Indiana Final Notice / Intent to Enforce Checklist
Introduction
An Indiana demand notice is issued by the Indiana Department of Revenue when a tax debt remains unpaid after earlier collection attempts. This notice signals that the account has reached a critical point in the state’s enforcement process and requires a response within 20 days.
Indiana’s collection process is commonly described as three stages: notice of proposed assessment, demand notice, and tax warrant. Receiving a demand notice means the account is at the second stage, and timely action can help prevent a tax warrant that becomes a legal judgment and creates a tax lien.
What This Issue Means
An Indiana demand notice is a formal warning that gives 20 days to pay an outstanding tax debt or show reasonable cause for not paying. This notice is commonly issued after a return was filed without full payment or after a protest decision determined that tax is owed.
Indiana Code requires a demand notice before the state can issue a tax warrant. If the notice is not resolved within 20 days, the Indiana Department of Revenue may file a tax warrant with the county clerk, which becomes a legal judgment and creates a lien record.
Why the State Issued This or Requires This
Indiana Code Section 6-8.1-8-2 requires the Indiana Department of Revenue to send a demand notice before moving to the tax warrant stage. The notice must explain the 20-day deadline, the earliest filing date for a tax warrant, and the remedies available to prevent a judgment.
This step is intended to provide a final administrative opportunity to resolve the debt, request an installment agreement, or document financial hardship. If the matter is not resolved, the state can proceed with broader collection actions tied to the judgment and tax lien.
What Happens If This Is Ignored
If there is no response within 20 days, the Indiana Department of Revenue may issue a tax warrant and add a 10 percent collection fee to the unpaid tax. The warrant may be filed with the circuit court clerk in the county where the property is owned, or with the Marion County clerk if the property's ownership cannot be determined.
Once filed, the tax warrant becomes a legal judgment that creates a lien on real and personal property in that county. Enforcement may include wage garnishment, bank levies, and referrals for collection, and the judgment is valid for 10 years with renewal options.
What This Does Not Mean
Receiving a demand notice does not mean a tax warrant has already been issued or that enforcement has started. It does not automatically mean that wages are being garnished, that a bank account is frozen, or that property has been seized.
A demand notice is also not the same as a mechanic’s lien under Indiana’s Mechanics Lien Law or the Mechanics Lien Act. It does not involve lien rights for contractors, a Preliminary Notice, or a sworn statement and notice of intention to hold a mechanic’s lien, and a mechanic’s lien statute does not govern it.
Checklist: What to Do After Receiving This Notice
Step 1: Review the notice and confirm the 20-day deadline
Read the notice and confirm the amount due, tax years, and the 20-day deadline based on the mailing date. Keep it with your tax records because the notice number may be needed later.
Step 2: Verify the amount owed and confirm the tax years
Compare the balance to filed returns, prior notices, and payment history. If something looks wrong, gather records that support the correct amounts.
Step 3: Gather proof of payment and supporting records
Collect payment confirmations, canceled checks, and bank statements showing what was paid and when. Organize them by date so the Indiana Department of Revenue can review them quickly.
Step 4: Contact the Indiana Department of Revenue through INTIME or by
phone
Use INTIME or the contact information on the notice to reach the Indiana Department of
Revenue promptly. Provide identifying details and ask what options are available before a tax warrant is filed.
Step 5: Evaluate payment options based on the current financial situation
If full payment is not possible, ask about an installment agreement and confirm eligibility.
Request the terms in writing so payment amounts and due dates are precise.
Step 6: Ask about hardship relief or an offer in compromise
If financial hardship prevents standard payments, ask about the hardship financial statement process. Ask whether an offer in compromise is available through the taxpayer advocate office and what documents are required.
Step 7: Respond appropriately if the amount is disputed
If the liability is disputed, pay the full amount within 20 days and file a claim for refund. Include supporting documentation and keep proof of submission.
Step 8: Submit the response using a trackable method and keep proof
If mailing a response, use a trackable method and keep copies of all submitted materials. If using INTIME, save screenshots or confirmation numbers as proof.
Step 9: Follow up to confirm receipt and document all communication
Follow up within a few days to confirm the response or payment was received and applied.
Keep notes of dates, names, and a summary of each contact.
- State enforcement notices and responses
- Sales tax audits, assessments, and collections
- Payroll & trust fund tax enforcement issues
- Penalty and interest reduction options
- Payment plans and state tax relief eligibility
- Representation before state tax agencies
Step 10: Seek assistance if the situation is unclear or high-risk
Professional help may be needed if the balance is large or deadlines are approaching. A qualified tax professional or attorney can help reduce the risk of a tax warrant and tax lien.
What Happens After This Is Completed
If payment is made in full within 20 days, the Indiana Department of Revenue processes the payment and closes the collection stage tied to that notice. Written confirmation may follow once the account reflects a zero balance.
If an installment agreement is approved, written terms are typically issued, and ongoing compliance is required. If a refund claim is filed after full payment, the submission is reviewed, and a written response is provided.
Common Mistakes to Avoid
A common mistake is missing the 20-day deadline or waiting to act until the final days, which increases the risk of a tax warrant and added fees. Another frequent issue is relying on verbal assurances or submitting incomplete documentation, which can delay processing and lead to enforcement.
Frequently Asked Questions
What is the difference between a demand notice and a tax warrant?
A demand notice gives 20 days to pay or show reasonable cause. A tax warrant is filed with the county clerk as a legal judgment and creates a tax lien.
Can a payment plan be set up after receiving a demand notice?
Yes, an installment agreement may be requested through INTIME or by contacting the Indiana
Department of Revenue. Terms depend on the balance owed and require on-time payments.
How can the amount on the demand notice be disputed?
The full amount must be paid within 20 days, and a claim for refund of the disputed amount must be filed. Supporting documentation should be included, and the deadline still applies.
Will another notice be sent before a tax warrant is issued?
No, the demand notice is the final notice before a tax warrant may be issued. If there is no response within 20 days, the state may proceed without additional notices.
What does “show reasonable cause” mean?
Reasonable cause is a documented explanation for why the amount cannot be paid by the deadline. Supporting records should be provided, and the Indiana Department of Revenue should be contacted within 20 days.
Closing
A demand notice from the Indiana Department of Revenue requires immediate attention because the response window is limited to 20 days from the mailing date. Acting within that timeframe can help avoid a tax warrant that becomes a legal judgment, creates a tax lien, and expands enforcement options.
Resolution is typically achieved by paying in full, securing an installment agreement, or documenting financial hardship through available procedures. Prompt communication, complete documentation, and trackable submissions provide the best path to resolving the tax debt before the case advances.
Facing State Enforcement Action?
If you’ve received a notice related to sales tax or payroll tax enforcement, and aren’t sure how to respond, our team can help you understand your options and next steps.
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