IRS tax negotiations

Rick represents clients in Rockford, Loves Park and across Winnebago County from his office at 7111 N. Alpine Rd, Loves Park.

What Rick handles

• Payment plans and installment agreements with the IRS
• Offers in compromise
• Reading the IRS notices with you and finding the closest deadline
• A final levy notice (an LT11 or a Letter 1058), and the 30 days to ask for a hearing
• Wage levies
• Dealing with the IRS for you, once his Form 2848 is on file

How IRS collection moves

IRS collection runs on letters, and the later ones carry deadlines. First comes the tax bill, a Notice and Demand for Payment. If it stays unpaid, the IRS sends a final levy notice that tells you of your right to a hearing, at least 30 days before it levies. The number is printed on the letter: it may be an LT11, a Letter 1058 or a CP90. You have 30 days to ask for a Collection Due Process hearing on Form 12153, counted from the date printed on the letter, not the day it reaches you, and a phone call to the IRS does not extend that time (IRS Publication 1660). After that, a levy can reach wages, bank accounts and property.

Interest keeps running the whole time, and so does the failure to pay penalty, up to 25% of the unpaid tax. That penalty is 0.5% of the unpaid tax for each month, and it rises to 1% a month if you do not pay within 10 days of a notice of intent to levy (IRS). Every month spent not opening the envelope costs money.

Before you pay or call, make sure the letter is real and find its deadline. Got a letter from the IRS

Questions and answers

Owe more than you can pay at once? Owe the IRS more than you can pay

• Can the IRS garnish my wages?
• How much warning does the IRS give before a levy?
• What is an offer in compromise?
• What does an offer in compromise cost to apply for?
• What does an IRS payment plan cost?
• Can I set up a payment plan online?
• How long can the IRS collect a tax debt?
• Should I file my return if I cannot pay?
• Can a lawyer deal with the IRS for me?

When to call

When the IRS letters start, not after the last one. Opening the envelope is the hard part; the earlier Rick sees the notices, the more choices you have about what to do next. If you have an LT11, a Letter 1058 or any letter that says you have a right to a Collection Due Process hearing, call this week. For a levy notice (an LT11, a Letter 1058 or a CP90), the 30 days run from the date printed on it; a lien notice (Letter 3172) prints its own deadline date. A CP504 is an earlier notice of intent to levy without that hearing right; call about that one too.

What to have ready

Every letter the IRS has sent you, with its envelope if you kept it, your tax returns for the years in question, and a list of your monthly income and expenses.

The first conversation

Rick reads the notices with you, works out which stage your account has reached and which deadline is closest, and tells you which of the IRS options fit the numbers you brought.