Don’t Ignore the IRS: It Could Cost You More Than You Think

If you’re receiving letters from the IRS, think again before tossing them aside. 

Ignoring communication with the IRS can lead to serious financial consequences, including wage garnishments, interest, asset seizures, not just mounting penalties.

This article explains what happens when you ignore an IRS notice and how to respond to avoid further consequences.

Why are you getting letters from the IRS?

The IRS sends millions of notices to taxpayers, many requiring immediate action.

Common IRS Notices:

• CP14: Balance due
• CP501/503: Past due tax balance
• CP2000: Unreported income
• LT11: Final notice before levy
  Letter 1058: Intent to Levy
  
  

Pro tip: These notices usually give the taxpayer 30 days to respond. Missing the deadline can make your situation more complex.

What are the Consequences of Ignoring IRS Letters?

Ignoring IRS notices is serious business. The IRS will continue to collect the debt owed and will take the following actions against ignored notices. Here's what your risk is by ignoring the notice from the IRS:

1. Penalty and Interest Accumulation

Penalties for failure to file and failure to pay result in daily interest (up to 25% of the amount owed).

2. Wage Garnishment

Your employer is contacted by the IRS and instructed to deduct a portion of your paycheck.

3. Bank Levies and Asset Seizures

The IRS can seize assets like your home, car, and business property or freeze your bank accounts.

4. Tax Liens

Your credit report can show a tax lien, which damages your financial reputation and limits your borrowing power.

5. Passport Restrictions

Tax debt over $59,000 may also result in passport revocation or denial.

IRS Enforcement Is Set to Speed Up in 2025

With the IRS aiming to shrink backlogs and implement more AI technology, non-compliant taxpayers have a higher risk of collections and audits. So don’t take the risk and ignore an IRS notice.

How Do You Respond to an IRS Notice?

1. Read the notice – Understand what’s being stated and what is being asked of you.
   
   
2. Check the deadline – Mark your calendar with the 30-day deadline.
   
   
3. Gather documentation – Collect income, deductions, or dependents documentation.
   
   
4. Respond in writing or online – Follow the exact steps specified on the notice.
   
   
5. Consult a tax professional – Still confused? Contact a pro, especially if you can’t pay or need help negotiating.
   
   

When Do I Need a Tax Pro?

If you're overwhelmed, unsure of the process, or dealing with a large tax debt, now’s the time to work with experienced professionals like Tax Attorneys of America. We help taxpayers:

• Avoid or release levies
  
  
• Set up Installment Agreements
  
  
• Qualify for Offer in Compromise
  
  
• Protect their income and assets
  
  

Conclusion: Don't Wait, Act Today

The absolute worst mistake you can make if you have an IRS notice is to ignore it. Every day you delay responding, you run the risk of increased penalties, enforcement, and fewer options for resolution.

Contact Tax Attorneys of America today for a free consultation if you’ve received an IRS letter and don’t know where to start.