If you are facing a financial hardship, there could be tax implications that make your situation more difficult. You should visit the IRS’s The “What Ifs” for Struggling Taxpayers; you’ll find information relating to a variety of situations and how the IRS might be able to help you. For example, you’ve become unemployed and you are having difficulty keeping up with an installment agreement. The IRS recommends that you call the IRS and explain your situation; options are available including reduction of the monthly payment to reflect your current financial situation.
In general, you should contact the IRS ASAP to explain your situation. Ignoring the situation (and the letters from the IRS regarding it) will only make matters worse; you might miss critical deadlines for required action on your part.
