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Tax Appeal Representation and Due Process

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TAX APPEALS AND COLLECTION DUE PROCESS

Income taxes can take a big bite out of your bank account, and unexpected increases can cause serious financial issues. The good news is that you can file a dispute, but you need professional income tax appeal representation to do so successfully.

BC Tax serves clients in Denver, throughout the state of Colorado and beyond with income and other tax appeal services. We can help fight unfair assessments as well as other tax matters, including tax liens and asset seizures.

How Income Taxes Work

Income taxes are withheld from your paycheck based on state and federal income tax rates. When you start a new job, you submit a W-4 form to the IRS that outlines the number of your personal allowances, including children and other dependents.

Your number of allowances determines how much income tax will be withheld from your paycheck. It’s important to check your W-4 every year to ensure all information is accurate, and that the IRS is not withholding more than is necessary.

By April 15, you must file your income tax return and pay any taxes owed. Failure to do so may result in penalties and interest that accrues over time. The failure-to-pay penalty is 0.5 percent of your unpaid taxes each month up to 25 percent, plus interest. The interest rate is equal to the federal short-term rate, which is determined every quarter, plus three percent.

Failure to pay income taxes can quickly increase the amount you owe to the IRS.

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Your Collection Due Process Rights

If you have outstanding tax debt, the IRS may pursue collection methods. The two main types of IRS collections are tax liens and bank levies. You may receive one of two letters from the IRS:

Notice of Federal Tax Lien File (IRS Letter 3172)

Notice of Intent To Levy (IRS Letter 1058)

If you receive a notice from the IRS regarding a tax lien or levy, and you disagree with the amount the IRS claims you owe, you can request a Collection Due Process (CDP) hearing. You have 30 days to request a CDP hearing from the day you receive the notice. Filing this request will cease any collections pending your hearing.

As a taxpayer, you have the right to request a CDP hearing to appeal IRS levies and liens before an impartial officer. This informal hearing happens in person or over the phone, and no oaths are involved.

To file a CDP hearing request, use IRS Form 12153, Request for a CDP or Equivalent Hearing. It’s important to fill out this form correctly and submit it within 30 days to avoid rejection. Working with a tax resolution firm can ensure your CDP request is completed and submitted accurately and on time.

Following the hearing, the IRS will issue a Notice of Determination. You then have 30 days to appeal to the Tax Court or the U.S. District Court.

When to File a Tax Appeal

Have you received threatening collection letters? Do you believe your taxes are excessive? Has the IRS made a change to your tax return that you disagree with?

If so, you may want to consider filing a tax appeal. Take action by partnering with a tax resolution company that’s responsible for helping you get your life back.

BC Tax: Your Tax Appeal Representation in Colorado and Across the U.S.

When you need help with an income tax appeal or a matter related to a tax lien or asset seizure, BC Tax can help. Since 2001, we’ve helped taxpayers in Denver, Colorado and across the country with tax appeal services and representation.

For more information and answers to any questions, call BC Tax at (800) 548-4639 or complete our online contact form.

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