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IRS Fresh Start Program Qualifications

FLAT FEE TAX RELIEF

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IRS Fresh Start Program



Who Qualifies for the IRS Fresh Start Initiative? Individual taxpayers who are looking to pay their tax debt over time through an installment agreement with a direct payment structure can benefit from using the IRS Fresh Start Initiative when:

  • They owe less than $50,000 or can pay a larger liability down to that amount.

  • They can pay off the remaining debt in 60 months or less.

  • It’s the first time falling behind on tax payments with the IRS.

  • They agree to the direct payment installment agreement

  • Their tax filings are up-to-date through the most current tax year. The last 6 years of returns must be filed.

  • They maintain the installment agreement, stay current with tax filings, and don’t incur new tax debt during the period the installment agreement is in effect.

  • They file for an OIC and can pay the agreed settlement amount off within 12 months.

If a taxpayer can qualify for the IRS Fresh Start Initiative, certain bonus items may also come into play:

  • If they owe less than $25,000 or can pay their initial liability down below that amount, they may be eligible for the withdrawal of a federal tax lien.

  • A first-time tax debtor is also eligible for an abatement of specific penalties under these revised guidelines.

Do I qualify for the IRS Fresh Start Program? People who owe a tax debt of $50,000 or less to the IRS are qualified to initiate the Fresh Start repayment process at any time. How can I get my IRS debt forgiven? You can apply for the IRS settlement plan called an Offer in Compromise (OIC) to resolve the remaining tax liability. Depending on your financial capacity and upon acceptance, the IRS will dramatically reduce the total debt that you pay. This reduced amount can be paid in a lump sum or in fixed monthly payments.


Does IRS forgive a tax debt after 10 years?


In general, the Internal Revenue Service (IRS) has 10 years to collect unpaid tax debt. After 10 years, the assessed debt is wiped clean from its books and the IRS writes it off. This is called the 10 Year Statute of Limitations. You can imagine that It is not in the financial interest of the IRS to make this statute widely known. Is there "such a thing" as a one time tax forgiveness? If you feel you are overwhelmed by a penalty from the IRS and you are unable to pay based on circumstances beyond your control, you may qualify for IRS one-time forgiveness. This is called an Offer in Compromise. Despite the agency's reputation, the IRS often works with taxpayers in disadvantageous circumstances to alleviate undue tax burdens.


Currently the IRS has been approving an Offer in Compromise submission at a rate of 42% per year. Our team of tax pros feel that the IRS will soon be overwhelmed with taxpayers with tax debt due to the COVID pandemic. For this reason, we expect the IRS will need to expand on their approval rate. For more than a decade, the tax professionals at Flat Fee Tax Relief have averaged a 96% Offer in Compromise success rate.


The above article is brought to you by the tax resolution team at Flat Fee Tax Relief. We are strategically located in Clearwater, Florida, and San Diego, California. This allows our coast to coast team to be available from 8 A.M. Eastern to 6 P.M. Pacific time.



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