RReceiving a letter from the Internal Revenue Service (IRS) is never a pleasant experience. While in most cases a letter from the IRS indicates that you need to file more paperwork to supplement your tax filings, the organization is also notorious for sending letters where the content of said letter indicates that you owe United State Treasury money.
If you find yourself on the wrong side of the IRS, it’s imperative that you get your debt sorted out ASAP. It is estimated that the average IRS tax (grab) is approximately $1,600 mostly by bank accounts and wages.
Moreover, the IRS also has the power to dip into your bank account on multiple occasions until the debt is paid off, which means you suddenly find yourself struggling to make ends meet.
However, it is important to note that this is a last resort and the IRS will provide several warnings before delivering the amount owed to you.
Federal tax privileges
A federal tax lien is a claim against you that arises by law when you have an outstanding debt amount with the United States Treasury. It is important to avoid this claim, as foreclosure will have a negative impact on your credit rating.
Furthermore, it is also important to remember that declaring bankruptcy does not invalidate the franchise.
Exempt assets
Fortunately, there are some assets that the IRS can’t seize in a worst-case scenario. These items include basic necessities such as clothing (luxuries and designer items are not protected), textbooks, fuel, provisions, furniture, personal belongings up to $7,700 and more.
It’s also important to note that the IRS will not touch 85 percent of your unemployment benefits.
Finally, although not ranked on the previous list, the IRS is generally discouraged from seizing your retirement plans and homes.
Cars can also be considered prohibited but you will need to convince the collector that your car is essential to the business.
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