Do you owe more in taxes this year than you anticipated? If you are unable to pay your balance in full by the tax deadline, it can be a very stressful and scary feeling. You wonder if the IRS will seize your bank account or your home. The good news is that there are options out there for you! The IRS has different payment plans and options for taxpayers depending on your income and your financial situation. The important thing is to be proactive and trying to find a payment arrangement with the IRS as soon as possible. The IRS can penalize you if you do not pay your taxes by issuing a failure to pay penalty.
The IRS allows for installment agreements to pay your balance over multiple months. If you are able to pay your balance this way, you may also qualify for a penalty abatement as you will receive a penalty for not paying your taxes in full by the April deadline. Before entering an installment agreement, make sure you can pay that set amount each month, otherwise you can default and cause more penalties and problems for you.
Depending on your current financial situation, you may qualify for a resolution where you would not pay the full balance owed. Those options include currently not collectible status, a partial pay installment agreement, or an offer in compromise. The IRS requires proof of your current financial situation to place you in any of these resolutions. If you qualify for currently not collectible status, this means that you do not pay anything towards your balance! If you qualify for a partial pay installment agreement, you will pay a portion of the balance due but not the full amount. Keep in mind, that there are instances where currently not collectible status and the partial pay installment agreement can be reviewed, and you potentially taken out of. Finally, if you qualify for an offer in compromise, the IRS will settle for only a fraction of your balance! If you are having trouble getting the IRS to agree to a resolution, you may want to hire a tax attorney to help negotiate the resolution with the IRS. They can also help provide substantiation and argue on your behalf for certain expenses. With that, be very mindful when picking a tax attorney. There are plenty of businesses promising miracle fixes to even the most severe tax problems. Be intensely skeptical of these. Make sure to thoroughly research anyone you consider working with before enlisting their services. And remember, if an offer sounds too good to be true, it probably is.
If you need help paying current taxes you owe, or taxes from previous years, Polston Tax can help! Our team of tax attorneys can advocate on your behalf for the IRS and help you get into an affordable resolution. Call us today at 844-841-9857 or click below to schedule your free consultation.