A self-employed government contractor found herself owing a significant balance due after the IRS disallowed certain expenses she had claimed on her return. The taxpayer’s preparer filed an amended return consistent with the exam adjustments. The taxpayer also requested that the IRS place a collection hold on the account because she could not make any payment at this time. She provided the IRS with financial information which supported her claim that she could not pay.
The IRS agreed that the taxpayer could not presently pay but insisted on filing a lien as a condition of the collection hold. TAS negotiated with the IRS and was able to stop the Compliance area from filing the lien (just two days before it was scheduled to be mailed to the county courthouse), thus avoiding irreparable harm to the taxpayer.
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