It is always a good idea to understand how a IRS debt may be relieved, and what options are available for you.
In most cases, the amount owed to the IRS (“IRS Debt”) is a money issue, and does not cross the line to being a criminal matter of being charged with tax evasion. The IRS will charge interest and penalties on the tax debt, so its critical to try to resolve the issue, through a settlement or quickly paying the debt, before the amount increases beyond your control. The IRS debt is special and should be thought of as having more issues than other debts since the IRS can take money from you bank account, or take your wages when you owe them, and they can do all of this without your permission.
The IRS trains their collection people well, so once they get assigned to your case there will be a lot of work to resolve the matter and they will make your life unpleasant. They will send a ton of notices, and even come to your home to interview you. Its best to be polite, but do not give them any detailed information and tell them you need to hire a tax attorney to resolve the issue. They will request financial information in the Form 433-A, which is for individuals, or the Form 433-B, which is the form for businesses. Along with these forms that will require the last six months of your bank statements, and information to verify your income and expenses, such as copies of bills, mortgage payments, pay stubs etc.
The financial issue of having IRS Debt is best handled by becoming informed about the details of the potential solutions, and implementing a plan of action.
- It best to hire a tax lawyer, since the IRS is difficult to deal with, and the outcome will be better.
- The IRS makes mistakes in how much you owe, so the first step is to determine your actual liability and file any tax returns that have not been filed.
- If the tax debt can be paid in 60 or fewer months, a tax payment plan may be the best options. If the tax debt will require more time to pay, then a settlement may be the best choice.
Remember that while it is very helpful to pay the IRS debt quickly, you do not want to arrange a payment plan that pays to much per month and you end up defaulting and being in trouble. However, do not fall into the fear that your going to jail for not paying your taxes. Unless you willing filed false tax returns, or have evaded paying your taxes, you have not real risk of be incarcerated.
The Internal Revenue Service Tax Debt Settlement Solution…
The IRS has the ability to settle your taxes for less than what you owe when you have IRS Debt. While the tax negotiations can be difficult, the results can be very welcoming that the tax debt has been brought down to a level that is affordable to pay. The process takes about 4-8 months, and requires providing a complete financial picture to the IRS of your ability to repay them. This time is worth it if you can get them off your back, and you can start living again.