👉If you need help filing taxes, visit Illinois Legal Aid Online.
If you owe back income taxes to the Internal Revenue Service (IRS) or the Illinois Department of Revenue (IDOR), the rules are different from other types of debt. Tax agencies have strong collection powers, and ignoring the problem can make it worse.
Why tax debt is different
Both the IRS and IDOR can collect without going to court. They can:
- Take money directly from your paycheck (wage garnishment)
- Freeze and take money from your bank account (levy)
- File a lien against your home or other property
- Keep your federal or state tax refunds
Interest and penalties add up quickly, sometimes making the debt much bigger than the original amount owed.
Your options for federal tax debt
- Payment plan or installment agreement). Pay over time in monthly amounts you can afford.
- Offer in Compromise. Ask the IRS to settle for less if you can’t pay the full amount.
- Ask for Currently Not Collectible status. Pause collections if you have serious financial hardship.
- Ask for a penalty abatement. Request removal of some penalties if you had a good reason for falling behind.
Your options for Illinois state tax debt
IDOR offers:
- Payment plans for up to 24 months in most cases
- Penalty and interest relief in certain hardship situations
- Tax amnesty programs (offered only occasionally)
What to do now
- Open all mail from the IRS or IDOR — deadlines matter.
- File any missing tax returns, even if you can’t pay right now.
- Contact the IRS (irs.gov/payments) or IDOR (tax.illinois.gov) to discuss your options.
- Get free or low-cost legal help from one of the resources below.
Help and resources:
- IllinoisLegalAid.org
- IRS Taxpayer Advocate Service – free help for resolving IRS problems
- Center for Economic Progress / Ladder Up Tax Clinic – free tax help in Illinois
Act quickly — tax agencies have more power than regular creditors, but early action can stop extra penalties and protect your income.