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What You Need To Know About IRS Tax Debt

By Orkhan Ibadov

Republish: EasyPublish™ Published: 07Jan2012 Word count: 472 Viewed: 74 time(s) Get Free Content For Your Site

IRS tax debt is not an ordinary debt. It has extreme inconveniences with devastating effects unless paid. This debt will cause headaches and affect livelihood. Therefore, a better understanding of this debt would greatly help to prevent future problems.

An ordinary debt is when one person owes money from another person. For example, Mr. A borrows money from Mr. B. The money owed by Mr. A is an ordinary debt. This debt may also bring problems in the future if not paid. First, the creditor can persistently go after the debtor for payment of the debt when it is not paid on time. Second, the creditor may avail the services of lawyers and collection firms to harass the debtor. Lastly, depending on the amount borrowed, the debt may sometimes reach litigation stage.

The IRS is a United States government agency under the Department of Treasury. It is an arm of the government for Tax Administration purposes. Its objective among others is to enforce tax laws. It is the government representative which goes after those who fail to pay taxes, intentionally or unintentionally. While it is called IRS tax debt, the debt is not owed from the IRS but from the government.

An IRS tax debt is not an ordinary debt due to the following facts:

1. A tax debt is owed to the state;
2. There is no act of borrowing which precedes the debt;
3. The debt has extraordinary remedies for collection;
4. The payment of taxes is an obligation of the people to the government.

The IRS tax debt, which is owed to the government, is collected by the IRS. In the collection of the tax, IRS has various options and method of collection at its disposal. Some are modest, but some are extreme. The modest type of collection is when the IRS simply acts like an ordinary creditor. Like an ordinary creditor, it may call the taxpayer for payment, make personal meetings for follow-ups of the payment or send letters to inform the taxpayer of the tax due.

The IRS tax debt may result to the extreme method of collection. Among the extreme methods is the tax levy. This kind of collection is not available to an ordinary creditor unless he avails the services of the courts.

The tax levy is considered extreme because it indiscriminately goes after the property of the taxpayer with IRS tax debt. Unfortunately, the taxpayer has little option to stop the IRS from using this option of collection.

The consequences of an IRS tax debt are too many. It is, therefore, recommended preventing it from the start. It is a hassle to owe an ordinary debt, but it is worst to incur a tax debt.

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