Moving won’t wipe out federal tax obligations
Most Americans with tax debt believe that relocating to another state will relieve them of their financial burden. But Clear Start Tax experts indicate that shifting your address will not wipe out your IRS obligations.
Even though each state taxes itself, your federal taxes will be the same whether you move anywhere in the country or even outside the United States. The Internal Revenue Service (IRS) can collect from you anywhere in the country— even if you move across the country or overseas.
A Clear Start Tax spokesperson stated, “Relocating does not grant you a do-over with the IRS.” “Debt from taxes follows you. The agency is able to take collection activity wherever you live.”
That is, relocating can give you a new zip code — but not a do-over for delinquent taxes.
How can the IRS still collect?
Even if you move away, the IRS has various options to collect unpaid taxes. The agency can:
- Garnish your wages — taking money straight out of your paycheck.
- Levy your bank accounts — taking money to satisfy your debt.
- Place federal liens on your property — so the government can hold legal title to your property.
Since these actions extend across the country, crossing state lines doesn’t shield you from enforcement by the IRS. The agency can follow you to your new location through employer information, bank accounts, or even credit reports.
Moving could give the IRS more time
What the majority of taxpayers are unaware of is that moving can extend the collection time for the IRS. The IRS also has a Collection Statute Expiration Date (CSED)—usually 10 years—that places a time limit on how long they can pursue debt.
Yet, some activities can suspend or “toll” that clock, i.e., the IRS has more time to collect. Emigration abroad or moving to a different state with varied administrative practices could serve as a prime example.
A spokesperson for Clear Start Tax stated that attempting to outpace the IRS is a costly misconception. It actually gives the government more time to collect. Taxpayers who leave without paying their debt typically have more profound problems later on.”
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What can taxpayers do instead?
Instead of leaving in an attempt to skip tax debt, experts advise tackling the issue head-on. Before moving, taxpayers should:
- Check their CSED — to determine how long the IRS can collect.
- Consult a tax pro — to discuss payment or relief options.
- Check if they qualify for the IRS Fresh Start Program — which helps people pay or settle what they owe.
The Fresh Start Program is designed to allow taxpayers to pay off debts or set up affordable installment agreements. It may also help some people have liens removed or erase penalties.
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By taking action early, taxpayers can avoid costly collection action such as garnishment of wages or seizure of property.
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About the clear start tax
Clear Start Tax is a national tax resolution firm that helps individuals and businesses resolve their IRS and state tax issues. The firm utilises experienced tax professionals who consult closely with clients to create strategic solutions for:
- Back taxes
- Liens and levies
- Tax relief programs
- Clear Start Tax has helped thousands of taxpayers regain financial stability and peace of mind by resolving their tax issues.
