Navigating IRS collection forms

Internal Revenue Service (IRS) collection forms can be complex and require disclosure of a multitude of information. If you are currently in collections and looking for guidance navigating IRS collection forms, consider contacting a knowledgeable tax lawyer with Damiens Law. A tax lawyer can review your situation, determine the tax forms you will need to complete, and evaluate various options available to you to resolve your tax debt. You can set up a confidential consultation by calling (601) 957-9672.

Difficulty navigating IRS collection forms

Many taxpayers have difficulty navigating IRS collection forms. There are complex forms and schedules. While the IRS provides instructions, these are often very long and difficult to understand. Different forms are required under different situations, which can make the process even more confusing.

Damiens Law understands that not everyone is equipped to navigate these complications alone. IRS guidelines can be complicated. Rather than simply agreeing to pay the entire tax debt or use a high-interest credit card or loan to pay off the debt, you may be able to use tax forms to minimize debt. A tax lawyer can help you navigate IRS collection forms, which may help you save money on interest and penalties and explore other options to minimize tax debt.

Common IRS collection forms

The first thing to help with navigating these forms is to understand which forms may be used. Different forms may be required, based on your particular situation. However, the most commonly requested forms include:

Form 9465

Form 9465 allows taxpayers to request consideration to enter into a monthly installment agreement to pay off past-due tax debt. This form is used when a taxpayer cannot pay the full amount they owe on their tax return. With this form, the taxpayer proposes a monthly payment that they will make until the debt is resolved. Generally, the taxpayer must propose an amount that will pay off the past-due tax within 72 months. For example, if they owed $7,200, they would need to offer to pay at least $100 per month.

Taxpayers cannot use this form if they are already making payments on a current installment agreement. Instead, they would need to contact the IRS and see about modifying their existing agreement.

Form 433-F

Form 433-F is a form the IRS uses to collect financial information from a taxpayer who owes taxes. The IRS uses the form to assess eligibility for payment plans and uncollectible status. This form is sometimes required when taxpayers over $100,000 as an individual or $25,000 for a business. If the taxpayer does not want to set up a direct debit for the payment plan and owes more than $50,000, they may also have to complete this form.

The form consists of the following parts:

Personal information

The top section of Form 433-F asks the taxpayer to provide basic personal information, including their:

• Name
• Address
• Contact information
• Social Security Number
• Spouse’s information

Business owners completing the form must provide the legal name of the business, employer identification number, and number of employees.

Section A

Section A asks the taxpayer to provide information about various accounts, including:

• Bank accounts
• Lines of credit
• Retirement accounts, including IRA and 401(k) accounts
• Mutual funds
• Profit-sharing plans
• Stocks and bonds

Section B

In section B, taxpayers must list and describe all real property they own and are planning on purchasing. This can include:

• Their primary residence
• Vacation homes
• Timeshares
• Rental or investment properties

Taxpayers must state when they purchased the property and for how much. They must also provide information about the property’s current value, the property’s equity, and how much they still owe on the property. To calculate equity, taxpayers subtract the amount they owe from the current value of the property.

Section C

Taxpayers must list similar information about other assets they own, including the purchase date, price, current value, and any debt attached to the asset. Other personal or business assets might include:

• Vehicles, including cars, boats, recreation vehicles, or mobile homes
• Artwork, paintings, coin collections, antiques, or other items of value
• Tools, equipment, and inventory
• Intangible assets such as domain names and patents

Section D

Section D asks taxpayers about their current credit card debt. The taxpayer must list all credit cards they have, whether or not they have a balance. They must list the amount they owe on each card.

Section E

Taxpayers only have to complete section E if they own a business. Here, they list information about their accounts receivable, business bank accounts, and business credit cards.

Section F

Taxpayers provide information about their employer, including their name, when they are paid, how much they are paid, and amounts paid in taxes. This section is for employment income while the next section is for non-wage income.

Section G

Taxpayers list information about other income they receive, such as:

• Agricultural subsidies
• Alimony
• Child support
• Distributions from partnerships or S corporations
• Gambling income
• Interest dividends
• IRA payments
• Oil credits
• Pension income
• Rental income
• Self-employment income
• Social Security payments
• Unemployment income

Section H

Taxpayers provide information about their monthly necessary living expenses. It is important that taxpayers take special care in this section to show the IRS their financial limitations. Taxpayers can provide information about how much they pay each month for:

• Rent
• Utilities
• Childcare costs
• Transportation
• Food
• Clothing
• Insurance premiums
• Student loan payments
• Medical expenses not paid for by health insurance
• Personal care
• Court-ordered payments like child support or alimony
• Delinquent state tax payments
• Estimated tax payments
• Other expenses

Submission instructions

The taxpayer must sign Form 433-F and send it to the IRS. If they are applying for a payment plan, they will also include Form 9465. The taxpayer sends the form and accompanying documents to the address supplied by the IRS based on their location.

The IRS may request additional information, but the taxpayer does not have to supply this information at the time they send in Form 433-F.

Form 433-A

Form 433-A collects financial information from wage earners and self-employed individuals to determine their ability to repay a current tax liability. This form is broken down into the following sections:

Section 1

Section 1 begins by asking for personal information to identify the taxpayer. The taxpayer must include their:

• Name
• Address
• Phone number
• Date of birth
• Marital status
• Social Security Number

Section 2

Employment information is input into Section 2 of the form. This section includes:

• Taxpayer’s employment status
• Pay period dates
• Occupation
• Withholding allowances from Form W-4

Section 3

The taxpayer discloses other financial information in this section, including:

• If they are a party to a lawsuit
• If they have filed bankruptcy
• Whether they have lived outside the country for more than six months during the last ten years
• If they own a safe deposit box
• If they are a beneficiary of a trust, estate, or life insurance policy
• Whether they have transferred any assets for less than fair market value

Section 4

The taxpayer discloses personal asset information in this section, including the identity and value of any assets they own, such as:

• Bank accounts
• Investments
• Lines of credit
• Real property
• Motor vehicles
• Other personal assets

Section 5

The taxpayer includes information about their monthly income in section 5 and provides details:

• Wages
• Salaries
• Pensions
• Social Security income
• Business income
• Rental income
• Unemployment compensation
• Gambling income
• Oil credits
• Subsidies

The taxpayer also provides information about monthly expenses, such as:

• Food
• Clothing
• Rent or mortgage
• Utilities
• Vehicle ownership and operating costs
• Public transportation
• Health insurance
• Healthcare expenses not paid for by insurance
• Court-ordered payments, such as child support or alimony
• Childcare costs
• Medical and insurance premiums
• Income withholdings
• Secured debt payments
• Delinquent state or local taxes

Section 6

Only self-employed taxpayers have to complete section 6, which discusses information about their type of business, business assets, and payment processing tools.

Section 7

Section 7 asks self-employed taxpayers about their current accounting method, business income, and business expenses.

Taxpayers are asked to provide documentation that substantiates the information on this form.

There may be other forms that you are requested to complete, based on your particular tax situation.

Contact Damiens Law for help with IRS collection forms

Completing IRS collection forms is no easy feat. However, providing accurate information may be able to help taxpayers keep their assets and resolve liabilities with the IRS. By taking the time to carefully complete these forms and gather relevant financial information, taxpayers will have a better understanding of their financial situation and their ability to pay off tax liability. They will also be better positioned to provide this information to the IRS. However, taxpayers do not have to go through this process alone.

A knowledgeable tax lawyer from Damiens Law can help you fill out these forms and prepare them in an organized fashion. This will also show the tax examiner that you are serious about resolving your tax debt and making a good faith effort to pay what you can. For help with your submission, consider contacting our firm by calling (601) 957-9672.