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If the Delaware Division of Revenue attaches your bank account your bank is required to hold and freeze your deposited funds up to the amount of your debt for 20 days. If you have not paid the debt, resolved any problems about the warrant or made arrangements to pay, your bank must then send the money, plus penalty and interest if applicable, to the DE DOR.
Return to topIf the Department of Revenue determines that you cannot currently pay any amount of the tax debt, they may temporarily delay collection until your financial situation improves. If collection is delayed interest and penalties will continue to accrue on your tax bill. A Notice of Judgment will be filed to protect that State's interest in your assets.
Return to topIf you have unpaid taxes you will receive a tax bill from the Delaware Division of Revenue. You should not ignore your tax bill and should voluntarily make arrangements to pay the liability when you receive a bill or notice. If you do not take action to pay your bill the DE DOR may take use of the following enforced collection actions:
If you are unable to pay your tax in full you may be able to arrange to pay your tax debt through installment payments. If you set up a payment plan that is over 24 months, you will be required to have the payment automatically deducted from your financial institution or to have a voluntary wage deduction to avoid a tax lien being filed. The Division of Revenue is required to file a Notice of Judgment on payment plans over 60 months to protect the interest of DE DOR. You will still be charged interest and penalties on the original tax liability along with interest on the unpaid balance of penalties and interest. Any Delaware, Maryland or Federal refunds due to you will also be offset and applied to your balance due.
To avoid enforced collection, you must abide by all terms of the agreement such as paying on time, no missed payments and timely filing and payment of all required tax returns. The Department of Revenue may also request current financial information that affects your ability to pay and change the plan based on your financial situation. You will receive a letter 30 days in advance of any changes that would be made to your plan.
Return to topIf the DE DOR has assessed a tax that is unpaid or underpaid, you have received a Demand for Payment and you have refused or failed to pay the tax or otherwise resolve your issues, a Notice of Judgment may be filed. The judgment in the amount of your tax debt attaches to all your property (i.e. your house or car) and rights to property (i.e. accounts receivable). A judgment will harm your credit rating and is a public notice to your creditors that you have a government claim against your property.
If the tax remains unsatisfied, the judgment will automatically continue for 20 years after the date of filing. The Notice of Judgment will be released within 30 days of paying or adjusting the full tax debt along with any interest or other charges.
Return to topThe Department of Revenue is currently revising the Compromise Procedures. No compromise requests will be accepted until the revision is completed.
Return to topIf you have an unpaid tax bill and have any refunds due to you, the refund will be offset and applied to your unpaid tax debt.
Return to topYou may represent yourself or you may authorize an attorney, certified public accountant, enrolled agent or any person enrolled to practice before the Delaware Division of Revenue to represent you. To permit another person to have access to your tax information in Delaware you should submit any properly written power of attorney or use IRS Form 2848, Power of Attorney and Declaration of Representative, or IRS Form 8821, Tax Information Authorization.
Return to topThe DE DOR may seize and sell any type of real or personal property that you own or have an interest in if you fail to pay or make arrangements to pay your tax bill. This includes residential and business property. After property has been seized a public notice of pending sale must be given. After giving notice, DE DOR must wait 10 days before holding the sale unless the property is perishable.
Return to topIf a warrant has been filed and your salary or wages are attached, your employer will be required to withhold and forward your garnished wages to the Department of Revenue to satisfy your tax liability.
Return to topThe Delaware Division of Revenue may use a warrant to enforce collection of taxes that have not been voluntarily paid. A warrant gives legal authority for DE DOR to take property, either real (cars, houses, boats) or held by a third party (wages, bank funds), to fulfill the tax liability. In order for DE DOR to take warrant action, the following requirements must be met:
If the Division of Revenue believes that collection of the tax is threatened, for example the taxpayer leaving the country quickly, immediate action may be taken without the 3 requirements being met.
Return to topWe strive to save our clients money, time and stress. Just as there are many different tax related problems, there are many options for tax resolution. Call us at 888-902-0778 for a free consultation. In a few minutes we will help you to better assess what options are best for your unique situation.