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When IRS Back Taxes are an Issue Your Business Can Still Obtain Financing by Chris Curtin
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When IRS Back Taxes are an Issue Your Business Can Still Obtain Financing by CHRIS CURTIN
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| Article Posted: 07/18/2013 |
| Article Views: 315 |
| Articles Written: 4 - MORE ARTICLES FROM THIS AUTHOR |
| Word Count: 435 |
| Article Votes: 0 |
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When IRS Back Taxes are an Issue Your Business Can Still Obtain Financing |
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Finance & Investment,Tax
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If you have unresolved back-tax issues with the IRS, it may be very difficult to obtain the funding you need for working capital and to grow your business – unless you’re working with a funding source that can help you resolve your tax issues and then provide the necessary financing. If you owe the government money, and you have not made arrangements with the IRS to make payment on that obligation, the IRS has the authority to issue a lien against your assets, including those that you have used as collateral for loans. This includes potential liens and levies against your accounts receivable – which you may want to factor to obtain needed funding. Sometimes the Service does not even issue a lien, and will go straight to the “intent to levy stage” – where they can take possession of your assets if you do not make payment or appeal the intent-to-levy notice within 30 days. Furthermore, the IRS often makes a “wrongful levy” – e.g., when a lender already has a prior secured interest or lien on the accounts receivable or other financial or physical assets. The IRS doesn’t conduct a lien search prior to issuing a levy, and thus does not know whether the assets on which it intends to levy are being used as collateral. Even if the levy is wrongful, and the Service had no legal right to those assets, it can be very difficult, time-consuming and costly for you to get the assets back from the government. . If you are experiencing any of these back-tax-related problems, many financing firms will not even consider factoring your accounts receivable, leaving you with a shortage of necessary working capital. And even if your attorney or CPA firm are working on negotiations with the IRS to settle your tax obligation, you won’t be able to factor those receivables unless a payment deal is in place AND arrangements have been made for the IRS to subordinate or have an agreement in place with your funding source.. . An experienced factoring company has access to up-to-date information on IRS liens, levies, tax compliance history, business name discrepancies, accrued tax liabilities, and IRS installment agreements – every relevant piece of information the factor needs to ensure that there is no risk of your receivables being taken by the IRS to fulfill back-tax obligations. If you do have back-tax issues and cannot meet the obligation immediately, a good factoring company also has the resources to help you negotiate a payment agreement and avoid the liens and levies that can obstruct your ability to factor your receivables.
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paragon financial, paragon, tax, irs, business,
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