There are many individuals who are facing a tough time paying their bills and are failing to pay their taxes on time. It may be because they have suffered loss in business or have been ignoring to pay the taxes due to any other reason. Failure in tax payment is considered to be a serious offence, which has serious consequences. The defaulters might have to face tax lien, wherein, the government seizes their real estate property, retirement accounts, brokerage, and savings account. If the tax lien is filed, the individual's credit rating would be affected and he/she will not be able to buy or rent a house, rent an apartment or sign a lease. For such individuals, debt relief services from the specialised firms, is the only ray of hope.
Many companies or individuals file for bankruptcy and it is the only option for them that seems feasible. Now-a-days due to the poor economic scenario bankruptcy has become a common phenomenon. As per the federal laws bankruptcy is designed to help the individuals who are deep stuck in debt. Liquidation and reorganisation are the two different types of bankruptcy. The chapter 7 denotes liquidation bankruptcy while chapter 9, 11, 12 and 13 are for reorganisation. The process in a bit complex and to understand it completely, individuals must seek professional help from the bankruptcy lawyers.
The tax collection process is triggered by the Internal Revenue Services or IRS, sending three consecutive letters, if the first and second letter is not responded to. Later, the IRS authorities contact the defaulter on phone or they send their representatives to have a one on one conversation with the defaulter. The officer who contacts the defaulter is basically the revenue officer; he contacts the relatives, friends, business associates, employers, colleagues and co-workers of the concerned person and find out the ways of tax collection.
There are many companies who help defaulters in finding out the better ways of tax payment. These companies have specialised professionals who already have the experience of working with the IRS. Before offering their suggestions, the debt relief officers understand the defaulter's actual financial condition. By using the guidance and knowledge of these professionals, the defaulters can save their properties. The bankruptcy lawyers negotiate with the IRS agents as a result of which the defaulters sometimes get more time for payment or they are able to save their properties. Sometimes, if the tax lien is already imposed, the professional representation might help the defaulters in releasing the same.