Tax debt can often feel overwhelming. That’s why this article will walk you through different tactics on how you can resolve your tax debt and find relief. Hundreds of thousands of Americans end up in debt with the IRS every year due to accumulated penalties and interests. However, you can avoid so many things, like increased debts, by paying off the penalties and interests. Your debt level can be overwhelming and sometimes can get out of hand. The following tips should help you resolve your tax debt to avoid penalties:
- File your taxes
Always ensure to file your returns even if you don’t pay. Failure to file your returns attracts many penalties that keep rising every day. If you don’t file by the deadline, you draw a monthly penalty of 5% of unpaid taxes. You can be penalized for not filing your details and considered a criminal.
- Make a payment plan
Sometimes the delay can happen, and you cannot pay the penalties and interests required by the IRS. If you cannot pay your taxes within the given timeframe, ensure that you request a payment plan. A long-term payment plan allows you to have a 120 day resolve period. Although the delayed payments will add interest and penalties to your debt, it is better than penalties accumulating over time. You can also divert your amount by temporarily proving to the IRS that paying your debt deprives you of basic living expenses. The IRS will buy that for a little while, but later they will come knocking on your door with accrued penalties and interests.
- Tap an expert for assistance
Experts know best regarding any debt issues. When tax debt accumulates and gets out of hand, it is essential to talk to an expert and get advised accordingly. When it comes to tax debt, always consult with a CPA to get the correct advice. An experienced attorney can help you get better terms, that is, if you owe more than $10,000. If your taxes are less than that, you can settle them yourself without incurring the cost of an attorney. However, be careful who you hire to help you in your debt settlement plan, as scamming is all over. If they claim to help you eliminate interest and penalties assessed by the IRS, they are probably lying. Do a background check on your attorney before hiring. Also, information is available on the websites, so get the correct information and compare the offers, rates, and interests.
- IRS debt forgiveness program
IRS allows taxpayers who owe a debt to reduce part of their debt according to living circumstances. If you plead with the government that you cannot pay your debt because you cannot afford living expenses, the IRS accesses the situation to determine who is eligible for the program and who is not. Although tax relief is sporadic, the IRS offers you a debt repayment program according to the magnitude of your debt.
Conclusion
You are not alone if you owe money to the IRS and are getting worried about your tax debt. You can check out the tax you owe IRS through phone, online, at an IRS office, or through the mail. With the options above, you can slowly pay your tax debt. Although with long-term repayment of the interests and penalties, you can still pay your tax debt within the given time frame.
It can seem almost impossible to clear when tax debt accumulates, but the IRS gives you the correct repayment method to clear your debt.
The IRS is assured that the person will still pay the debt no matter how long it takes by filing your taxes. What are you waiting for? Do not wait till your tax debt accumulates and you cannot pay. Check with the IRS today and start your tax repayment program today. Taxes are a way we contribute to the government to finance government activities, including public works and services such as roads and schools. By paying our taxes, we allow the government to be independent. Taxes are mandatory contributions collected by governments, so you can never run away from paying taxes. The more your taxes accrue, the more penalties and interests you get. You can pay your tax debt early to avoid fines and interests that accrue over time.
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