The purpose of this notice is to inform the taxpayer of a potential tax levy or lien to pay off your tax debt.
From the date listed on the notice (not the day you receive it in the mail), you are allotted thirty (30) days to eliminate the debt, whether it be paying the amount in full, setting up an installment agreement, or applying for an Offer In Compromise (OIC).
An installment agreement allows the delinquent taxpayer to make monthly payments (with a small interest fee, typically less than 1%) until the debt is paid in full.
In the case of an Offer In Compromise, the IRS presents a “counter-offer” of a significantly smaller amount to the taxpayer, due to the taxpayer’s claim of “financial hardship” or other reasonable situation that would qualify their tax debt as unfair.
Here is what you can expect to find on these letters:
- A statement outlining their previous attempts to reach you
- The potential demonstration of their right to perform a tax levy, tax lien, or wage garnishment, due to your lack of compliance
- Instructions on how to prevent collection action
Some taxpayers may still receive this letter if they have already paid their debts, and if you are one of them, your situation is just as serious.
Do not hesitate; call the IRS immediately to plead your case. Receiving this letter indicates that you are still a delinquent in their system, and will roll out collection actions if no intervention is made.
If you or someone you know received this letter intentionally or unintentionally, we strongly encourage you to speak with a CPA or other tax professional as soon as possible.