Menu

What To Do When You Owe The IRS Back Taxes

0 Comments

Not everyone gets a refund from the Internal Revenue Service (IRS). Quite a few people,in fact,owe IRS money. Things become complicated when people don’t have money to clear their IRS debt.

What to do when you owe the IRS backtaxes? Call a -.Fortunately,there is nothing major to worry about here. If your inability to pay IRS is genuine,the department would understand and look for workarounds. For example,it could put you on ‘collection alternative’,which means you may pay your debts off at a reduced amount or over a period. Quite a few people are not aware of these options and they,as a result,end up paying more money than what they should.

Inability to Pay

Every year,IRS sends notices to millions of taxpayers stating the balances they did not clear. This outstanding amount to the government could amount to billions of dollars. IRS views collections seriously. Therefore,it is vital taxpayers make necessary arrangements to address the issue. Failure in this regard could lead to account and wage levies,passport denial and property liens.

Collection Process

The IRS has instituted three collection methods to help taxpayers clear their debts,according to -: installment agreement,offer in compromise,and currently not collectible. These processes ensure no adverse collection methods are implemented.

Also called payment plans,an installation agreement lets a taxpayer pay the outstanding sum in more manageable,smaller payments. ‘Currently not collectible’ is a status that protects taxpayers whose necessary monthly expenses are more than their monthly incomes. For these people,paying the IRS will be a major financial burden.

‘Offer in compromise’ is a program that helps taxpayers renegotiate tax debt by perusing the non-cash and cash assets of the taxpayer. Also taken into consideration are future and monthly disposable incomes. Once a figure is determined,the taxpayer is expected to pay the sum in two years or less.

Leave a Reply

Your email address will not be published. Required fields are marked *

-