IRS Offer in Compromise Help
IRS debts may be aggressively pursued for repayment with the full backing of the government. They can balloon with fees, interest, and penalties, turning into what may seem to be an insurmountable amount. Taxpayers wonder what can be done when the debt is growing and they do not have the necessary capital to fully repay? There are a few repayment options offered by the IRS, some of which is for people who are simply unable to pay due to their expenses and income. One of these plans is called an Offer in Compromise.
The Offer in Compromise has gone through changes over the years, most recently in May 2012 when its terms became more flexible and amenable to those taxpayers who have financial issues. Some payments that can now be calculated into figuring a taxpayer’s expenses include student loans and even other tax debts. The way that the IRS looks at one’s assets has also changed for the better. It’s now easier to convince the agency not to include an asset that is no longer available or viable into their calculations of one’s income and assets.
If an Offer in Compromise is accepted by the IRS, there are two payment option types to choose from. Lump sum payments take the payments as large percentages of total debt while monthly installments break up the payments over a period of a few years. Speaking with a tax expert who can go over financial details can help with deciding which of these plans is best based on the financial situation.
Many people hire a professional tax company to help them through the often complex process of qualifying, applying, and dealing with the IRS. These experts can also help calculate initial payment offers with the agency as well as negotiate lower and better terms than most people can get on their own. It’s usually a comfort to not have to go through it alone and even better to do it with someone knowledgeable who can explain the steps with ease and can advise about what comes next.