If you think the IRS is only focused on tracking down people with six-figure incomes or businesses with millions in revenue that don’t pay taxes as they should, you’re wrong. Theirs are the only cases well-publicized, but there are thousands of other taxpayers that get in trouble with the IRS for failing in their tax duties.
If you do incur back taxes, serious consequences could spring up on you, and they could affect your life in several ways. Here are a few of the biggest financial aspects of your life that can be negatively affected by tax debt:
Your Credit Score
Owing the IRS (or any other authorized creditor for that matter) and letting the debt go unpaid for too long, you’ll eventually find it tough to qualify for a good credit card, house or car loans, and other financing options.
The IRS can also collect portions of your salaries, also known as wage garnishments, which means you can receive very little from your employer and get paychecks that are only enough to let you scrape by until the next one. They can also levy your bank accounts (i.e. use the money to clear your balance).
Your personal or business properties can also be seized and/or sold until your debt is cleared.
Don’t let your debt rule your life. Talk to an experienced IRS tax attorney to start planning how you can tackle the debt and get rid of it through negotiations with the IRS.