Can Tax Debt Result In Foreclosure?
When there is no effort in settling back taxes from the taxpayers side, the IRS has the right to seize their assets to recover the money owed to the. They can impose wage garnishment, put a hold on bank accounts (bank levy) and even place a tax lien on taxpayer’s properties, which can result in losing their homes. Although losing a home for small amount of taxes debt owed seems to be rare and unlikely, unfortunately it has been a reality in many taxpayers life. As it was published in July of 2012 by “NEW YORK (CNN Money): People are losing their homes over unpaid tax bills that in some cases, add up to just a few hundred dollars.” This was reported when a New York resident lost his home for $400 unpaid taxes. These events are due to outdated state laws that allow local governments to sell tax liens on delinquent properties to investors in order to more quickly collect on overdue property taxes is sparking a second "foreclosure crisis," according to a report from the National Consumer Law Center.
Delinquent taxes aren't a problem to be ignored in the hope that they'll go away. Of course these are hard economic times, the IRS understand that and has made it possible to assist taxpayers who make the effort to resolve and settle back taxes. The problem is that the tax codes can be complicated; it can be hard to find the best tax resolution, especially when these laws change constantly.
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