I owe taxes and the IRS has contacted me; what do I do?

Assuming that the balance owing is accurate (often they are not) you need to face the fact that you will likely have a tax payment as part of your current family budget. Pull IRS Form 433-A from the IRS web site (irs.gov) and fill in the financial information so that you can get a picture of your financial position and ability to make a monthly tax payment.

You can look at a number of options to pay. Terms of payment may extend for as long as 84 months for the IRS and states vary, but typical payment periods are 12-18 months.

Stay in contact with the IRS or state through the duration of your payment plan. Occasionally I get a call where a state or IRS has come in and taken cash or property or set-up a garnishment on the person’s wages. The IRS has no interest in taking your stuff. In fact, the IRS will only start to take stuff when all other methods of payment have failed and there has been a break down in the relationship between the taxpayer and the IRS representative. One other matter-owing taxes is not a crime. You are not going to jail.