What to do when the IRS comes to collect.

Social Security benefits are eligible for levy by the IRS.

If you withdraw money from your individual retirement account before age 59 1/2, you will generally have to pay a 10 percent early withdrawal penalty in addition to income tax on the amount withdrawn. This means a $5,000 withdrawal taken by a mid-career worker in the 25 percent tax bracket would result in $1,750 in taxes and penalties. But there are a variety of ways to avoid the IRA early withdrawal penalty if you meet specific criteria:

There is a way to make tax liens disappear from your credit reports completely, and quickly, though. Unfortunately, not all taxpayers who are dealing with this problem know about it.

An offer in compromise allows you to settle your tax debt for less than the full amount you owe.