize assets such as cars, trucks, tractors, etc., that may be needed to do their jobs and earn money.
If you can prove to the IRS collector that this asset is necessary to make money, you can likely get an exemption for that asset. .