Failure to collect sales tax as required can lead to penalties, personal liability for the unpaid tax, and even criminal exposure or loss of your business license. However, there is always a solution, and the sooner you reach out for help, the better. This article outlines the consequences of not collecting sales tax and how to get into compliance, so you know what to expect. 

The IRS plans to automatically apply first-time penalty abatement for qualifying taxpayers, starting in the 2026 filing season. The automatic abatement applies to tax returns from tax year 2025 on failure-to-file, failure-to-pay, and failure-to-deposit penalties. 

An offer in compromise lets you settle tax debt for less than owed – but this program has extremely high rejection rates. That's because it's complicated, and typically, the best course of action is to work with a tax professional. 

As of November 21st, 2025, a federal court has issued a preliminary injunction that permanently shuts down the business operations of American Tax Services LLC and its related entities. According to the FTC’s complaint, the company misled consumers, impersonated government agencies, and failed to provide promised tax relief services. The preliminary injunction permanently halts all business operations of American Tax Service LLC and its related entities while the case proceeds. The FTC and the State of Nevada are seeking permanent bans that would prohibit the defendants from offering tax or debt relief services in the future.

The IRS can seize (levy) assets to pay your outstanding tax liability. That’s the hard news. The good news is that there are several steps you can take to avoid the seizure of your assets. Being proactive and creating a plan as soon as possible is the best way to avoid the loss of your home, bank account, or other assets.