Smart Ways to Get IRS Tax Debt Relief
Posted December 1, 2010 by Bernz
For most Americans tax debt is a matter of serious anxiety, especially at a time when the US is bearing the brunt of a downturn economy. So, along with the rest of your finances, it is extremely important that you take control of your tax issues and try to resolve them as fast as possible.
If you are suffering with tax debt burdens and wondering how to get out of tax debt, then considering the following options for tax debt relief can be quite helpful for you:
- Penalty Abatement
Your tax defaults add penalties to your tax amount, expanding it into a huge figure. If you think the penalties have been added mistakenly, then you can legally request that the IRS removes those penalties. However, before you seek for penalty abatement, make sure you collect all the required documents to prove that you should not be penalized. Waiving of penalties often lowers your tax burdens greatly.
- Request for time limit extension
If your finances do not look promising and you are unsure as to whether you will be able to pay your taxes by the April 15 or not, then you should request that the IRS stretches the time limit for your debt payments. But make sure you request for the extension before April 15; otherwise the IRS might reject your request. Such extensions normally vary from 30 days to 120 days according to the kind of situation you are in. But take extra care to pay off your obligations as fast as possible while you are in an extended program so the IRS does not charge further interests and penalties on your taxes.
- Installment Agreements
If you have hefty tax amounts to meet and even the extension of time limit did not help you much, then you can request that the IRS grants you an installment agreement. With an installment agreement, you can pay off your taxes in affordable installments. But the IRS will look into your financial situation before granting your request. Thereafter, the IRS will devise a payment plan to help you pay your taxes in installments. Installment agreements vary depending upon your tax amount and other requirements. Nonetheless, these plans are negotiable. But you are advised not to default while you are in the plan; otherwise, the IRS might cancel your plan.
- Offer-in-Compromise (OIC)
Offer-in-compromise is similar to normal debt settlement that you carry out with commercial creditors in order to clear away your debts. The only difference is that you make an Offer-in-Compromise to the IRS. It is basically a formal contract between the taxpayer and the IRS, where the taxpayer offers to pay the IRS as much as they can afford to clear the tax debts. When you make an OIC, the IRS will thoroughly review your financial standing and then accept, modify or reject your offer accordingly. Under this program, your tax debt is substantially reduced on the assumption that you will pay your taxes on time for the next five years.
Tax debt relief measures abound. But choosing the right option is extremely crucial and calls for the expert advice of an experience tax consultant. So, whenever you find yourself stranded in tax debt troubles, do seek help from an experienced and reputable tax consultant, who will not only help you choose the right tax debt relief option but also effectively handle the IRS on your behalf.
This article has been written by Angela Sanders. She is associated with Oak View Law Group, a trustworthy debt settlement firm.
One Response to “Smart Ways to Get IRS Tax Debt Relief”
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December 16th, 2010 at 2:20 am
There is no meaningful average. Tax refunds depend upon your tax liability, any credits that you may be entitled to, and how much tax was withheld.I would call the IRS and see if you can get some sort of payment plan set up to start paying back the taxes.The Tax Debt Settlement is based at Florida and is easily contactable for service.The most important part is the ability to put the desired plan into action after drafting the procedure of attorney tax settlement.