Different Agencies, Different Rules
The IRS gets all the attention, but state tax agencies can be equally aggressive and sometimes harder to deal with. Each state has its own collection procedures, its own statute of limitations, its own penalty structure, and its own settlement programs. What works with the IRS may not work with your state.
Collection Statutes Vary Wildly
The IRS has a 10-year collection statute. States vary enormously. California has a 20-year collection statute. New York has no statute of limitations on collecting tax debt. Florida has no state income tax so this is not an issue for Florida residents, but if you owe taxes to another state, their rules apply.
State Agencies Can Be More Aggressive
Some state agencies are more aggressive than the IRS. They issue levies faster, with less notice, and with fewer administrative remedies. California's Franchise Tax Board is notorious for aggressive collection. They can levy bank accounts and wages with minimal warning and the administrative appeal process is limited compared to the IRS.
Resolving State and Federal Together
If you owe both state and federal taxes, the resolution strategy needs to address both. Sometimes the IRS resolution drives the state resolution. For example, if you get an offer in compromise accepted by the IRS, some states will accept a proportional offer. Other states have completely independent programs.
A tax attorney who handles both federal and state tax issues coordinates the strategy. Resolving one without considering the other can create problems. For example, an IRS installment agreement that uses all your disposable income leaves nothing for the state payment plan.