Tennessee Active Collections Timeline Checklist

Tennessee Active Collections Timeline Checklist

What State Enforcement Means

State enforcement occurs when the Tennessee Department of Revenue takes active steps to collect unpaid taxes, pursue unfiled returns, or address compliance violations. This action typically follows initial notices that have not resulted in payment or filing.

Enforcement can include wage garnishments, bank levies, property liens, or other collection tools authorized under Tennessee tax law. Understanding what enforcement means helps you respond appropriately and understand the next steps in the collection process.

Why the Department Issues or Pursues Enforcement

The Tennessee Department of Revenue initiates enforcement when taxpayers have not responded to prior notices, have not made payment arrangements, or have failed to file required returns within the standard notice period. Common triggers include unpaid tax balances, unfiled business returns for sales and use tax or franchise and excise tax, or unresolved compliance issues related to business tax obligations.

What Happens If This Is Ignored

Ignoring an active enforcement action typically results in escalation of collection efforts. The state may expand the scope of enforcement to additional collection tools, pursue actions against additional income or assets, or increase the total amount owed through penalties and interest.

What This Does Not Mean

An enforcement action does not automatically mean criminal prosecution will follow, though criminal referral remains a separate possible outcome in cases of fraud or willful non-compliance. State enforcement does not eliminate your right to challenge the underlying tax liability or request relief options through the informal conference process.

Tennessee Active Collections Timeline

Identify the Type of Enforcement Action

Review the notice or communication from the Tennessee Department of Revenue carefully to determine the specific action being taken. Look for details about wage garnishment, bank levy, property lien, or other collection methods listed in the notice.

Note the department contact information, case number, and the notice date for all future communications. Determine whether the action relates to sales tax, franchise and excise tax, business tax, or another tax type administered by the department.

Verify the Tax Debt and Amounts Claimed

Request a complete account statement from the department showing the original tax balance, penalties and interest added, and any payments already applied. Review the statement against your own records of filed returns, payments made through the Tennessee Taxpayer Access

Point, and payment arrangements previously established with the department.

Determine Your Response Deadline

Locate the deadline for responding or taking action in the enforcement notice, and mark it clearly on your calendar. Note whether any appeal deadline or request for relief must be submitted by a specific date to preserve your rights.

Understand that missing this deadline may limit your options for challenge or relief under

Tennessee tax collection procedures. If the deadline has already passed, contact the department immediately to ask about extending it or preserving any remaining options.

Understand Which Collection Method Is Being Used

Wage garnishment requires you to request clarification on how much of your wages will be garnished and for how long the garnishment will continue. Contact your employer to confirm they have received the garnishment order, as Tennessee employers must notify employees within 24 hours of receiving such orders and respond to the issuing authority within 10 days.

Bank levy actions require you to contact your financial institution to understand which accounts are affected and whether funds have already been frozen or removed from your bank account.

Determine how long the levy will remain in place and inquire about submitting a hardship claim if the levy creates a financial emergency.

Property lien filings require you to obtain a copy of the lien filing from the department or through the county Register of Deeds office where the lien was recorded as public record. Understand that a lien secures the state's claim against your property and may affect your ability to sell, refinance, or borrow against the property.

Paying the tax debt does not automatically release a Tennessee Department of Revenue lien; you must contact the Special Procedures Section at 615-741-7074 to request formal lien release even after full payment. Property liens remain as public record even though they no longer appear on consumer credit reports as of April 2018.

Contact the Tennessee Department of Revenue

Call the department’s collection or enforcement division using the contact number on your notice and provide your account number or tax identification number. Confirm the current balance and the enforcement action in progress with the collections staff.

Assess Your Options for Response

Paying the full amount owed remains an option if you can immediately satisfy the tax debt.

Request an itemized breakdown of what the full amount includes and ask about payment methods available through the Tennessee Taxpayer Access Point or other approved channels.

Requesting a payment plan or an installment agreement requires contacting the department to discuss available options. All returns must be filed before requesting a payment plan. If a subsequent return becomes delinquent, the arrangement will be revoked under department policy. Taxpayers who have had two or more payment plans in the previous two years must submit a 25 percent down payment to be considered for another arrangement.

Relief or hardship consideration may be available by asking whether you qualify for penalty abatement or hardship status. Explain any circumstances that contributed to non-payment or non-filing, such as job loss, illness, or emergencies.

Challenging the underlying tax liability remains possible if you believe the assessment itself is incorrect. Taxpayers who receive a notice of proposed assessment may request an informal conference within 30 days following the date of the notice.

Ask about formal protest or appeal procedures and obtain information about the deadline for filing a formal protest through the informal conference process. Understand that challenging the liability may not stop enforcement unless you pursue a formal appeal process with proper documentation.

Document All Communication

Keep a written record of every phone call, including date, time, department representative’s name, and what was discussed during the conversation. Save copies of all notices, letters, and official documents from the department in a secure location.

Monitor Ongoing Enforcement Status

If enforcement was paused pending a payment plan or relief decision, monitor your paycheck or bank account to confirm the collection action has stopped. Check periodically whether any property lien has been released after payment or resolution by contacting the Special

Procedures Section for written confirmation.

Facing State Tax 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.