What's an IRS Collection Due Process Hearing?

Eric Chandler from Los Angeles wrote me asking what he could do to fight an IRS assessment that he believed he didn't owe. Eric received a Notice of Federal Tax Lien ("FTL") recently claiming he owed $29,000. However, he claims the assessment was adjusted over a year ago to only $3,000.

Should Eric have to live with a $29k tax lien on his credit report if he only owes $3k? NO!

So how does he fight it? My first recommendation would be to file for a Collection Due Process Hearing (a "CDPH"). You only have 30 days to file for this so make sure you get it in on time. The CDPH allows you a forum with the IRS to present evidence as to why you believe the IRS's actions are incorrect.

Eric should request the CDPH as soon as possible and be prepared to present his arguments that the lien for $29,000 should be removed. Of course, Eric, you should also expect the IRS to re-file a new tax lien for the $3,000. The only way to get out of that is pay the $3,000 debt off, or reduce it with some of the other methods I've discussed.

Good luck and take care.