When it comes to collecting debt, the IRS has a whole arsenal at its disposal to use against you – levy your assets, place a lien on your income, and various other means including piercing the shroud of corporate anonymity. But what options do you have at your disposal for tax debt relief? Perhaps more than you would imagine, as you can see below.
Installment Agreement with IRS
One good option to consider is to set up an installment agreement with the IRS. This is a monthly payment plan and it allows you to work directly with IRS to settle up your payments over a period of time. Do note that if you think you are a victim of a fraudulent investment scheme (“Ponzi” scheme), where you lost most or all of your investment, you may be eligible to recoup 30 to 40 per cent of your losses. This is a highly technical and complex process but it can help you reduce previously paid taxes, resulting in refunds with interest for you.
Offer In Compromise
This is a popular option for taxpayers who have been given a huge debt they are unable to pay. With this scheme, you can settle your tax debt for far less than what is owed. It requires a lump sum or short term payment plan, but ultimately can save you thousands of dollars in taxes, penalties and interest. Some of the most successful tax settlements have been via this method.
Credit Card Debt Settlement
Paying off your tax debt by credit card is a fast and convenient method especially if your debt amount is low. If your credit limit is lower than the amount due, you can still use the credit card payment to lower your overall debt, making it easier to pay off the balance. Try to avoid damaging your credit limit with non-payments or it will hurt your ability to use your card in future.
Currently Not Collectible
This is a program where the IRS agrees not to collect the debt for about a year, because the taxpayer has declared themselves to have no ability to pay his or her tax debts. This requires evidence of their finances to be submitted to the IRS. This is useful to file for a collection appeal and stop the IRS from issuing a levy, lien, seizure of assets, or denial or termination of an installment agreement.
Seek Professional Representation
Often, getting a professional to represent you in your tax debt relief can open up more opportunities for you to ease the burden of tax payment. Tax attorneys with good relationships and open communication channels with the IRS have been known to negotiate much lower settlements than owed, persuade the IRS to not freeze taxpayers’ assets, and suggest other avenues which would help the taxpayer with repaying the debt. Tax Defense Partners have years of experience doing just this kind of work, with over 1,000 successfully closed cases. Contact us today to find out more.