Every year individuals and businesses alike find themselves in what feels like shark infested waters, that is, owing back taxes to the IRS. Of course if you owe a few thousand dollars and you can afford to pay them in full, then that’s exactly what you should do. But what if you owe over $10,000 and can barely get by each month? It’s for these people that obtaining an IRS debt settlement should be a goal. The first thing you need to do is determine whether all of your taxes have been filed. The reason for this, is that the IRS requires all your taxes to be filed prior to negotiating a tax settlement with you. You then need to start asking yourself question, such as why it is that you owe these taxes in the first place. Have you been charged penalties and interest? Did the IRS file taxes on your behalf, which caused you to owe more than you really should have? Do you have any kind of hardship that may assist with your negotiation? Have you received a Levy Notice? These are all crucial questions which when answered will let you know your options with regards to IRS debt settlement.
You have many options available to you and there many ways to achieve an IRS debt settlement. There is absolutely no reason for you to leave money on the table because the IRS imposes such harsh penalties and interest as a method of scaring tax payers. Most times you can negotiate a favorable deal as long as you know what you are doing and stay strong. You have rights as a tax payer and one thing you may want to remember is that the IRS works for us and not vice versa. This attitude may help you deal with your situation better. Exercise your rights and get what you deserve. But, there is a caveat to this attitude and that is not to take your confidence to mean you don’t have to deal with the situation. You need to jump on any IRS problem as quickly as possible or you could pay dearly for it.
Your IRS settlement can be on your terms if you play your cards right. The smartest way of dealing with IRS problems is consult a tax expert who knows the inner workings of the IRS as well as the ever changing tax codes and laws. Tax experts know how to use the regulations and codes in your favor and can do a great job chopping that IRS debt down to a manageable level. They are there to advocate for your best interest and see to it that you are not taken advantage of. By letting go of the reigns, you will relieve yourself from all the stress and heartache IRS debt can cause.
There are a couple of options that you have in going ahead with proposing a settlement. Those would be either doing it yourself, or hiring a professional to help you. If you choose to do it alone then you can find all sorts of information on the internet of how to complete the process. There are lots of hints and tips for handing in a successful proposal. If you decide to hire someone to help you out then read the fine print on the contract that you sign.
Installment Agreement: This is one of the most common programs offered by this federal agency. With the help of this program you can pay off the existing liability by monthly payments. It is more or less like paying your EMI (Equated Monthly Installment) or credit card debt. The IRS will decide how much you will pay for the monthly installment. Though you may have a say regarding how much you can actually afford, it is the federal author whose will take the ultimate decision. Often, the amount is quite higher.
If the IRS considers the taxpayer unable to pay off the debt, the individual may be filed under Currently Not Collectable status. As long as the individual does not have the ability to pay the debt, the Statute of Limitations (10 years) will continue until it expires. If, on the other hand, the individual’s financial outlook improves enough for him/her to pursue another method of tax debt resolution, then the IRS will seek to collect at that time.
