Critical Errors to Avoid: 7 Mistakes of Tax Relief
The IRS is contacting you, they’ve sent letters and called. The paperwork is piling up and you get further and further behind. You have no idea what to do or where to turn. You feel stressed, overwhelmed and confused, so it’s very easy to make critical errors.
This is the exact situation so many individual and business taxpayers find themselves in when they have tax problems. When you owe taxes, it can be a very frustrating situation and you often feel desperate for relief. It’s in times like these that is very easy and common to make a mistake. However, unfortunately, those critical errors can often be costly and timely. If you’ve failed to pay taxes and you’re seeking relief, it’s important to avoid the following critical errors.
1. Believing the Problem Will Disappear
The IRS isn’t going away. You are one of millions who owe taxes within the United States; however, the IRS will not forget about you or the taxes you owe. They may temporarily delay contacting you, which could lead you to believe they are finished with your case but they aren’t. The IRS is a huge organization with a high volume of complex tax related issues. Their employees are highly competent and capable. Although the IRS may be slow at contacting you or responding to your case, eventually they will get to you.
2. Letting Your Emotions Take Control
As we mentioned previously, when you’re in tax debt, the situation can be extremely overwhelming and stressful. Unfortunately, there are deceitful companies who prey on individuals in these situations. These debt relief scams contact desperate individuals and promise they can achieve unrealistic results such as:
- Settling your debt for “pennies on the dollar”
- “One-time offer” to settle your debt
- Become tax debt free
- Reduce your tax debt in 5 minutes
Do any of these sound familiar? Unfortunately, to those in desperate situations seeking relief, these offers can be tempting. Do not make the mistake of falling for a scam. If you find yourself in a situation and a company is offering you relief, do your research on the company. Choose a tax debt relief service with professional credentials, customer and Better Business Bureau reviews and realistic options. As difficult as it may be, separate out your emotions to make sound decisions regarding debt relief.
3. Assuming You’re Eligible for Debt Relief Programs
The IRS does offer a variety of a relief programs for eligible individuals. These plans include the IRS Fresh Start Program, IRS Offer-in-Compromise and Installment Agreements, among others. Many individuals believe that if they are in need of tax relief, they will automatically qualify for one of the programs the IRS offers. However, as daunting and confusing as understanding taxes can be, so too can the requirements of the IRS relief programs.
Taxpayers with back taxes can qualify for relief by meeting certain rules and procedures set forth by the IRS and Tax Code. Some forms of relief can be obtained by properly communicating with the IRS in a timely manner, others can be achieved by filing timely appeals and other forms rely heavily on a full understanding of the IRS policies and procedures and tax law.
If you think you’re eligible for a debt relief program, you should strongly consider working with a tax relief professional. Relief companies are comprised of former IRS collectors and auditors are well as current tax resolution specialists. They’ve handled thousands of cases and they know all the details of relief programs. Debt relief companies will help you determine what programs you’re eligible for and how to apply.
4. Settling for A Costly Installment Agreement
One debt relief program that may be available to you is an installment agreement. An installment agreement is an agreement between the IRS and the taxpayer to pay down existing debt in smaller, more manageable amounts over time. It’s important to note that not everyone is eligible for an installment plan. You must be in compliance with certain tax obligations such as filing, federal tax deposits and withholding before an agreement can be established.
Installment agreements can be great options; however, you should not settle immediately when given a proposed agreement. Less expensive options may be available. Do proper research or work with a professional to determine if there are any alternative solutions. The last thing you want to do is agree to pay an amount that is too costly and will result in financial stress in other areas.
5. Failing to Cooperate with a Tax Resolution Specialist
If you elect to work with a tax resolution specialist, they will take over a significant portion of the work. They will not only determine what the best option for your situation is, they will also take over all communication with the IRS and State authorities to ensure your assets are protected and your rights are upheld.
However, in order to resolve your tax issue, it is imperative that you cooperate with the tax resolution specialist. You will need to be completely candid with them and share all the information and documentation about your current situation. If and when they request information from you, it’s imperative that you cooperate. Together, you will work to resolve your tax debt.
6. Disregarding The Bigger Picture
When you owe the IRS or State taxes, it can be a very consuming process. However, it’s important to remain focused on the bigger picture. When you work with a tax relief professional, they will help determine what the best possible outcome for your tax situation is. They will then develop a strategy to resolve your tax issues.
Once you’ve gone through the process of owing tax debt, it’s something we’re certain you won’t want to revisit. Therefore, it is important for you to look at the bigger picture. Review your finances and create a comprehensive plan to get back on track. You may need to simply follow a budget or you may need much larger financial planning. Either way, create a plan so that you don’t owe back taxes in the future.
7. Choosing the Wrong Debt Relief Company
Unfortunately, many taxpayers select a relief service without doing the proper research. When you’re selecting a debt relief company, choose a company who:
- Gets Real Results: Select a company who routinely saves clients thousands of dollars and who can prove it.
- Has Experience: Choose a company that is comprised of seasoned tax professionals including Enrolled Agents, and/or Former IRS Agents.
- Focuses on Personalized Service: Work with a company that will personally handle your case from beginning to end, with no exceptions.
- Cares: Find a company who will genuinely care about your situation and will be proactive in resolving your issue.
Not only are we licensed Tax Relief Specialists we are also former Senior IRS Agents that now serve the best interests of taxpayers like you – all we do is handle IRS Tax Relief matters, all day every day.
Learn how we can help with your tax matter. Visit our Help Menu today for immediate assistance from our Licensed Enrolled Agents and former IRS Collectors. We look forward to serving you!