Editor’s Note: This post was originally published in June 2013 and has been updated for accuracy and comprehensiveness.
When you are seriously negligent in paying your IRS tax debt, you put your income and assets at risk of being seized. The IRS uses this extraordinary step to collect on debts when taxpayers have failed after repeated warnings to pay what they owe.
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The scariest thing people consider when they owe back taxes is that the IRS will take their house. While it isn’t untrue, it’s still relatively rare for the federal government to seize property, particularly real estate.
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Under normal circumstances, creditors are limited when it comes to the amount of money they can take from your paycheck after a garnishment order has been issued. However, the IRS is not bound by normal garnishment protocol and thus can garnish your paychecks without a court order and without abiding by standards to which other creditors must adhere.
Do you owe an outstanding tax balance to the Internal Revenue Service? Taxpayers who are in arrears on their tax payments may be at risk for losing their assets in an IRS seizure. In some cases, this could even include an automobile, particularly if the vehicle has a great deal of value. Here's a look at when and how the IRS could seize an automobile from a taxpayer.
Most taxpayers have heard horror stories about the IRS taking possession of someone's assets and they may fear that this could happen to them. While it's true that the IRS has the authority to seize individual assets, this only happens in situations where a taxpayer becomes seriously delinquent on their account and doesn't take any steps to clear up their outstanding tax balance. In these cases, the agency may issue a tax lien or a tax levy. How can you prevent the IRS from seizing your assets?
Did you know that the IRS has the authority to seize your assets if you owe back taxes? The Internal Revenue Service is one of the most powerful government agencies when it comes to seizing control of individual assets so it's wise for any taxpayer to understand the agency's authority and how it exercises asset seizure in cases of income tax debt.
