Tax Controversies

The Federal Tax Lien (“FTL”) is not self-executing — meaning that the FTL encumbers the taxpayer’s property but it does not collect the delinquent taxes.  To enforce the collection of delinquent taxes, the Internal Revenue Service (“IRS”) utilizes the Federal Tax Levy (“Levy”), as an administrative collection tool, by which to take custody of the taxpayer’s property, in order to satisfy any…

Whether it be the Indiana Department of Revenue, the County Sheriff, or a privately contracted collection agency that is attempting to collect delinquent Indiana taxes, the power to Levy on the taxpayer’s bank accounts, salary, wages, or other property is available. In general, the County Sheriff shall only have one hundred twenty (120) days, from the date that the Judgment…

The Internal Revenue Service (“IRS”) can seek to collect on the taxpayer’s liability, from the property, of a third (3rd) party, when the third (3rd) party is holding the taxpayer’s property as a nominee. The nominee theory is based on the premise that the taxpayer ultimately retains the benefit, use, or control over property that was allegedly transferred to the…

As soon as practicable after a lawful assessment, the Illinois Department of Revenue (“IL-DOR”) shall issue a Notice and Demand for Payment (“N&DFP”), to the taxpayer, for any unpaid portion, of the assessment.  The N&DFP shall be left at the dwelling or usual place of business, of the taxpayer, or shall be sent by mail, to the taxpayer’s, last known…

Our new Constitution is now established, and has an appearance that promises permanency; but in this world nothing can be said to be certain, except death and taxes. If it is a joint tax liability and the secondary taxpayer is deceased, then pursue tax collection from the primary taxpayer.  If it is a joint tax liability and the primary taxpayer is deceased,…

If the liable taxpayer, after Notice and Demand for Payment, neglects or refuses to pay, then the balance due (tax, penalties, interest, costs) shall be a Lien, in favor of the State of Illinois, and shall attach to all property and rights to property, belonging to the taxpayer, whether real or personal.  Unless another date is specifically fixed by law,…

The Statute of Limitations for Collection, is a time limit, on the Internal Revenue Service (“IRS”), in which to collect delinquent taxes, from the taxpayer, for a particular tax year. In general, the IRS has ten (10) years, after the date of assessment, in which to collect.  This ten (10) year deadline is referred to as the Collection Statute Expiration Date (“CSED”). …

If the taxpayer has delinquent Indiana taxes, then the Indiana Department of Revenue (“IN-DOR”) shall issue a Demand for Payment (“AR-40”).  The taxpayer has twenty (20) days, from the date, of the AR-40, to full pay the delinquent taxes or to show reasonable cause for not paying. If, after the twenty (20) day time period, the taxpayer fails to pay…

A Certificate of Release of Federal Tax Lien (“Release”) is a public notice that indicates that the tax liability is no longer owed.  However, the Release does not remove reference to the filing, of the corresponding Notice of Federal Tax Lien (“NFTL”), from the public record.  Consequently, even though the tax liability has been resolved and the Release has been obtained, a third (3rd) party…

If the Indiana Department of Revenue (“IN-DOR”) reasonably believes that the taxpayer has not reported the proper amount of tax due, then, based on the best information available, it shall make a proposed assessment, of the amount, of the unpaid tax, and issue a Notice of Proposed Assessment (“AR-80”). The taxpayer may challenge the AR-80, by filing a written protest (“Protest”),…