By Chad Silver of Silver Tax Group posted in Back Taxes.
North Dakota, not known for much except the gleeful oil boom of the past few years, has looked rather economically viable and sustainable for the past few years up until very recently.
With unprecedented growth, oil companies were in dire need to hire people to work the oil rigs. And those rig jobs were lucrative. Sure, the hours were long and job dangerous, but the pay promised riches for these otherwise underemployed.
The Problem With Jobs During the Oil Boom
Many of these new workers would sign up as independent contractors, meaning that while they worked for the company, the workers were also responsible for covering their own costs of doing business. These costs not only included your typical costs of transportation, living,
And here’s the thing, a lot of people found themselves unable to pay their part to the IRS.
What does this mean today?
So, fast forward to the present. Oil prices drop and suddenly costs of pumping oil out of the ground outweigh what a barrel fetches on the market. Crude oil rigs can no longer afford to operate, and all of these workers are suddenly let go.
For many independent contractors, planning for such a catastrophe was not entirely feasible, and the proper savings, for both living and taxes, are just not in the bank accounts.
And even though it may take a few years, at some point the Federal Government is going to catch up to these oil working independent contractors and look to collect on the back taxes owed to the IRS.
What are the Consequences?
When the Federal Government is looking to collect, they mean business. Sure, the letters are at first cordial, and ideally, that’s when people who owe back taxes should take action. But more often than not, these letters are ignored, and the messaging gets more aggressive.
Soon, people are getting notices that are downright intimidating, including personal visits from IRS agents, freezing of bank accounts and weekly wage garnishments.
At this point, Uncle Sam is forcibly taking what is owed and ensuring that these oil workers are intimidated enough to stay out his way. People that find themselves in this situation find that stress becomes a large part of their life.
Sleepless nights, frequent arguments with family over money and constant anxiety start to consume what would otherwise be an ordinary day.
This is the point where consulting with a professional Tax Attorney is key to surviving this nightmare.
How To Resolve Your Tax Collection Debt
Tax Lawyers have a considerable amount of power in first putting a hold on these garnishments and scare tactics. On your behalf, a Tax Attorney will get the IRS on the phone and let the Fed know that these collections need to be put on hold.
From there, a tax attorney will be able to figure out whether or not a person is able to pay or not. If unable to pay, a Currently Not Collectible (CNC) status may be the best option, allowing people the opportunity to get back on their feet financially.
For those that are able to pay, a Streamlined Installment Agreement may be the best option to fit monthly payments into the budget of any household. A payment plan can help you manage your tax payment without a credit card.
For those oil workers, or anyone else for that matter, that find themselves in a similar position of being threatened and intimidated by the IRS, there are options available beyond ruthless collection tactics.
Time is often a huge factor, so finding the right tax attorney is key. But once a lawyer is secured, a resolution can be structured, and life can continue on.