FLAT FEE TAX RELIEF
Coast to Coast - IRS Help
IRS Tax Relief - Tax Debt Help
TAX DEBT HELP
Here are four tactics that could help you get your tax bills under control.
1. INSTALLMENT AGREEMENT
2. OFFER IN COMPROMISE (OIC)
3. CURRENTLY NOT COLLECTIBLE (CNC)
4. HIRE A TAX RELIEF COMPANY
Taxes are already complicated, and if you get behind on paying them, things can get intolerable. When taxes are delinquent or overdue — typically from previous years — they are referred to as “back taxes.” If you have a tax debt, you might be wondering about tax debt help.
Here are four common options that could help you find some relief, plus guidance on how to file back taxes and how many years you can file back taxes for.
1. IRS payment plans
If you need time to pay your tax debt, the IRS will probably give it to you in the form of a payment plan. An IRS payment plan will allow you to pay back your overdue tax bill (plus accrued interest and fees) as installments over a period of time.
The IRS offers two types of installment plans — short-term and long-term.
Here are a few things to know about getting tax relief via an IRS payment plan:
a. A payment plan doesn’t get you out of interest and penalties for late payment. Those accrue until your balance is zero.
b. If you owe more than $25,000, you have to make your payments via automatic withdrawals from a bank account.
c. If you make your payments with a debit or credit card, you'll have to pay a processing fee. The charge for debit cards runs about $2 to $4 per payment; the charge for credit cards is about 2% of the payment.
"Low-income applicant" generally means your adjusted gross income is at or below 250% of the federal poverty level. You can see if you qualify on IRS Form 13844.
2. Offers in Compromise (OIC)
You might be able to find tax relief through what’s called an "Offer in Compromise." An OIC lets you settle your back taxes with the IRS for far less than you owe. According to the IRS, it may be the perfect tax relief option if you absolutely can’t pay your tax debt or if doing so creates a financial hardship. What does "financial hardship" mean? It's when a taxpayer has little to no money left over after paying their "allowable expenses."
Yes, it's harder to get the IRS to sign off on an Offer in Compromise than on a payment plan. It is obvious why that is so. The IRS, historically, accepts fewer than half the requests (approximately 38 to 42 % yearly). There are various reasons why this is so, but, at the moment in time, the IRS is stretched thin due to COVID. The IRS is so far behind in processing tax returns that our Tax Attorneys feel that there may never be a better time to submit a tax settlement.
3. 'Currently Not Collectible status (CNC)
If you can't pay your tax debt and your living expenses, you can ask the IRS to put your account in what’s called "Currently Not Collectible" status. CNC is similar to an OIC regarding eligibility. The big difference between CNC and an OIC is this: To have the IRS settle a tax debt, the tax debt must be $10,000 or more.
You need to request this delay in collection, and the IRS may ask you to complete a Collection Information Statement to prove your finances are as bad as you say they are. You'll need to supply information about your monthly income and expenses on that form.
Here are some things to know about this form of tax debt help:
1. It's temporary — the IRS may review your income annually to see if your financial situation has improved.
2. Being deemed "Currently Not Collectible" doesn't make your tax debt go away.
3. The IRS can still file a tax lien against you. If you own a home, a tax lien will make it difficult to re-finance. If you sell the home, the IRS will take the proceeds to pay off the tax debt.
4. Credit reporting services no longer list tax liens on credit reports.
5. The Statute of Limitations continues to run out which limits the time that the IRS has to collect the tax debt. It is possible that the tax debt simply goes away.
4. Hiring a tax relief company
Tax relief companies typically offer to tax debt help for taxpayers with an IRS problem.. Some of them can be helpful if you’re confused about the process or need help filling out forms. Remember this:
The number one reason the IRS rejects most applications for an Offer in Compromise is that the taxpayer tried the "Do It Yourself" method. The IRS has an entire division that spends all of its time looking for errors on OIC submissions. Should the IRS find anything wrong, the Offer in Compromise is rejected as being "unprocessable." The IRS will not detail what was wrong. Back to square one you go.
Beware of tax relief companies that charge you a fee to determine how much you owe the IRS. These tax relief companies describe this as an "investigation." They usually charge $500 for this useless service. The $500 goes to their salesman and the advertising that got you to inquire of their services. These calls are happening automatically when submitting the Power of Attorney (IRS Form 2848). Keep the $500 in your wallet and hire a tax relief company that forgoes the $500 gouging.
The above information has been provided by the IRS problem solvers at Flat Fee. Not only are we accredited by the Better Business Bureau but we have a 5-star rating. Our Tax Attorneys have a 96% Offer in Compromise success rate.