If you have received IRS Letter 3174, it is important to understand what it means and how to respond. This letter serves as final notice that the IRS intends to levy your bank accounts or garnish wages due to overdue taxes. While it is crucial to act upon receiving this letter, remember not to panic, as you still have options available to you.
Letter 3174 is sent as a courtesy to taxpayers, following a Notice of Intent to Levy. The worst thing you can do when you receive this letter is ignore it and hope the problem goes away — it will not.
When Does the IRS Send Letter 3174?
In most cases, when you receive a Letter 3174 from the IRS, it means you have already received several prior notices about your unpaid taxes. This letter is like a final warning. They have already sent you a Notice of Intent to Levy, which means they are planning to start collections if you do not resolve your delinquency or at least contact the IRS and make payment arrangements to do so.
Letter 3174 is typically your last chance to get things sorted out before the IRS starts taking more serious steps, like seizing your assets or taking money from your paycheck.
Has the IRS Issued a Levy If I Received a 3174 Letter?
Receiving a 3174 letter from the IRS does not automatically mean they have issued a levy against you. With that said, the IRS sometimes sends this letter at the same time as the levy paperwork.
In this case, the 3174 letter acts as a cover letter for the levy. If you do not see any levy paperwork included with the 3174 letter, then the levy probably hasn’t happened yet, but you should contact a tax professional right away, as they can help you determine what your current status is with the IRS.
Is It Too Late to Stop a Levy When I Get IRS Letter 3174?
If you receive IRS Letter 3174 and it is not accompanied by levy paperwork, then the levy probably has not been issued, which means it isn’t too late to stop it. However, time is of the essence. It is critical to start right away to get your tax debt situation sorted out with the IRS. A delay could result in the levy being enforced, causing additional financial hardship.
How Soon After the IRS Sends 3174 Does Collection Enforcement Begin?
There is no minimum or maximum time between when the IRS sends Letter 3174 and when they start to levy your wages or bank accounts. As previously mentioned, the IRS has been known on occasion to issue the levy at the same time they send the letter.
If you did not receive levy paperwork with your letter, just known that the IRS can begin collection enforcement immediately after sending the notice if you do not respond or pay the amount due.
What Do I Do If the IRS Sent Me a 3174 Letter and I Don’t Have Enough Money to Pay Taxes I Owe?
If you receive a 3174 letter from the IRS and cannot afford to pay the taxes you owe, the first thing you should do is not panic. The IRS offers several tax relief programs for taxpayers in your situation.
One popular relief option is an Offer in Compromise, where the IRS agrees to accept less than your total tax debt amount to resolve your back taxes.
Another option is a payment plan, allowing you to make fixed monthly payments based on your income and other financial obligations.
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