Jan 22, 2008

Armed Forces Personnel- Tax Debt subject to enforcement?

Unfortunately, many of our armed forces personnel have tax debt they owe to the IRS. Fortunately for our armed forces personnel that are serving in a combat zone, their pay is not subject to levy while they are in the combat zone.

How does the IRS know this? You can notify them according to their procedures. Also, in some discussions with the IRS related to armed forces tax levies, the IRS has indicated that they have received a listing of the qualified personnel. It is my experience that this list cannot be relied on for getting the exclusion because it is not efficiently managed.

The best manner to lift an IRS levy during this time is to get evidence of employment with the armed services and proof of deployment to a combat zone. Then, the IRS can be contacted and the levy released.

A combat zone exclusion will also extend the collection statute of limitations. You will need a competent tax professional to weave you through the resolution of your taxes.

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