It is possible to get a factoring company to finance a business with tax problems. The difficulty is determining where you are in the IRS process. If the tax deficiency is a rather minor one and the business does not have a history of delinquencies then it can be safely handled by mail correspondence where you commit to paying the outstanding amounts plus all penalties and interest.
If the problem has been going on for a while and the business is not really responding to frequent letters from the IRS, eventually an agent will be assigned. Again if it’s a relatively recent situation and you can convince the agent that you plan to clear it up in short order often they will cooperate as long as commitments are met.
Failure to make a commitment with the IRS will inevitably end up with a IRS lien against your company (including all accounts receivable) and for delinquent payroll taxes, the lien will travel through the company and directly to the owner of the company personally. Once a lien is in place then a payment plan has to be negotiated. And when the payment plan is in place you MUST make your payments. Because that is the only way the IRS will subordinate their lien to a finance company in order to get invoices financed. The IRS understands that a company needs capital to survive, but if they are dealing with a company that shows a pattern of chronic delinquency then they are less likely to subordinate their position on all the company assets.
In the game of collateral, an IRS lien trumps all hands it’s the Royal Straight Flush. So borrowing (not paying taxes) from the IRS is one of the worst deals you can play. Best to keep them off the table by keeping your liability current.