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The Way to Handle Your Tax Debt that Nobody Will Tell You About

Posted by rafael on December 15, 2012 in Business Finance

If you’re in serious tax debt, you may think there’s no way out from under the weight of this problem.  If the IRS is already breathing down your neck for back taxes and the amount you owe is so high that you know you could never afford it, tax debt relief is not out of the question.  Even if the IRS has already put liens on your property, you’re not beyond help.  There are options, though you’ve probably never been told this information.

People don’t talk about tax debt as a topic of conversation.  It’s embarrassing if you’ve dealt with it personally, so it’s not information that will come up casually.  Unless you have friends who are IRS employees or tax professionals in your family, chances are you don’t know anyone who is familiar with the details of how taxes and tax problems really work.  And if you’re in serious tax debt, the IRS isn’t going to tell you that you have an option for compromise, but you do.

Your Tax Debt

Your Tax Debt

Offer In Compromise

The IRS has a program called the Offer in Compromise program, which allows taxpayers who are in serious debt to get a clean slate and start fresh.  The idea is simple – if you didn’t pay your taxes because you don’t agree you owed them in the first place and you don’t have the ability to pay them now, this program allows you and the IRS to agree upon a small amount of what you owe as a full settlement, and to be considered paid in full.  If you owe an amount you know you’ll never be able to pay, this is the option for you.

Though the idea behind the Offer in Compromise program for tax debt relief is simple, the process can be complex and you’ll want to hire a professional to assist you and make sure you’re given a fair deal to get your taxes paid off.  The process includes a detailed look at information about whether or not you are able to pay the amount you owe, how much the IRS could collect from your assets, what they would be able to collect from garnishing your wages currently (and in the future), and money that you have available to you from sources that the IRS does not have the ability to seize from you.  You also must have certain information in order to use this option, including having all your tax returns filed, disclosing all your assets, and meeting the eligibility criteria.  A professional will be able to handle the details and make sure you and the IRS are able to agree on an amount that is fair to you, while still satisfying them to consider you paid in full and finally taking the weight off your shoulders.

Not a Solicitation for Legal Services.

Featured images:
  •  License: Royalty Free or iStock source: http://office.microsoft.com/en-us/images/results.aspx?qu=tax&ex=1#ai:MP900308880|

Eric Regan is a member of a writing team who have written for many different news sites and blogs all over the internet. Follow him @Eric_Regan.

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