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When Should You Appeal an IRS Collection Action?

Appealing an IRS collection action can be a smart choice in many cases. You can delay the lien, levy, or wage garnishment while also getting the opportunity to negotiate a more favorable outcome.

Stopping a Lien or Levy

By requesting a Collection Due Process (CDP) hearing, you temporarily stop the pending lien or levy. The IRS can only levy your property before a CDP hearing in a few situations:

  • Collection of the tax is in jeopardy
  • The levy is of a state tax refund
  • Disqualified Employment Tax Levies
  • Federal contract levies

If one of those exceptions doesn’t apply, the IRS can’t levy until 30 days after you receive the CDP notice. If you request the CDP hearing, the levy is furthered delay until your appeal is resolved.

The Collection Appeal Program (CDP) works in a similar way. If the IRS was about to terminate your installment agreement, that action will be delayed until your appeal is complete.

Find a Better Resolution

Even if you don’t dispute how much you owe the IRS, you can generally find a better resolution then letting your assets or wages be levied. The IRS only pursues these actions when you fail to resolve your tax problems voluntarily.

For example, a single taxpayer with no dependents can be left with $1,016.67 per month if the IRS garnishes your wages. All the rest of your paycheck will go towards your tax debt, including on bonuses or commissions you receive.

If you negotiate an installment agreement, you may end up paying much less per month to the IRS. And if you earn a big bonus or commission, you’ll get to keep the proceeds.

Get a Second Opinion

If you’ve requested an installment agreement or lien discharge that has been denied, you may want to speak to a different IRS employee. IRS Appeals is a separate office, so they may view your case differently than the Collections office.

The Appeals office may be more flexible and willing to make a deal. If you have a strong argument for why your request should be granted, you may just need to talk to a different person to make your case.

Contact a tax attorney for assistance requesting an appeal and avoiding IRS collection actions.

Get help with IRS appeals by calling The Gartzman Law Firm at (770) 939-7710. We can listen to your concerns and help you find the best tax resolution strategy for your case.