What Is Tax Debt Relief Help?
The Internal Revenue Service (IRS) and State Tax Authorities both understand that tax payers will from time to time not have the ability to pay the taxes that are due. This happens so frequently that the IRS and State tax boards have created tax debt relief programs to help people in this situation. This is great news, however the drawback is that just like all things taxes, there are dozens of options, complicated qualifications and challenges in determining which tax debt relief plan gives you the best advantage.
This where Professional Tax Debt Relief Help comes in
A tax professional will review your exact tax debt(s) and financial situation, they will determine the tax relief options you will most likely qualify for with the IRS or State tax board. Finally and most importantly they will then work for you to process your request for tax relief and see it through until you have achieved results. Tax Relief Services are using IRS and State Tax Board programs to provide relief to you. Just as you may use an accountant to handle complicated tax returns, people with tax debts use tax professionals to handle their tax relief issues. You can get a free consultation to help determine what programs you may qualify for by sending in the consultation request on this page. Your consultation is 100% free with no obligation.
Common Tax Debt Relief Programs You May Qualify For
Below are general descriptions of common tax debt relief options and are not intended to be advice or to suggest an outcome for you. Advice should always come from a professional who has reviewed your specific situation.
IRS Offer in Compromise (OIC)
An Offer in Compromise is an agreement that allows taxpayers to settle their tax debt for less than the full amount. The IRS Fresh Start tax debt relief program expanded and streamlined the OIC program. The IRS now has more flexibility when analyzing a taxpayer’s ability to pay. This makes the offer program available to a larger group of taxpayers. Please note the IRS Tax Debt Relief Programs can change frequently. Please refer to the IRS website for the latest information on Offer and Compromise programs
Generally, the IRS will accept an offer if it represents the most the agency can expect to collect within a reasonable period of time. The IRS will not accept an offer if it believes that the taxpayer can pay the amount owed in full as a lump sum or through a payment agreement. The IRS looks at several factors, including the taxpayer’s income and assets, to make a decision regarding the taxpayer’s ability to pay. Use the Offer in Compromise Pre-Qualifier tool on IRS.gov to see if you may be eligible for an OIC.
IRS Penalty Abatement
The IRS may assess a variety of penalties on your tax account including late filing and late payment fees. Sometimes the penalties quickly grow to dwarf the actual tax debt.
The IRS may provide administrative relief from a penalty that would otherwise be applicable under its First Time Penalty Abatement policy.
You may qualify for administrative relief from penalties for failing to file a tax return, pay on time, and/or to deposit taxes when due under the Service’s First Time Penalty Abatement policy if the following are true:
- You didn’t previously have to file a return or you have no penalties for the 3 tax years prior to the tax year in which you received a penalty.
- You filed all currently required returns or filed an extension of time to file.
- You have paid, or arranged to pay, any tax due.
IRS Installment Agreement
This agreement allows you to pay your full debt in equal, yet smaller and more manageable amounts of time. You should request a payment plan if you believe you will be able to pay your taxes in full within the extended time frame. If you qualify for a short-term payment plan you will not be liable for a user fee. Not paying your taxes when they are due may cause the filing of a Notice of Federal Tax Lien and/or an IRS levy action. See Publication 594, The IRS Collection Process (PDF).
IRS Partial Pay Installment Agreement (PPIA)
All taxpayers are expected to immediately full pay delinquent tax liabilities. When this is not possible taxpayers may be allowed to pay their liabilities over a prescribed period of time. If full payment cannot be achieved by the Collection Statute Expiration Date (CSED), and taxpayers have some ability to pay, the Service can enter into Partial Payment Installment Agreements (PPIAs). The American Jobs Creation Act of 2004 amended IRC 6159 to provide this authority.
IRS Innocent Spouse Relief
As an innocent spouse, you might not be responsible for your spouse or former spouse’s tax liability if at least the following are true:
- The tax liability resulted from erroneous information on the joint return
- You didn’t participate or possess any knowledge of the erroneous information reported
Like any other tax relief program, there are qualifications you must meet and provide the IRS with adequate information to prove your case. The above are just two very general qualifications and not all you will need to meet.
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