Addressing South Carolina Delinquent Tax Problems

Although there are similarities between methods of dealing with South Carolina tax problems and federal tax problems, there are also many differences.  Frankly, there are not as many options for settling state taxes as there are for federal taxes.  However, there are options for the taxpayer.

 

The primary thing you want to avoid is a South Carolina levy on your wages.  This not only results in more withholdings from your paycheck than you can afford, but also often times upsets the employer due to the extra paperwork and sometimes ends in termination.  Unlike the IRS, if the state levies a taxpayer, they will not release the levy for a voluntary payment plan.  The most they will do is reduce the amount of the levy payments.  Generally the state takes 25% of gross income in a wage levy. Remember that it is always easier to reach a solution before a levy is imposed than after.  The IRS will release wage levies if the taxpayer agrees to enter into an Installment Agreement.

In addition, the state is not as flexible in the amount and duration of a payment plan as the IRS. Under certain circumstances, the state will abate penalties charged against a taxpayer, but are not as lenient as the IRS in doing so.  Finally, it is much harder to get a South Carolina Offer in Compromise.  The state’s general attitude is that they will try to collect as much as possible, but will not lower the amount of tax due.

In conclusion, the primary forms of solving South Carolina tax problems involve an Installment Agreement and an Appeal for Penalty Abatement.