Income Tax Debt Relief ServicesDealing with unpaid taxes can be a stressful and time-consuming experience, and it can be distressing to receive an IRS notice of deficiency. Income tax debt relief services can help you settle your debt for less; hire tax professionals to navigate the IRS tax relief programs available and ensure you reach the best settlement possible.
What Is The IRS Tax Relief Process?The IRS tax relief process is the process through which a taxpayer resolves a tax debt issue with the IRS. IRS tax relief solutions may include an installment agreement, Offer in Compromise, and in rare cases, tax debt forgiveness. In order to qualify for tax debt relief, you must appeal to the IRS. Typically, the tax relief process looks something like this:
- Step 1: Identifying the issue
- Step 2: Investigating the cause
- Step 3: Identifying the solution
- Step 4: Building the case
- Step 5: Submitting the case
- Step 6: Tax relief
Income Tax Relief ProgramsAs we mentioned, the IRS offers a number of tax relief programs that can make paying off tax debt more manageable, and in rare cases, not necessary at all. Below, we’ll take a look at some of the tax relief options that may be applicable to your situation. Keep in mind, you must apply for and be approved for these tax relief solutions with the IRS.
Installment AgreementsIf you cannot currently pay your tax debt in full, but have the ability to pay what you owe back over time, you may choose to apply for an IRS installment agreement. An installment agreement allows you to pay off your tax debt in smaller increments over a predetermined period of time. If an installment agreement is approved, the IRS will immediately put a stop to any wage garnishment, property seizure, or federal tax lien. This will also help reduce any failure-to-pay penalties they are currently enforcing, lessening the overall amount of money you’ll owe over time. Community Tax offers installment agreement advice within our income tax debt relief services program. We can help you negotiate a monthly payment plan catered to your unique circumstances.
Can I Settle My Debt for Less?With the help of a tax professional, it is possible to pay less than the total amount you owe. There are various IRS tax relief programs available, including the government’s Offer in Compromise program and declared uncollectible resolutions.
Offer in CompromiseThe Offer in Compromise or OIC program is an Internal Revenue Service feature that allows any qualified taxpayer with unpaid tax debt to negotiate for a settlement that is less than the total outstanding balance. While rare, if approved, taxpayers may find the IRS will forgive debt in the hopes of receiving as much of the total bill as possible. In order for the IRS to approve an offer in compromise, the taxpayer must meet one of the three following conditions:
- Effective Tax Administration
- Doubt as to Collectability
- Doubt as to Liability
Currently Not CollectibleIf currently declared not collectible, your tax debt will be put on hold for a set period of time due to your hardship status. While your account is in this status the IRS will generally stop all collection activities, meaning your assets and income won’t be levied. However, your debt may still accrue interest and other failure to pay penalties and the IRS is still able to file a Notice of Federal Tax Lien, which can affect your credit rating negatively. Before you can file for a Currently Not Collectible (CNC) status, you’ll need to file any delinquent tax returns the IRS will also need a detailed look at your financial information, including:
- your income status
- current expenses
- and other debts you may have incurred, like student loan or mortgage debt.