Many people need more clarity about tax debt and how to manage it. They need financial advisors and accountants to get rid of unwanted trouble. However, some people believe they can take care of it independently. It’s a mistake. The Internal Revenue Service (IRS) also wants to settle debts to ensure compliance in the future. If you present your case well, they can accept your request for settlement. Here are a few insights regarding this to make your decision easy.
IRS supports you
According to some provisions, a debtor can get approval for installment payments for their liability. It can be relevant for 72-82 months. It shows that the IRS is also willing to help taxpayers. The agency doesn’t take strict actions like seizing assets, levying restrictions on bank accounts, etc., unless they don’t have any other ways to collect tax. If you work with them on this, you can save yourself from extreme actions.
Again, this can be possible to achieve with expert guidance. Someone like E.A. Buck Accounting & Tax Services can look into your concerns and help you navigate the entire process systematically. More precisely, they can support you with payment planning, penalties reduction, and tax liens relief.
There was a reason. Generally, taxpayers can expect some relief under IRS’s first-time penalty abatement (‘FTA’) rules, which apply when your last three tax periods are transparent with you complying with all the laws and regulations. Other than this, one can also apply for reasonable cause penalty abatement, which indicates that a taxpayer didn’t neglect their payment intentionally. The department can reject the application, but your tax resolution expert can appeal again.
Communication delay is a risk
You need to make time to engage with the government agency. Hence, going alone can be risky because a prolonged wait may not yield desirable results. When you hire a tax resolution expert, you don’t have to worry about anything. They know how to communicate with them and who is the right person. After all, dealing with delinquent taxpayers is a headache for the agency. If you don’t act on time, it will only increase your risk of penalties with debts accumulating more interest charges. It can even compel them to take aggressive action. That’s why it’s better to start the settlement process quickly.
Everyone knows that they should pay the entire tax amount on time. But some circumstances can expose you to penalties and high-interest charges, affecting your monthly payments for unpaid tax. As said, settlement options are available whereby you can get approval for paying less than the actual amount. The term for this process is offer in compromise. The complex method requires form filing and submission of various documents. Then, you may need to find out if the due amount against your account is correct. If you believe this knowledge is enough, it is a mistake. You may need clarification about it. Or, the department may wonder if you can still pay the settled amount. You can avoid all these issues or hurdles if you have an expert specializing in tax resolution. They will help you put your best foot forward.