Every year individuals and businesses
alike find themselves in what feels like shark infested waters, that is,
owing back taxes to the IRS. Of course if you owe a few thousand dollars
and you can afford to pay them in full, then that's exactly what you
should do. But what if you owe over $10,000 and can barely get by each
month? It's for these people that obtaining an IRS debt settlement
should be a goal. The first thing you need to do is determine whether
all of your taxes have been filed. The reason for this, is that the IRS
requires all your taxes to be filed prior to negotiating a tax
settlement with you. You then need to start asking yourself question,
such as why it is that you owe these taxes in the first place. Have you
been charged penalties and interest? Did the IRS file taxes on your
behalf, which caused you to owe more than you really should have? Do you
have any kind of hardship that may assist with your negotiation? Have
you received a Levy Notice? These are all crucial questions which when
answered will let you know your options with regards to IRS debt
settlement.Do keep in mind that
under the TBOR law, you have the right to have a firm represent your
case to the IRS to negotiate an IRS debt settlement if you owe IRS back
taxes. But what are the odds that you'll qualify, and for which program?
There is no good answer to this as everyone is different. Some people
may qualify for a large debt reduction program while others will not.
Sometimes a formal Offer In Compromise is the best solution, if it is
accepted. However often times an experienced Tax Professional can
negotiate your IRS Debt over the phone with the IRS Agent and settle
your tax debt for much less than you owe without having to go through
the long term process of waiting for an Offer In Compromise solution.
As mentioned above, everyone has a
different need and so different measures may be taken. Some of the steps
required toward IRS debt settlement may consist of the following:
1. Filing a Power of Attorney
2. Taking action to stop a Wage Garnishment or Levy
3. Preparing any un-filed taxes (This can be time consuming if you have
many years of un-filed taxes and have no records.)
4. Pulling a master tax record to determine exact amount owed
5. Preparing your financial worksheet and determining your monthly
surplus.
6. Determining the penalties & interest charged.
7. Filing possible appeals based on TBOR legislation.
8. Filing for Penalty Abatement
9. Determining whether you qualify for Innocent Spouse, Offer In
Compromise, CNC Status, Payment Plan, etc. and combinations of those
options.
10. Preparing the documents and filing.
11. Negotiate with the proper Agent at the IRS that has the authority to
make decisions and reduce your tax liability.
12. Follow up with all paperwork and phone calls promptly with the IRS
Agents that are handling the case.
Certain filings have required IRS fees.
However, you may qualify to have those fees waived. If you have
experience with tax preparation, that may help you with settling your
taxes because at least you'll understand the basics of taxes, although
not the legalities of course. If it's all mumbo jumbo to you however,
you may seriously want to consider hiring an IRS Tax Representation Firm
that does this for a living. IRS debt settlement, and for that matter,
resolving back taxes in general, can be a lengthy process, where one
mistake could cost you everything.
IRS debt settlement is serious
business. But don't make the mistake of thinking you have no options for
tax relief. Also, don't fall into the trap that your only option is an
Offer In Compromise. That is not true for most people. There are
numerous options and combinations of options available, but again you
need to do your homework.
