Receiving a letter from the Internal Revenue Service (IRS) can often startle many people, even if they faithfully fulfill their tax obligations. One such letter that can cause concern is the Final Notice of Intent to Levy and Your Right to a Hearing, also recognized as Letter 1058 or LT11. This letter signifies the IRS’s intent to seize assets due to unpaid taxes. Understandably, the very sound of it can stir anxiety. However, with the appropriate knowledge on handling such a situation, coupled with immediate action, this daunting circumstance can be dealt with effectively.
What Exactly Is Letter 1058 or LT11?
The IRS issues Letter 1058 or LT11 to taxpayers who have unpaid tax liabilities. It signifies the IRS’s intent to levy, meaning that they can legally seize your assets to fulfill the unpaid tax debt. The assets can include your wages, bank account, social security benefits, and property.
Why Do You Receive Letter 1058?
Generally, taxpayers receive this letter when they have unfulfilled tax debts that were not adequately addressed during prior notices. The IRS sends this as the ‘final notice’ prior to action, offering you an opportunity to resolve the tax issue.
What To Do Upon Receiving Letter 1058?
If you receive this letter, the first essential step is not to panic. Nonetheless, you should take this notice seriously and take swift action to resolve the issue. Ignoring the issue could lead to serious consequences, such as forcing the IRS to take levy action.
Exercise your Right to a Hearing
Upon receiving Letter 1058, you have 30 days to request a Collection Due Process (CDP) hearing. During this hearing, you can challenge the levy action and propose alternative methods to resolve your tax liabilities, such as installment plans or an Offer in Compromise.
- Pay your Tax Debt
- Set up a Payment Plan
- Submit an Offer in Compromise
- Seek Professional Tax Assistance
If you have the means to pay the unpaid taxes, it is advised to do so in full to stop further IRS action.
If you cannot pay the full amount, consider setting up a payment plan with the IRS. This installment agreement allows you to pay your debt over time.
Another option is submitting an Offer in Compromise, which is an agreement between you and the IRS to settle your tax liabilities for less than the full amount you owe.
Dealing with tax issues can be complex, so it’s typically beneficial to seek help from tax professionals. They can assist you with understanding your options and choosing the most suitable course of action.
Frequently Asked Questions
What should I do if I cannot pay the entire tax liability?
If you cannot pay the full amount of your tax liability, there are options. You could apply for an installment agreement, file for an offer in compromise, or consult with a tax professional to explore other potential options.
What happens if I ignore Letter 1058?
Ignoring Letter 1058 can lead to severe consequences, including the IRS initiating a levy action, where they can legally seize your assets to settle the tax debt.
Finally, the key to dealing with Letter 1058 is swift action. Through understanding, careful consideration of options, and timely action, anyone can effectively handle receiving this form of communication from the IRS.
