Tax debt can cause great distress if left unresolved. This is because there are serious consequences if you do not pay the money you owe the Internal Revenue Service (IRS). These range from seizure of your property to garnishment of your pre-tax income.
You may slip into tax debts due to poor or non-existent bookkeeping, unforeseen developments in your business, or other personal circumstances.
There are solutions to your problem, especially if you catch up with the IRS early enough. Read on to know some of the most common IRS tax relief options available to you.
Know How Much You Owe
You can do this by requesting a transcript of your tax return from the IRS. This will show you the exact amount you owe, as well as any interest and penalties that have accrued. There are options available to help you resolve the debt and get back on track.
By requesting a transcript of your return, you can determine the exact amount you owe and explore the various tax relief options that are available to you. Check Silver Tax Group to understand more about tax relief options.
Negotiate a Payment Plan
Try to negotiate a payment plan on how to pay tax debt with the IRS, which may help to lower your monthly payments. You can also look into getting tax relief, which can help to reduce the amount of money you owe. There are many tax debt relief options available, so talk to a tax professional to see what would work best for your situation and how to afford the taxes.
Understand the “Currently Not Collectible Status”
The IRS understands taxpayers may experience financial difficulties that make it difficult to pay taxes. If you cannot pay your taxes, you may request what is called “Currently Not Collectible” status. This means that the IRS will agree not to collect taxes from you for a period.
To qualify, you prove that you cannot pay your taxes and that paying your taxes would create a financial hardship. If they approved you for Currently Not Collectible status, the IRS will stop collection activity and will place your account on hold. Interest and penalties will continue to add to your balance.
Understand What is “Offer in Compromise”
If you owe the IRS and can’t pay your tax debt in full, you may qualify for an Offer in Compromise. The offer will allow the taxpayer to pay less than the owed amount. It is a fresh start for the taxpayer after resolving their tax liabilities.
If you are unable to pay your taxes in full, an Offer in Compromise may be the solution you are looking for. The IRS will carefully consider your offer before making a decision.
Experience Tax Relief Today
Resolving IRS debt is to first try to know how much you owe and negotiate a payment plan with the IRS. If that is not possible, then you can look into other tax relief options, such as an offer in compromise or Currently Not Collectible status. No matter what, it is important to take action and not let the debt continue to grow.
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