How a Skilled Tax Levy Attorney Negotiates With the IRS
The state of Tennessee is often associated with country music and bourbon whiskey. Families can also benefit greatly from the Volunteer State’s cheap property taxes and lack of a state income tax. Regretfully, not all taxpayers benefit equally from Tennessee’s low taxes. The lack of a broad-based personal income tax benefits Tennessee’s wealthiest 1 percent of households, who pay the lowest state and local taxes in the US, at only 2.8 percent of their income.
However, these profits are diminishing as the economy slows down. The Department of Revenue experienced a 21% rise in sales tax collections and a 68% increase in franchise and excise tax collections in fiscal year 2023. However, the increases in these taxes were somewhat offset by decreases in the collections of motor vehicle taxes and fees, gasoline, and fuel.
Consequently, there was a 1.9 percent decrease in the state’s general fund receipts. Additionally, a slower than anticipated recovery in corporate taxes was mostly responsible for the fall, with a minor portion coming from general fund cuts. Check out our website at https://www.tennesseetaxattorney.net/tax-levy-lawyer/ to learn more about tax levy matters.
County property tax effort as a percentage of assessed and market value decreased throughout the state. Each of the three Grand Divisions of the state had varying property tax rates, but the potential income that these rates might provide differed greatly from county to county (Figure 29).
However, as a percentage of market value, county sales and use taxes, which make up around 20% of Tennessee’s local government revenues, remained largely unchanged. More over half of the state’s counties had a rise in sales and use tax collections in 2023 compared to 2008.
According to the Institute for Taxation and Economic Policy’s “State Tax Competitiveness Index,” Tennessee comes in at number eight overall. However, there is a cost to not having a broad-based income tax: The lowest 20 percent of Tennessee families spend 8.9 percent of their income in state and local taxes, which is the fifth highest percentage in the country as compared to personal income.
With a 7% sales tax rate that is augmented by municipal rates, the state has one of the highest sales tax rates in the nation. The tax rate is 4% on groceries and 7% on prepared foods, candies, nutritional supplements, and alcoholic drinks. Tennessee has some of the highest fuel and cigarette excise taxes in the country in addition to these sales taxes.
The Department of Revenue will issue a Notice of Proposed Assessment and a Final Demand for Payment to any taxpayer who does not pay their taxes. The DOR may use collection measures including liens and levies if the taxpayer still doesn’t agree to pay. However, by submitting an installment plan or paying in whole, a person may be able to evade such collection operations. Another option is to file for bankruptcy, which lowers payments and helps people cope with debt issues.