Tax Settlement Help


Tax Settlement: Getting Help From The IRS

The IRS has programs that offer tax settlement to taxpayers who want to clear their tax liability. These programs can be availed of by those who have a hard time paying their tax debts as long as the IRS can see that they want to settle their delinquent taxes. There are different types of options that taxpayers can choose from. In most cases there should a convenient program applicable to their situation. The IRS wants taxpayers to pay their IRS back taxes in full but they are often willing to make an exception for those who are economically distressed.

Types of Tax Settlement Available

Tax SettlementOne tax settlement that you can avail of is an offer in compromise. This is usually the most advantageous settlement. It can be difficult to qualify for and you have to commit to pay a certain amount upfront to the IRS in order to be considered. You must also get the IRS to agree to the amount you will “offer” pay to settle your delinquent taxes.  This can be quite difficult at times because you have to demonstrate that you cannot otherwise pay the full amount AND that you can afford the proposed tax settlement.

The IRS installment agreement is a form of tax settlement wherein you can pay your tax debt through monthly installments provided you pay the whole amount within 3 years.  If your debt does not exceed $25,000, you can generally easily avail of this. But if you owe more than that you should seek the help of a tax attorney or other tax professional to guide you. There is also the partial payment installment agreement wherein the taxpayer agrees to pay back taxes to the IRS incurred way back.  For those who cannot remit the monthly payment stipulated in the installment agreement program, they may be able to avail themselves of the partial payment tax settlement installment agreement.

The penalty abatement on the other hand is a tax settlement that gives you the chance to waive some if not all of your tax penalties. However, you are still required to pay the whole amount of the tax you owe. You can only qualify for this if you would be able to justify your reason why you were not able to pay your dues. Your reasons must be serious, for example, hospitalization or death of you or any family member, bankruptcy in your business, if you were a victim of a calamity, accident or civil disturbance, or if you were wrongly advised by IRS personnel causing you to not pay or to underpay your taxes. But you have to prove and show evidence to support your claim.

Find Out If You Qualify for A Tax Settlement

If you are able to prove that you will pay your taxes once your financial problems are solved, you can apply for the non-collectible status or financial hardship agreement. If you qualify for any of these, apply immediately. You have to remember that the IRS will always diligently pursue their job of collecting taxes and they will not let anything or anyone stand in their way. But, they also are willing to work with people in financial difficulties. That is why they offer tax settlement programs and why you should get help if you need it.

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