Illinois Tax Relief

How Illinois Collects Taxes & Programs for Those Needing Tax Help

The Illinois Department of Revenue is responsible for administering the tax laws of the State and that means collecting taxes. When taxpayers are delinquent in paying their taxes, they are subject to a whole series of collection activities.

If you fail to file your taxes or pay what you owe, you will get a bill from the State that includes accrued interest and penalties. Your initial tax bill will provide a breakdown of taxes and charges owed, an explanation of why you owe this amount along with your legal rights and obligations with regard to the collection process. If you neglect to pay what you owe or if you cannot pay the full amount, the Revenue Department will start the collection process, as follows:

Collection Activities

The Illinois Department of Revenue has a number of enforced collection activities it uses to collect unpaid taxes. If you have unfiled returns and/or owe back taxes you may find a lien placed against your property, have your personal and/or business assets seized, your bank account(s) levied and/or wages garnished.

Depending on the type of business you have, the State can refuse to issue a license or renew your business license. It may also use other collection activities, including private collection agencies. You may also find your name on the Delinquent Taxpayer List, which is posted on the Department’s website.

Tax Liens

When the Revenue Department files a lien against a delinquent taxpayer, it represents the first in a series of aggressive collection activities. If you have gotten behind on your taxes and are at risk of a tax lien you need to know that it will negatively impact your credit rating, make it difficult if not impossible for you to sell or transfer the ownership of any assets, give the State legal grounds to levy your bank account(s) and/or seize and sell your assets.

A lien can be enforced for 20 years. Once your tax debt is paid in full the State will lift the lien. Rather than risk all these consequences, it would be best to hire an experienced tax professional or CPA so that you can get the tax help you need to resolve your tax problems once and for all.

Bank Levies

The Department of Revenue has a legal right to seize the money in your bank account(s), up to what you owe in back taxes. If the State levies your bank account(s) your bank has no choice but to comply with the order. However, there is a waiting period that allows you enough time to get professional tax help so your money can be returned and/or to prevent additional collection activities.

If you are expecting a federal tax refund, it may be at risk if you owe back taxes to the State of Illinois. The State is within its rights to ask the IRS to send your federal tax refund to the Illinois Department of Revenue to offset what you owe in State taxes. If you have had your bank account(s) levied or expect it to be levied, you need to consult with a reputable tax expert or CPA immediately

Private Collection Agencies

The Illinois Department of Revenue does on occasion use private collection agencies to collect delinquent taxes. If a collection agency contacts you about your tax debt, you must be careful about revealing any personal or financial information until you’ve verified their identity and perhaps sought tax help from an experienced professional or CPA on how best to resolve your tax problems.

If the Department turns your account over to a private collection agency you will end up being responsible for the collection agency’s fees as well as your tax debt and the interest and penalties you’ve accrued.

Garnishment of Wages

If your employer receives a garnishment request he/she has no choice but to comply and withhold up to 15% of your gross wages. Your wages can be garnished until the full amount you owe in back taxes is paid. If your paycheck is currently being garnished, or if you are at risk for having your wages garnished, it’s time to contact an experienced tax professional for tax help in resolving the matter.

Personal Liability for Unpaid Business Taxes

Corporate officers or anyone with the “power of the purse” may end up being liable for unpaid business taxes, along with any accrued interest and penalties. Furthermore, corporations in Illinois that are delinquent in paying State taxes may have their corporate charter renewal denied. Every business should have an experienced tax professional offering tax help and advice on a regular basis so that the business is never in jeopardy due to unpaid taxes.