Tax Settlement Services
Every year, millions of taxpayers find themselves in debt to the IRS. What is more, many of these taxpayers simply can’t afford to repay their full balances. For this very reason, the federal government put several tax settlement services in place to help taxpayers pay off their tax debt. These settlement services exist to find an agreement between the taxpayer and the IRS as to what an individual can reasonably repay and what the IRS or state will accept from them. A tax settlement will typically involve a reduced balance and can involve completely removing an individual’s tax liability, if the case calls for such a move. A taxpayer’s financial situation is the main deciding factor to determine their specific path toward tax debt freedom.
There are many taxpayers such as you who ask themselves why they can’t just negotiate his or her personalized tax settlements on their own. However, a trained accounting and tax law professional has the expertise to organize your tax debt and find a solution in an expedient fashion. Convenience and organization is not the only attractive feature of hiring a tax professional. In fact, many taxpayers who try to represent their case before the IRS on his or her own will likely go in to the process unprepared, because they lack the finesse and knowledge that a seasoned expert will already have. If you go into a situation without understanding the ins and outs of tax law, you can miss a vital detail that will allow the IRS to reject your offer. Not everyone in the United States is taught what an Offer in Compromise is or how to determine their eligibility for Currently Not Collectible status. These tax settlement services are very difficult to negotiate without a strong case and a lot of support in the form of financial records.
It is important to understand that the IRS wants you to pay your taxes in whatever way possible. They want to collect their money, and they are willing to work with you to make that happen. Many taxpayers mistake the IRS as a harsh and unforgiving institution, however this is not necessarily the case. If you are responsive, willing, and prepared, the IRS will negotiate with you to create a mutually beneficial agreement between the two of you. The IRS will, however, collect all they can as much as possible according to your statements and how much they decide you can afford. This is why it is incredibly important to be responsive to the notifications that are sent to you by the IRS. The IRS will not bring the hammer down on you, so to speak, unless you are negligent in your response. Do not delay if you receive a notification of outstanding debt from the IRS—consult a professional immediately from Community Tax to prevent any incurred interest or penalties. If you are interested in the various options offered by the IRS, here are the most frequent described below:
Payment Plans and Installment Agreements
It is a common misconception that taxpayers must pay all of their debt in full right away. This leads to a lot of fear and intimidation that can make many taxpayers delay in making their payments, and in consequence gather penalties and interest along the way. Take note that this only makes the situation worse. If you instead present a speedy response, the IRS will be open to negotiating with you so that you can pay your taxes in a reasonable manner.
Consider monthly payments, for example. If you’re financially unable to pay your tax debt immediately, you can make monthly payments through what is called an installment agreement. As long as you make a promise to pay your tax debt in full, you can reduce or eliminate your payment of penalties or interest, and avoid pesky fees that would only hinder your financial situation. The IRS has the authority to determine how much you are able to pay every month. Keep in mind that before you can apply for any available payment agreement, you must file all required tax returns. There are no exceptions to this rule. Community Tax will help you by filing all of your back tax returns.
It is possible that you will be eligible to qualify for an online payment agreement. In order to qualify, you must meet certain terms. For example, you must owe $50,000 or less in combined individual income tax and penalties. If you are filing for a business, you must owe no more than $25,000 or less in payroll taxes.
Ineligible for an online payment agreement? You may still pay in installments. In order to do so, you must complete a Form 9465, Installment Agreement Request, and Form 433-F, Collection Information Statement.
If you are the owner of a small business, then you may apply for an in-Business Trust Fund Express installment agreement. Fortunately, these agreements do not usually require that you present financial statements or financial verification.
When you obtain an agreement, you need to understand and follow all of the terms required. First, you must promise to file all future tax returns on time and pay all taxes in-full and one time. You are also required to make all scheduled payments to stay in good standing. The payment must at least meet the minimum, but more can be paid at any time. Note, also, that all future tax refunds will be applied to your debt until the payment is completed.
After you make this agreement, you must avoid default at all costs. If you default, you will continue to accrue interest and penalties, which will only make your debt issue worse. We at Community Tax are ready to aid you to make successful payments and avoid default.
Offer in Compromise Agreement
An offer in compromise permits you to pay off your tax debt with less than the full amount that you owe. While the privilege of an offer in compromise is not as easy to obtain as the installment agreement listed above, it is possible to achieve if you have a legitimate reason as to why you cannot pay your full tax liability. For example, if you are in a situation that presents financial hardship, the IRS will take this into consideration. The IRS will analyze your individual situation by looking over your exclusive set of facts and financial difficulties. They will examine your income, required expenses, asset equity, and ability to pay.
The IRS will usually grant an offer in compromise when they surmise that the total amount of tax debt cannot be collected within a realistic time frame. It is critical that a professional sit with you and carefully comb through all possible payment options before submitting the paperwork for an offer in compromise. Our qualified tax experts at Community Tax will help you determine if this is the best option for you, and aid you in the process of filing an offer.
We Will Get You the Best Offer
As with the installment agreement offer, it is still required that you file all past tax returns and that you remain current with all filing and payment requirements online. You must also agree that you will file all taxes and pay any debt in the future on time and in full. Unfortunately, you are not eligible for an offer in compromise if you are involved in an open bankruptcy proceeding. Consider this before you apply for an offer in compromise. We at Community Tax will go through the pre-qualifier process with you to make sure you get the best out of your offer in compromise.
We Will Help You in Every Step of the Application Process
Community Tax professionals are happy to help you every step of the way in your application process for an offer in compromise. There is a detailed step by step process that can leave many taxpayers confused and frustrated at the amount of work they must do to apply. Save yourself the time and the headaches by letting us shoulder most of the work for you. We will go over the Offer in Compromise Booklet, known as the Form 656-B, so that you have a full understanding of the process. The offer package includes a 433-A for individuals or 433-B for businesses, and all specified documents that are essential for documentation. You will also receive a Form 656 for individual and business tax debt, and all must be submitted on a separate Form 656. The IRS also requires a non-refundable $186 application fee, as well as an initial non-refundable payment for every Form 656.
We Will Negotiate a Payment Offer
The IRS will determine your initial payment, and the amount can be different for everyone. The initial payment decision is based on your offer and the payment option you decide to choose. The options are listed below.
- Lump Sum Cash: You can make the decision to submit an initial payment of at least 20 percent of the total offer amount along with your application. You must then wait for written acceptance that will be returned in response by the IRS. The IRS will then allow you to then pay off the balance that remains in the offer in no more than five payments.
- Periodic Payment: First, you must submit your initial payment with your application. Note, then, the IRS requires that you continue to pay the remaining balance in monthly installments while the IRS considers your offer. If the IRS accepts your offer, you will continue to pay the monthly amount designated until the debt is fully paid.
In the case that you are unable to pay, we will help you determine whether you meet the Low Income Certification guidelines. If you meet these prerequisites, you will be permitted to not send the application fee or the initial payment. In this case the IRS will permit you to not make the initial payment or meet the monthly installments while your offer is evaluated by the IRS.
Know the Ins and Outs of the Process
Similar to the installment agreement, you will have to become educated on all matters of the offer in compromise process. Take note that while the IRS evaluates your offer, you must agree to make all payments agreed to in the offer. You are also not required to make payments on an existing installment agreement. In addition, all other collection activities are temporarily halted. Also, your non-refundable payments and fees will be automatically applied to your tax debt, and finally, a Notice of Federal Tax Lien may be filed.
Reach Out to Us Today
Does all of this information sound overwhelming? It doesn’t have to be. If you want to obtain a settlement with federal or state tax agencies but are intimidated by the process, do not delay to reach out to our tax professionals for help. When it comes to obtaining a settlement with the federal or state tax agencies, the best move for most taxpayers is to hire a tax resolution company right away. Community Tax’s practitioners have experience saving clients upward of millions of dollars through the Offer in Compromise and Currently not Collectible programs, in addition to the other tax settlement services made available through the IRS. Clients that reach out to us often benefit from a dedicated team of professionals who have successfully negotiated for a settlement hundreds of time, so you can trust us to handle your case with great care. We are committed to getting the best personalized agreements for everyone that comes to us. It is our passion to provide continued support beyond the end of the resolution process, which is why hiring Community Tax is the obvious choice for many of those in tax debt. Act now and call us today for more information about how Community Tax can assist you with your settlement needs 1-888-676-4319.