Possible Tax Resolution Strategies to Ease Your Mind If You Owe Money to the IRS

05 May Possible Tax Resolution Strategies to Ease Your Mind If You Owe Money to the IRS

For honest taxpayers, receiving a letter from the IRS can be extremely daunting. Unlike most other government agencies, the IRS has the power to attack your wages, freeze your bank account, and even confiscate your property, which is enough to send shivers down any taxpayer’s spine.

However, if you receive a letter from the IRS stating that you owe additional taxes, it’s essential not to panic. While it may be a daunting situation, you can settle your tax debt and get back on the good side of the IRS by taking certain steps.

Below are three strategies you can use to resolve your tax debt and keep your peace of mind. Not all of these options will be suitable for everyone, but knowing what they are can help you set your mind at ease. The IRS can be intimidating, but they can be reasonable if you know what to say and how to approach the situation.

Review the Amount Owed and Your Tax Return in Question

If the IRS says you owe money, don’t assume they are correct. The tax agency makes mistakes, and so do taxpayers and tax preparers.

Whether you filed your taxes on your own or hired someone else to do it for you, it’s crucial to examine your return and compare what you find with what the IRS is claiming and it’s advisable to seek professional assistance for this tax review. A professional with IRS experience may be able to uncover errors and inconsistencies that you would have missed on your own, which could save you money. Many taxpayers who believe they owe money to the IRS can end up owing nothing or even receive a refund from the agency.

Set Up a Payment Plan

The IRS is frequently willing to work with taxpayers and set up payment plans, which could make paying what you owe more manageable and less stressful. Once again, it’s a good idea to seek professional assistance and guidance here. The IRS can drive a hard bargain, and if you do not know what you’re doing, you could end up with a payment plan you can’t afford or pay your full balance over time when you could have actually paid less.

If you fall behind on the payment plan you agreed to, the IRS may take further enforcement action, including garnishing your paycheck or freezing your bank accounts. Seeking the assistance of a tax resolution professional upfront can help you avoid these serious consequences.

Explore an Offer in Compromise Settlement

If you genuinely can’t pay the amount the IRS claims you owe or if doing so would create an economic hardship, you may be able to negotiate a settlement for less than what you owe. The IRS may not advertise this program, but the tax agency is often willing to work with taxpayers by accepting smaller amounts, particularly if those taxpayers have few assets, limited income, or extenuating circumstances. Sometimes, an Offer in Compromise can be for a fraction of what’s owed if you qualify. We offer a free no-obligation consultation to determine whether you qualify at www.BenefitTaxAdvisors.com.

If you plan to pursue this last option, it’s crucial to work with a tax resolution expert. These compromise offers can be incredibly complex, with legal language and terms that can be difficult to comprehend. You don’t want to make a mistake here, and you want to ensure that paying the compromise account will result in a complete settlement of your tax bill.