The IRS has historically been known for towing a hard line with debtors. However, in recent years, the IRS Fresh Start Initiative has allowed more debtors to qualify for an Offer in Compromise. This allows them to pay back less than what they initially owed in taxes. Income and available assets must be considered when qualifying for this form of debt settlement. Basic penalty relief, in comparison, requires that only a minimum of financial information be released by those whose adjusted gross income is less than $100,000. The program releases some or all of the penalties accrued through late payments and allows taxpayers to set up a payment plan in order to pay back what they owe over the course of up to six years.
Right now is a fantastic time to get old debts settled and move forward in life free from their burden. The first thing those interested in IRS Debt Settlement should do is consider hiring a tax attorney. This is because, unsurprisingly, the laws regarding IRS debt repayment are still quite complex. An attorney can help clients to understand all of their options and ensure that they will find the best possible solution.
Solutions may include participation in one of the above-mentioned programs, flexible repayment, partial payment, penalty reductions, or even adopting non-collectible status. Each plan offered by the IRS has a different set of qualifications and a different application process. Navigating the complicated process of determining which of these programs an individual is eligible for and which will provide the best results is best left to a professional.
Many people find the stress of dealing with the IRS almost insurmountable, particularly when they owe substantial amounts of money. Most debtors are not actively choosing to withhold their taxes from the government, but are already in … Read More ...