The following is a guest post from Amy Lewis
Tackling the Internal Revenue Service is not an easy task, especially when you owe hefty tax debts to them. However, that definitely does not mean that you cannot do anything to resolve your tax issues. In fact, there are several solutions to tax debt problems that you can resort to. Here are some of the common ones available for your tax debt help :
Offer-in-Compromise: It is a settlement offer that you make to the IRS, when you cannot pay your taxes in full. You offer to pay as much as you can afford. On reviewing your financial condition, the IRS decides whether to accept or decline your offer. This program not only saves you interests and penalties but also gives you a fresh chance to clear your debts.
Installment Agreements: These are payment plans offered by the IRS to taxpayers, who are unable to pay their taxes in a single payment. Installment plans are broadly of 4 types and suited to the taxpayers’ requirements. There are several factors, such as your tax amount, your present income and future ability to pay, which determine if installment agreement or IRS payment plan is the best solution to your tax issues. Installment agreements can be a good alternative if you cannot arrange an offer-in-compromise. Also theses plans can be negotiated with the IRS.
Get a Penalty Removal: By an automated process performed by a computer, penalties are added to tax debts that you owe to the IRS. Often these penalties are found to be completely inaccurate. If you think penalties have been imposed on your taxes wrongly, then you can contest it by requesting the IRS that they waive off the penalties. However, it is advised that instead of contesting on your own, you consult a tax specialist who can help you fight and eliminate the penalties. In fact, penalty elimination can reduce your payable tax amount substantially and make it much easier for you to pay it off.
Place taxes under “Currently not collectible” status: If you are being unable to make payments towards your tax obligations due to hardships such as financial troubles, temporary illness, layoff or any other acute reason, then you can request the IRS that they put your debts under Currently Not Collectible or “hardship” status. Though it is a temporary solution, it can relive you of your present hardship. Tax debts are complex issues and not quite easy to handle. So, if you are going through a tough time with your taxes, you should talk to a reputable tax expert and seek for the right tax debt solution right away.
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