Your Options When You Owe the IRS
You’ve done your taxes or worked with a professional to get your taxes done for the year, but you still owe. Whether you owe a little or a lot, you might feel disheartened, especially if you weren’t prepared for or expecting it. Thankfully, there are several options at your disposal in the event you owe and are not in the position to pay, whether partially or in full.
In working with the IRS, you may be able to reach an agreement that lets you pay in designated installments over a certain period of time. Instead of doing so through a lump sum.
If you’re dealing with a significant financial or economic hardship, the IRS may be willing to work with you to place you on “currently not collectible” status. The IRS will look at several different factors, such as your employment status, dependents, cost of living, and medical issues.
Penalty and Interest Removals
When you fail to pay owed taxes, the IRS will issue penalties. If they are not paid, penalties can accrue interest and additional penalties. Despite issuing penalties, the IRS also offers penalty and interest relief. They even have a first-time penalty abatement program.
Tax Lien and Wage Garnishment Prevention
This one is more in the hands of the taxpayer. It’s all about being proactive and being willing and able to work with the IRS. Ignoring IRS letters can put you on the path to penalties and liens. Always open those letters and if you need help, seek that help. You can do so through the IRS or with a tax professional.
Here are a few more options. If you owe $10K or less, you can get help today by going through our “Owe $10K or Less” course. If you owe over $10K, click here to find free guidance. Finally, taxpayers with IRS back taxes can also learn how to get a fresh start here.