Not everything is what it seems, and there’s a lot of options out there that are available but not always possible because there are rules for each scenario. Here are five such avenues.
Tax Debt Under $50,000.00
For unpaid balances of less than $50,000 which include interest and penalties, there’s a streamlined installment agreement option which will allow you to pay off the balance over a period of 72 months. Although interest on the balance of your debt will accumulate until the debt has been completed.
Offer In Compromise
This option has greater challenges in that it looks at: your ability to pay, income, expenses, and asset equity. Offer In Compromise Booklet reviews the various areas of what is involved with the program, and the OIC Prequalifier is an interactive online tool which can determine your eligibility provided by the IRS.
Currently Not Collectible Status
There are situations for which you cannot pay back the IRS for various reasons because you can’t pay your taxes and have reasonable expenses, thus the IRS Taxpayers Advocate Office has a Currently-Not-Collectible page for you to look at what’s possible to consider if you’re facing a mountain of debt and don’t have the capabilities of moving forward until your tax situation has been resolved.
Innocent Spouse Tax Relief
In the situation to where a spouse or former spouse failed to properly report items or omitted on your tax return, a person does have the option of doing this request for relief to avoid to where the spouse in question is the one responsible for the tax, interest and penalties. The IRS has a very specific set of rules and it focuses on how much knowledge of the situation the spouse applying for the Innocent-Spouse-Relief option.
Expiration of the Statute of Limitations
Everything has an expiration date, and the IRS is no different when it comes to collecting back taxes from taxpayers, which is generally 10 years. However, this is more challenging when you understand that there’s no deadline if the IRS determines that the taxpayer has filed a false tax return willingly, failing to file tax return(s), as well as working to avoid in paying taxes. Not the most ideal option to pursue, however it is an avenue that some people do choose.
Again, not every option is right for every person when they’re in trouble with the IRS, but there are options out there to help taxpayers who get into some trouble and need a helping hand.
Dwayne J. Briscoe