What is a tax Debt?
Debt associated with the failure to pay taxes to the federal or state government on earned income. Unpaid tax debt can cause stiff penalties and even jail time in the United States. The government also has the ability to garnish wages and place levies on the property for unpaid tax debt.
Sometimes SARS will allow the debtor to set up a payment plan until the amount has been paid in full.
Lawsuits are filed to collect these debts:
In the case of outstanding tax debts, the creditor may have the right to file a lawsuit against the consumer to force payment of the debt through a judgment.
The lawsuit must be served upon the debtor according to the service of process rules of the state in which the consumer resides. Then, the consumer can defend the lawsuit by asserting various defences such as fraud in the creation of the account, or that the amount sought after is incorrect or has been paid, to name just a few.
If the case is not properly defended, then the creditor will obtain a judgment in its favour. When the creditor has a judgment, it may seek involuntary means to force payment such as wage garnishment, asset attachment or lien on the property.
How debt review can help those with a tax debts
Using a Debt counsellors like ezDebt we will formally review your finances and develop a suitable monthly budget by negotiating with your creditors on your behalf
- Enables clients to make one monthly debt repayment
- Stops creditors from hassling you
- Decreases judgements against you
- Prevents you from declaring bankruptcy
- Maps out the path towards becoming debt free
If you’ve fallen behind with your rent payments, you should take action quickly to deal with the situation.