Nebraska Notice of Collection Assignment Checklist
Introduction
A Notice of Collection Assignment from the Nebraska Department of Revenue means the state has transferred your unpaid tax debt to a collections unit for enforcement action. This notice indicates that initial collection attempts have not resolved the debt, and the state is moving toward more serious enforcement tools, such as wage garnishment, bank levies, or property liens. Ignoring this notice does not make the debt disappear; it typically triggers escalated collection activity. Therefore, understanding what the notice means is essential to protect your interests.
What This Notice Means
This notice tells you that Nebraska has officially assigned your tax case to its collections division or a private collection agency working on behalf of the state. The assignment means the state has decided your account requires active enforcement beyond routine billing letters. You are receiving this notice because you have unpaid delinquent taxes, and the state is now pursuing collection through methods that may include contacting your employer or bank or filing a lien against your assets.
Why the State Sent This Notice
Nebraska typically assigns delinquent tax claims to collection when you did not respond to notices requesting payment after prior billing notices, your account has remained unpaid past the standard collection timeline, or the state has determined that routine reminder letters are unlikely to resolve the debt. The Tax Commissioner is legally required to provide you with notice before certain enforcement actions are taken. This notice serves to fulfill that requirement and formally informs you that your case has entered the collections phase.
What Happens If You Ignore This Notice
If you do not respond or arrange payment, the state may proceed with enforcement actions. Nebraska may garnish your wages by directing your employer to withhold up to 25 percent of your disposable earnings or 15 percent if you are the head of a family. The state may levy funds from your bank account by freezing and taking specific amounts, except for those specifically exempt. The state may file a lien against your real property or other assets or offset your state income tax refunds or other state payments owed to you.
Understanding Collection Procedures
The state follows specific collection procedures governed by Neb. Admin. Code Chapter 36 for the collection of delinquent taxes. These procedures ensure due process while allowing the state to pursue public debts owed through various enforcement methods. The Tax Commissioner may use collection services or assign accounts to a private collection agency that has posted a bond guaranteeing compliance with state regulations. All collection actions must follow the notice requirement established in state law before enforcement begins.
Checklist: What to Do After Receiving This Notice
Step 1: Read the Entire Notice Carefully
Locate your name and identification number, the tax type and tax year or periods involved, the total amount owed including penalties, interest, and any collection fee, the collections office contact information, and any stated deadline for response. Write down this information so you can reference it when you contact the collections office.
Step 2: Verify the Debt Is Yours
Review your records to confirm you filed a return for the tax year listed, the amount owed matches your understanding of the balance, and the tax type is correct. If you believe the debt is incorrect, note specific discrepancies so you can clearly explain them when contacting the collections office about your concerns.
Step 3: Check for Prior Notices
Look through your mail and email records for earlier billing notices or demand letters from the Nebraska Department of Revenue that may have been sent by first-class mail, notices about assessments or adjustments to your tax account, and prior payment arrangement offers or notices requesting payment. Having this timeline helps you understand how long the debt has been unpaid and what steps the state has already taken.
Step 4: Gather Your Financial Information
Collect current pay stubs showing gross pay and deductions, bank account statements showing your balance, a list of all current debts and monthly expenses, including credit card debt or medical debt, information about any recent job changes or income loss, and details about any hardship circumstances, such as medical bills or job loss. This information will be needed if you contact the collections unit to discuss payment options.
Step 5: Contact the Collections Office Listed on the Notice
Call or write to the office using the provided contact information and explain that you received the notice, your current situation (such as job loss or unexpected expenses), and whether you can pay immediately or need a payment plan. Be honest about your circumstances because collections staff typically base decisions on what you can actually pay rather than promises you cannot keep.
Step 6: Ask About Payment Options
If you cannot pay the full balance immediately, inquire about short-term payment plans that allow payment over several months. These long-term payment plans allow for payments to be made over a year or more, including details on whether penalties, interest, or collection fees can be waived, as well as whether the state accepts online payments or checks. Do not assume no options exist because payment plans are often available based on your financial circumstances.
Step 7: Get Any Agreement in Writing
If you agree to a payment plan or arrangement, request written confirmation via mail or email, confirming the exact payment amount, due date, payment method, number of payments required, and what happens if you miss a payment. Save all documents for your records, so you have proof of the agreement terms in case questions arise later.
Step 8: Make Payments on Time
If you have agreed to a payment plan, pay by the exact due date each month, use the payment method specified in your agreement, and keep receipts or bank statements showing payment. If you are unable to make a payment, please contact the collections office immediately to explain the situation and inquire about available options, rather than simply missing the payment without communication.
Step 9: Document All Communications
Keep copies of the original notice, notes of phone calls including date, time, person’s name, and what was discussed, copies of all letters you send, receipts for any payments made, and written confirmations of payment plans or agreements. This creates a record of your efforts and protects you if questions arise later about what was agreed upon.
Common Mistakes to Avoid
● Waiting to respond: Contacting the collections office promptly demonstrates good faith and may provide you with more options than waiting for enforcement action to begin.
● Ignoring follow-up notices or calls: If you have agreed to a payment plan, continued contact from the collection service may indicate a missed payment or an account issue that requires immediate attention.
● Paying without getting written confirmation: Always request and save written proof of what was paid, when it was paid, and how it was applied to your account balance.
● Assuming the debt will expire or be discharged: The statute of limitations for Nebraska state tax liens allows liens to remain in effect for three years from the assessment date if not recorded, or ten years from the date of recording with the Secretary of State. Collection efforts may continue unless the lien is properly discharged.
● Confusing tax debt with other obligations: Tax debt collection follows different rules than credit card debt or medical debt, and is not subject to the same statute of limitations that applies to consumer debts in Nebraska.
Frequently Asked Questions
Can I request a payment plan if I am unable to pay in full?
You can typically request a payment plan by contacting the collections office and explaining your financial situation. Whether a plan is approved depends on your ability to pay and state policy. Payment plans for individual income tax may extend up to 24 months, and payment plans for other tax programs may extend up to 12 months, depending on circumstances.
Will this notice appear on my credit report?
State tax liens do not appear on personal credit reports because the three major credit bureaus ceased including tax liens in their reports as of April 2018. However, tax liens remain public records that potential lenders could search independently. Wage garnishments and bank levies also do not appear on credit reports but may affect your financial situation in other ways.
Can the state take my entire paycheck or bank account?
The state cannot take your entire paycheck because Nebraska wage garnishment is limited to 25 percent of your disposable earnings or 15 percent if you are the head of a family. Bank levies are subject to specific exemptions, including federal Social Security Act benefits deposited within the last two months. However, Nebraska does not establish a general protected threshold amount for all bank account funds.
What if I am unable to afford to pay anything right now?
Contact the collections office immediately to explain your financial hardship rather than ignoring the notice. The state may consider temporary delays or reduced payment arrangements based on your documented inability to pay. Providing accurate financial information helps the Tax Commissioner determine the most appropriate collection procedures for your situation.
Received a State Tax Notice?
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This checklist is for educational purposes only and does not constitute tax or legal advice. Always review official IRS instructions and consult a qualified professional for guidance
