Income Tax Help How To Settle A Debt With The Irs - article about Income Tax Help How To Settle A Debt With The Irs

Income tax help — how to settle a debt with the IRS

Can you make a deal with the IRS? Yes, you can—the law encourages you to try. Here are some things to keep in mind if you need income tax help to settle a debt with the IRS:

* Many delinquent taxpayers are able to negotiate a very favorable deal. You might be able to pay off your back taxes, including interest and penalties, for less than fifteen cents on every dollar you owe. That means a $50,000 tax liability could be written off for no more than $7,500.

* The IRS won’t make such a favorable deal if they think they can get you to pay more by other means. The IRS uses a formula based on your net worth to determine how easily they’ll let you off the hook. How they arrive at a decision is beyond the scope of this brief article, so ask a tax advisor if you feel it’s in your best interest to make a compromise offer to the IRS.

* If you default on the terms of a tax settlement, the IRS has a legal right to terminate the agreement and seek payment of the entire amount originally owed in back taxes, interest, and penalties. When you make a deal with the IRS, follow through on the agreement. No amount of income tax help from the best advisor in the country will bail you out if you fail to keep your end of the deal.

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