5 Programs To Help Solve Your Tax Debt

5 Programs To Help Solve Your Tax Debt

There are many solutions or a combination of solutions to your tax debt problem. The key to solving your problem is to learn about the various programs and to use the correct program or combination of programs to help solve your problems

A. Tax Abatement programs

These programs let taxpayers pay a reduced amount in full and final settlement of their tax liability. They work well when there are doubts as to whether or not the taxpayer owes the debt, or if the IRS will be able to collect it. Some of these programs allow for a lump sum payment, while others allow for payment plans.

B. Affordable payment plans

With these programs, taxpayers pay the full amount due, but can make payments over as long as 60 months. The IRS considers the taxpayer’s ability to pay when setting the terms of the payments. If taxpayers have equity in an asset, they can use the net realizable equity to pay down their tax liability. In other cases the IRS will agree to subordinate their lien to help taxpayers sell or refinance their way out of their tax debt.

C. Deferral programs

These programs let taxpayers defer their tax payments. The taxes may be uncollectable, or the taxpayers can get more time to pay their taxes.

D. Penalty Abatement programs

Under these programs, if the taxpayer provides the IRS with good cause, they may reduce or eliminate penalties charged on back taxes.

E. Tax Expiration Programs

If the tax collection statute of limitations has run, or if your business is defunct, you may be able to have the IRS waive income taxes.

These programs may not apply to you, but you, and your tax preparer should do the research to see if they apply in your situation.