Tax Bill & IRS FAQ

Questions:

• I am faced with a tax bill that I can't pay. Am I completely at the IRS's mercy, or do I have some options?
• I made a mistake on my tax return and am now being billed for the taxes, plus interest and penalties. Do I have to pay it all?
• Can the IRS take my house if I owe back taxes?
• Can the IRS charge me interest if I was incorrectly sent a refund and the IRS now wants it back?
• How legitimate are the seminars and books by "tax experts" claiming you don't have to pay income taxes?

Answer:

Can the IRS take my house if I owe back taxes?

Yes, but the Taxpayer's Bill of Rights discourages the IRS from seizing primary residences. Also, the IRS doesn't like the negative publicity generated when it takes a home. Furthermore, IRS collectors cannot decide on their own to seize your home. The IRS must first get a court order, which you can contest.

Nevertheless, if the IRS collection division has tried -- and failed -- to get any cooperation from you (for example, if you have not answered correspondence or returned phone calls, lied about your income, or hidden your assets), the IRS may go after your residence as a last resort.