{"id":353975,"date":"2022-08-19T07:44:43","date_gmt":"2022-08-19T12:44:43","guid":{"rendered":"https:\/\/ability-fl-prod.internetbrands.com\/ability-law\/tax\/federal-taxes\/what-are-back-taxes.html"},"modified":"2026-02-10T09:30:02","modified_gmt":"2026-02-10T14:30:02","slug":"what-are-back-taxes","status":"publish","type":"page","link":"https:\/\/www.findlaw.com\/tax\/federal-taxes\/what-are-back-taxes.html","title":{"rendered":"How To Resolve Your IRS Back Taxes"},"content":{"rendered":"\n
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How To Resolve Your IRS Back Taxes<\/h1>\n\n
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\n By Susan Buckner, J.D.<\/a> | Legally reviewed by Catherine Hodder, Esq.<\/a>\n | Last updated\n
\n \n <\/i>\n Legally Reviewed\n <\/summary>\n\n
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This article has been written and reviewed for legal accuracy, clarity, and style by FindLaw\u2019s team of legal writers and attorneys<\/a> and in accordance with our editorial standards<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n\n

\n \n <\/i>\n Fact-Checked\n <\/summary>\n\n
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The last updated date refers to the last time this article was reviewed by FindLaw or one of our contributing authors<\/a>. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please contact an attorney in your area<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n<\/section>\n\n\n

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Key Takeaways<\/h2>\n

Back taxes<\/span>, also known as unpaid federal income taxes, include the original amount owed plus accrued interest, late-payment penalties<\/span>, and other fees. Taxpayers<\/span> can resolve back taxes<\/span> with installment agreements<\/span>, an offer in compromise<\/span> (OIC<\/span>), or penalty abatement to avoid tax liens or wage garnishment<\/span>.<\/p>\n\n <\/div>\n <\/div>\n<\/div>\n\n\n

If you owe back taxes<\/span> to the Internal Revenue Service<\/span> (IRS<\/span>), you\u2019ve already run through the horror stories in your head. These can include penalties, wage garnishment<\/span>, and even the threat of jail time. Unless you\u2019re a career tax evader, the IRS<\/span> will be satisfied if you get up to date on paying your taxes. There are ways to admit your tax debt<\/span>, agree to pay the balance due<\/span>, and even avoid paying the full amount<\/span> of penalties and interest owed.<\/p>\n

Ignoring the issue will make things worse, as the IRS<\/span> will continue to assess interest and late payment penalties<\/span> each year you fail to pay on time. The sooner you reach an agreement with the IRS<\/span>, the more likely you are to reach a resolution you can afford and be able to pay off your back taxes<\/span>.<\/p>\n

Time, Liens, and Levies<\/strong><\/h2>\n

The IRS<\/span> has a 10-year statute of limitations<\/a> to collect your unpaid taxes. That 10-year period starts running from the time they processed your federal tax<\/span> assessment. The IRS<\/span> can do a tax assessment within three years of when they receive your tax return or when it is due. In other words, if you hoped that it was too late for them to collect your taxes, it probably isn\u2019t. If you last filed taxes in 2024, the IRS<\/span> can try to collect taxes until 2034.<\/p>\n

The IRS<\/span> has many ways to collect your taxes until then. The most common step is simply applying next year\u2019s tax refund<\/span> payment to last year\u2019s overdue taxes. You\u2019ll receive a notice explaining that you did not receive an expected refund because the IRS<\/span> used it to offset your back taxes<\/span>.<\/p>\n

If you owe more, the IRS<\/span> takes other steps:<\/p>\n

Short-Term<\/span> Solutions<\/strong><\/h3>\n

The IRS<\/span> can label your account \u201ccurrently not collectible<\/span>.\u201d This means they will not resume collections until your financial status improves. The IRS<\/span> can make this decision while it reviews your installment agreement<\/span> request<\/span>.<\/p>\n

Tax Liens<\/strong><\/h3>\n

A\u00a0federal tax<\/span> lien<\/a>\u00a0is a legal claim against your property or assets. The claim can include real estate, personal property, and future property or judgments. Failure to pay the tax owed after you receive your first tax bill<\/span> automatically creates a tax lien. You will receive a notice of federal tax<\/span> lien once the IRS<\/span> files it.<\/p>\n

Tax Levies<\/strong><\/h3>\n

A tax levy<\/a> is the execution of a tax lien. The government has a claim on your property, which it seizes to pay off your tax debt<\/span>. The IRS<\/span> can seize a wide range of property using a levy, including:<\/p>\n