The short answer here is, yes.
Even on the best terms, no one wants to deal with the IRS. When your business’s tax burden is more than you can pay, dealing with the IRS can seem to go from headache to nightmare. Understanding the options and what the IRS can and cannot do can be confusing.
If your business is behind on taxes, the IRS can take your business. This option, however, is not ideal. For either of you. Here’s what you need to know about what the IRS can do if your business has past-due taxes.
The IRS wants your money not your business
On the one hand, yes, the IRS wants to collect any outstanding tax debt. They’re even willing to go to extreme measures if they must. But this is not the idea situation.
Taking your business takes away your ability to earn a living and pay future taxes. From the standpoint of the IRS, you are far more valuable with your business and livelihood intact.
Also, the process of collecting your business and selling any assets that come along with it is, often, more trouble than it is worth. While it is a measure the IRS is willing to take, it is not how they would prefer to handle it.
If I can’t pay, then what?
There are alternatives for paying your tax debt before the IRS starts taking real steps toward taking your business. Alternatives can include options such as creating a payment plan, negotiating an alternative amount or an Offer in Compromise. Staying in communication with the IRS through qualified legal counsel is the best way to make sure that you have all the possible alternatives available to you.
It’s important to note that even if the IRS is planning to take your business, there are a lot of steps they have to go through to get that done. This means that there are a lot of opportunities to come up with an alternative before the IRS takes your business. A tax law professional can carefully examine your situation and provide the legal guidance you need to successfully navigate your IRS tax matter.