Notice of Collection—All You Need to Know
Owing money may feel like a burden on your shoulders, no doubt. It’s a persistent anxiety that reminds you of your financial commitments yet to be settled.
And while that may seem like enough worry for you, imagine how uneasy you will feel when the tax authorities come knocking and serve you with a Notice of Collection. Suddenly, the weight of uncertainty increases and you can’t help but wonder why that scary notice is in your mailbox, and exactly how on earth can you handle it.
At Cumberland Law Group, we get it—understanding the ever-complex tax matters can prove overwhelming, to say the least. But it doesn’t always have to be that way and that’s why we’re going to offer some clarity on this matter and offer you the guidance you need. So, read on!
What Is a Notice of Collection?
A Notice of Collection is an official notification from tax authorities to a taxpayer informing them that their total liability—including the amount of tax owed, accompanying penalties, and accrued interest—is final and recoverable. The notification often follows a previous assessment in which the taxpayer failed to pay the full amount required.
Why Did You Get This Notice?
Looking back, the Department of Revenue issued a previous assessment, which provided a financial snapshot of your obligations. If this assessment was not paid in full, the Notice of Collection was then sent as a follow-up, more like an urgent reminder of your unpaid dues. The key to understanding the composition of your overall obligation is found in the Explanation section of your earlier evaluation.
Failure to settle the whole sum results in a series of repercussions. And at this point, this is more than simply overdue taxes; it’s a chain reaction that includes penalties and interest.
What Should You Do?
When facing a Notice of Collection, you must understand that time is of the utmost essence. Therefore, an immediate response is not a suggestion but a necessary step in steering your financial ship away from rough waters. Better put, quick action is your ally as procrastination could just make the whole situation worse. You don’t want that.
So, what should you do about it?
- Paying the Balance Due: This is the simplest way to resolve the tax issue at hand. Just gather the funds, remit them on time, and watch the dark clouds disappear and the storm subside.
- Entering an Official Installment Payment Agreement On the Outstanding Balance: While clearing the balance due is the swiftest remedy to owing taxes, collection authorities understand that it’s not that easy. For that reason, they offer a lifeline in the form of an installment payment agreement, which is a structured plan designed to help you make your payments over time, easing your immediate financial burden. Not bad, right?
- Contacting the Department of Revenue for Alternatives: Financial situations vary, and even Georgia’s revenue department understands that. As such, if immediate payment or an installment plan is not feasible, be sure to reach out to the department at (404) 417-6605 or your local service center to discuss other alternatives better tailored to your specific situation.
It’s crucial to keep in mind that understanding your financial options is the first step towards resolving the Notice of Collection. Figure out the course that best suits your needs and consider seeking professional Atlanta tax attorneys like Cumberland Law Group for a personalized road map through such fiscal issues.
Frequently Asked Questions
Here are some common questions asked about Notice of Collection.
What If I Ignore This Notice?
Ignoring the Notice of Collection is the same as letting a storm rage towards you without seeking shelter. When faced with no other options, the revenue department launches forceful collection procedures. These may include taking a part of your wages, freezing bank accounts, issuing tax liens, and even seizing assets. That would be a powerful storm coming at you. Even so, you can avoid all that through quick and smart action.
Moreover, neglecting the notice has consequences beyond the mentioned forced actions. There is also a financial cost: a 20% collection assistance fee. This additional charge adds to the current debt, making the resolution even more difficult.
What if I Already Set Up an Installment Payment Agreement?
Even if you have an active Installment Payment Agreement, the law requires that the department send you a Notice of Collection. So, look at it as a procedural obligation and not a sign of failure on your side.
The silver lining? Sticking to your installment plan protects you against forced collection procedures. In other words, the department will not take harsh action if you stick to the terms of the agreement, giving you a break amidst the storm.
What if I Already Paid the Total Liability?
Despite paying the amount owed, receiving a Notice of Collection may cause concern. It could be due to:
- a technical issue, such as the payment not reflecting in your taxpayer’s department account
- an outstanding liability for a previous period
- due penalties, fees, and interest
Whichever the case, you can contact the Department of Revenue for more information and clarification.
Your Go-To Tax Experts in Atlanta, Georgia
As we’ve seen, the Notice of Collection is nothing but a compass pointing you to financial clarity and not really a “death sentence” as it may seem at first.
We can only urge you to embrace the guidance offered, consider your options, and if necessary, take refuge in the experience of our Atlanta tax experts at Cumberland Law Group. Whenever you’re ready, contact us and let us help you reach the shores of financial tranquility.