Tax Resolution and Tax Preparation

Navigating IRS Collections: What to Do When You Owe Back Taxes

Written by Jake Sterling | May 1, 2025 8:15:00 PM

Owing back taxes can feel overwhelming. The IRS has powerful collection tools at its disposal—wage garnishments, bank levies, tax liens—and ignoring the problem won’t make it go away. The good news? You have options. With the right strategy and legal support, you can regain control and find a resolution that works.

Step 1: Don’t Ignore IRS Notices

When the IRS sends a letter, it’s important to open and respond to it promptly. These notices contain crucial information, including how much you owe and what actions they plan to take. Ignoring them can accelerate collections and limit your options.

Step 2: Understand Your Situation

Before acting, it’s critical to understand:

  • How much you owe (including interest and penalties)
  • What years are involved
  • Whether liens or levies have already been issued

At Amerihope Alliance, we help clients access IRS account transcripts and decode what the agency is really saying.

Step 3: Explore Your Options

The IRS offers several tax resolution tools, depending on your financial situation:

✅ Installment Agreement

Spread your tax debt into manageable monthly payments.

✅ Offer in Compromise (OIC)

Settle your tax debt for less than you owe if you qualify based on income, expenses, and assets.

✅ Currently Not Collectible (CNC)

Temporarily pause collections if you can’t pay anything right now due to financial hardship.

✅ Penalty Abatement

Reduce or eliminate penalties for late filing or payment, especially if you have a good reason (e.g., illness, job loss).

Step 4: Protect Your Assets

If you’ve received a Notice of Intent to Levy or had a lien filed, time is critical. Legal representation can help stop or reverse aggressive collection actions and protect your paycheck, bank account, or home.

Get Help Before It Gets Worse

The longer tax debt lingers, the worse it can get. Interest and penalties continue to grow, and the IRS can become more aggressive. The sooner you act, the more options you have.

At Amerihope Alliance Legal Services, we advocate for clients facing tax trouble, working directly with the IRS to negotiate practical solutions. Whether you owe a few thousand or a six-figure sum, you’re not alone—and we can help.