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A tax levy is one of the worst repercussions of tax issues your family can have. Therefore, you must do everything possible to avoid getting a tax levy this year. These are some of the tips that will help you to achieve that. Read through them and practice every one to avoid getting your family into this rough situation.
1. File Your Taxes on Time
Many people who have levies placed on their bank accounts suffer because they failed to file their taxes on time. Interest and penalties accrue rapidly when a taxpayer doesn’t file. For that reason, you have to take special measures to ensure that you file your taxes on time each year. You can mark your calendar or set an alarm on a smartphone calendar app if that helps.
2. Request an Extension if Necessary
Life sometimes gets in the way of people filing their taxes on time. It’s understandable if you get backed up because of family obligations, medical crises, job requirements or something else. However, you still need to ensure that you protect yourself. You can do that by requesting an extension of time to file your taxes with the IRS. All you have to do is complete one form with the IRS for an extension. If approved, you’ll have six additional months to file your taxes. Your due date will be October 15 instead of the usual April 15 tax date.
3. Have Someone Else Do Your Taxes
You can also relieve yourself of the burden of taxes by allowing someone else to do them for you. Tax preparers are in business to ensure that your taxes get done quickly and accurately each year. By hiring a tax professional, you will be ensuring that your taxes get done, and you avoid getting a levy because you couldn’t do your own on time. Tax preparation prices are very affordable these days, and some providers even issue discounts and promotions to get new clients each year. You should look into it if you think you’re going to have a problem.
4. Answer All IRS Communications
The IRS will keep in touch with you if it discovers that you owe money. They will normally send a notice to you that states the amount you owe and the reason you owe it. You can avoid getting a tax levy on a bank account by contacting the IRS the moment you receive a notice about owed money. The worst thing you can do to the IRS is ignore their communication. That will cause them to resort to drastic measures such as putting a tax levy on your home, bank account or other property. It’s very difficult to undo a tax levy once it’s in effect. For that reason, you should do everything you can to make good faith efforts to stay in touch with the Internal Revenue Service.
5. Use Tax Software
You can still do your taxes yourself if you don’t want to hire someone else to do them. You can use sophisticated tax software to do them instead of doing them on a paper form and dealing with the calculations. Tax software is programmed to help taxpayers maximize their refunds. It does all the calculations so that the taxpayers don’t have to. You may want to try it if you have a hard time completing your tax forms. You’ll be glad you put the effort into it. Your tax return will be filed on time, and it will be accurate.
6. Make Payment Arrangements
The IRS is not likely to put a levy on your property if you’re trying to take care of your obligation to them. You can apply for an installment agreement if you owe them money, and they will work out a plan for you. You need to have a debit card on hand when you make your request. They’ll likely approve your installment agreement and allow you to pay your bill each month. Make sure you make all of your payments, and you should be just fine.
Keep Your Taxes Positive This Year
Now you know how to avoid a tax levy. Keep practicing good measures, and you’ll never have to worry about receiving a levy of any kind.