Happy New Year!!!!
I’m not sure about you, but I am struggling to wrap my mind around the fact that we are now, officially in 2022!!!!
If you are anything like me, the incessant adjustment of life as we know it in the midst of a global pandemic is enough to keep your head spinning let alone keeping up with that year we are in! I still feel like an entire year of my life is unaccounted for. Although it significantly commemorates the birth of my child as well as the onset of COVID, constant lockdown, scary times with the absence of produce, staple items, and hand sanitizer not to mention the virus itself… most of 2020 and all of 2021 feel like a blur.
Yet here we are. And I can smell those W2’s!!!!!!
Before you decide to succumb to the tax return flex, please take the time to ensure that your affairs are in order! In the last several weeks, I have met with several clients that either been slapped with a levy (where their wages or bank accounts have been garnished) or a tax warrant. Now, keep in mind that the IRS is ALWAYS running a few years behind in terms of audit and compliance., Add to that the CTC (Child Care Tax Credit) as well as the various economic stimulus packages sent out over the last couple of years, the IRS has been inundated with tax return requests for filers who have not filed in years previous. That’s right, those with income requirements under the $12k annual threshold have all been made eligible for the economic stimulus packages. Thus, filing a return for the years preceding the stimulus grant was a contingency in receiving funds.
WHEW! A mouthful I know! What it all boils down to is don’t be surprised if an audit from 2015 or so surfaces! But don’t stress it there are so many options to handle your business without putting a dent in your financial plans! Levy’s and tax warrants can be tricky so you want to be armed with as much knowledge as possible. Follow these few steps to get it together HUNNY!
Tax warrants and levies do NOT need to be paid in full to be removed from your credit report!
Check with your local IRS state representative to find out if you are eligible for amnesty. You may be able to pay a portion of the tax liability owed, less any interest and fees.
You have 15 calendar days to dispute the levy (and the fees affiliated with it) with your bank
This will require you to complete a W9 and a discharge of property
You may also have to appear before a magistrate to plead your case (in most cases this is a positive move as the fees will likely be reduced).
Levy fees may be waived; however, it is a one-time courtesy.
If you have proof of address change, name change, etc . that prevented you from receiving information on the tax liability you may be eligible for forgiveness.
Act quickly! Do not allow the situation to linger. The faster you work to resolve the issue the more leverage you have.
Finally, keep scanned or hard copies of all communication, documents filed, etc. as the IRS is notorious for ‘losing’ documentation.
IRS also accepts payment plans in the event that the amount owed supersedes your refund.
Here's the deal...your tax refund is yours and yours alone! How you choose to FLEX is up to you! The biggest FLEX is staying ready so you don't ever have to worry about getting ready!
Let me know if this information resonates with you or someone that you know. Catch the next installment of Finance FriYAY! I'll get into IRA contributions, retirement plans as well as other savings vehicles! If you haven't done so already hit the subscribe button so that you can stay in the loop!
Here are a few links for you to check on your status: