Having an insurmountable tax liability with the IRS or other state agency can be a stressful experience. While this may have evolved for a variety of reasons, it is important to know that once it is assessed it should be addressed as soon as possible. There are various options for handling IRS collection issues, which are frequently based on the individual taxpayer’s financial situation.
EXPLORING OPTIONS TO RESOLVE YOUR TAX DEBT
Though the IRS can easily garnish your paycheck or place a lien on your property, you can prevent these actions by electing one of several options. Paying off the entire amount due is inevitably the most attractive option to the IRS. The agency is aware that this is an unrealistic solution for many people. Some families live paycheck to paycheck and have very little disposable income available. Others may be on the verge of retirement with little expectation of generating future income. Individuals with bad credit and massive debt may be considering bankruptcy while individuals with good credit may have available funds but not enough to pay off their tax debt. Many individuals encounter situations such as these and are not sure what to do.
Please know that you have several options available to you based on your current and future financial situation. It is important that you select a competent tax accountant or tax attorney who understands these options, allowing you the softest landing when dealing with the IRS. If you are low-income, you may qualify for free tax representation services at a low-income taxpayer clinic. (Please see our resources page to find a clinic near you.) Whoever you decide to use, please remember that strategy and planning are essential when considering one of the these options. For example, the IRS has ten years to collect your tax debt so if you are at the end of the statute, you may not want to submit an Offer in Compromise, which will extend the collection date.
For more information on your options, please contact TaxFirm.com at 732-244-4500.