State Tax Debt

In addition to assisting taxpayers with IRS tax debt, Tax Matters Solutions also offers tax help for taxpayers who owe money to their state. Every state has it’s own taxing agencies and tax collection agencies. The collection policies and procedures vary widely from state to state. However many states have implemented similar procedures as the IRS to help taxpayers resolve their past due tax debts.

It is not uncommon for businesses to owe back federal taxes such as income, payroll, or excise tax. The same circumstances which lend the company to become delinquent of federal taxes also lend it to become delinquent in state taxes. Business owners which are delinquent in filing or remitting state withholding, sales, and other various taxes usually have federal tax problems as well. It is imperative that when working out a plan to resolve your tax problems that the plan should deal with all taxing authorities. Anything short of that could leave you in a compromised situation down the road. Let me explain it this way. If you work out a payment plan with the IRS and then the state levies your bank account you will not have the ability to fulfill your agreement. This works the other way as well. It is also important to understand the different statute of collections for each agency involved. For example if your state does not recognize a statue of collections it has no time limitation to collect. The IRS statue of collections generally is ten years. Therefore generally it would be in your interest to insure the state is paid before the IRS.