What’s happening
The Arkansas Department of Finance and Administration (DFA) is Arkansas’s tax office. They collect state income tax and sales tax. They also collect the taxes businesses take out of their workers’ paychecks.
When you owe the DFA and don’t pay, they send letters first. If the bill still isn’t paid, the DFA can file a paper called a Certificate of Indebtedness with the clerk at your county courthouse.
That paper is a big deal. Once it’s filed, it counts the same as a court ruling that says you owe the money. And it’s public. Anyone who checks the county records can see it.
What the DFA can do, and what it can’t
After the certificate is filed, the DFA has strong ways to collect. We list them below. If you own a business, the threat to your sales tax permit is often the scariest part.
But the DFA has limits too. They usually have 10 years to start collecting a tax. They have to follow their own rules before they file a certificate. And Arkansas does offer some ways out:
- payment plans
- dropping penalties in some cases, like a serious illness or a natural disaster
- settling for less, if you qualify
How we fight it
First, we check whether you really owe it. State tax bills can be wrong. Sometimes the state guessed at your income because a return wasn’t filed. Sometimes deductions were left out. Sometimes there are penalties that shouldn’t be there. And sometimes a change to your federal taxes got copied onto your state taxes the wrong way.
We talk to the DFA so you don’t have to. We deal with them for you. You don’t have to figure out a state system that doesn’t explain itself.
We look at every option Arkansas offers. That means asking the state to drop penalties, setting up a payment plan that won’t fall apart, or making an offer to settle when you qualify.
We handle the IRS at the same time. Lots of people who owe the DFA also owe the IRS. The two cases affect each other. Fixing them together keeps one from getting worse while you work on the other.
Good to know: Anyone can look up the DFA’s certificate at the county courthouse. If you’re selling your home or getting a new loan on it, talk to us early. It can hold up your closing.