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The IRS is the most powerful collection agency in the U.S. No other institution has the legal power to seize your property, garnish your wages, help itself to your bank account, place a tax lien on your property and/or throw you in jail...just to get you to pay a debt.

Penalties and interest add up by the day if you haven't paid the IRS what you owe them. And they add up big-time if you haven't filed at all. Every day that you put off taking care of your IRS problem only makes it worse.  Did You File and Not Pay? If you did, there's interest being compounded daily on what you owe, which is the quarterly federal short-term tax rate, plus 3%. As of this writing, the IRS is charging 4% per year.

The Internal Revenue Service recently released information that government employees on Capitol Hill owe overdue taxes worth $9.3 million, as part of the per agency IRS debt breakdown. It is not clear whether there are some Congress members guilty of not properly paying their taxes, as the agency refused to specify those involved.

The IRS can take 15% of your Social Security payments to satisfy your tax debt. Prior to 1996, there was a $750/month "off limits" amount that had to be left for the Social Security recipient.

On April 20, 2009, in St. Paul, Minn., Kara Kristine Sommer, of Burnsville, Minn., was sentenced to 18 months in prison and three years of supervised release for failing to pay the Internal Revenue Service (IRS) payroll taxes from employees of a construction business.

When the IRS prosecutes, tax evasion is not always the only charge (if it's charged at all). In fact, there are cases where the person who has been found guilty of one crime may also be charged with violating other laws.

Every month I choose a very special Client of the Month. It's my way of acknowledging good friends and saying "thanks" to those who support me and my business with referrals, word of mouth and repeat business.

On March 19, 2009, Keith Kuchenbecker, of Neenah, Wisconsin, was sentenced to 21 months in prison and ordered to pay $288,546 in restitution to the IRS. Kuchenbecker pleaded guilty to failing to pay over to the IRS approximately $197,000 in payroll taxes that had been withheld from the wages of the employees of his business, Keith Kuchenbecker Construction, Inc. According to documents filed in federal court, Kuchenbecker was responsible for paying payroll taxes that had been withheld from the wages of the employees of the business.

 On July 2, 2009, Scott Alexander, of Merriam, Kan., was sentenced to one year and a day in federal prison for mortgage fraud. Alexander pleaded guilty in January to one count of conspiracy to commit wire fraud and money laundering. In his plea he admitted that in 2003 and 2004 he conspired with co-defendant, Wildor Washington, Jr., and others to obtain mortgage loans by fraudulent means including submitting inflated property appraisals to lenders.

When I counsel people dealing with IRS problems, I usually end up asking the one big nagging question ....."Why did you wait so long to do something about this?" Here's the usual reply: "I thought I would end up going to jail."Let's go ahead and get something straight about the IRS and prison time...