Debt is something that continues to loom overhead until it’s dealt with and gone for good. There are situations when people owe back taxes because they cannot afford the amount owed. For those of you that have faced this scenario or are facing it now, it’s less than ideal. However, there are financial resolutions available that you should consider when tackling your tax debt. This will help pave the way for a fresh financial start.
Consider an Offer In Compromise
An offer in compromise gives an individual the option to decrease debt for a better chance of repayment without facing a tax levy or wage garnishment. There is negotiation involved in this solution that could result in a more affordable amount that could be paid in one lump sum or divided over monthly payments to make it more affordable.
This type of payment arrangement can get you on the right track to paying off your tax debt and helping you jumpstart your finances for the future. Entering in to this type of an agreement is something you should seek a tax advisor’s help in order to resolve efficiently and effectively. Professional tax debt relief services have the experience and knowledge necessary to set up a payment plan for you and are well-versed in negotiating amounts with the IRS. Get offer in compromise help from professionals trained in these types of services to ensure you end up paying the least amount of money to the IRS.
A tax resolution service will be responsible for all communication with the IRS so that you can avoid a tax levy against your accounts and help reduce anxiety that may build from dealing directly with the government. This will help alleviate your financial stress caused by collection calls and notification letters. To put it simply, the IRS wants proof that you want to pay back your taxes and with the help of a professional, you can set up payments that are affordable to you and start on the path to financial freedom.
Know If You Qualify and Take Action
Before entering into any type of tax debt payment agreement, you’ll want to make sure that you meet all the qualifications and know the expectations surrounding it. It’s best to look into a payment solution as soon as possible rather than wait for years and years of back taxes to build up.
An offer in compromise gives you a chance for a new start, but you want to have other financial pieces put into place before moving forward. Ensure that you will be able to make payments as part of the plan and that you create a budget for yourself to keep on track with your spending.
Online budget resources like LearnVest or Mint.com are user-friendly for people just getting started with organizing their finances. Once you qualify, you’re not out of debt yet, but you have taken one big step forward into achieving that goal. Be proactive and change your financial situation around for the better.
Everyone deserves a fresh start and there are solutions available for those who need an extra boost. Take advantage of the financial resources around you and always make sure that you set yourself up for success.
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4 comments
A great suggestion for those that might be overwhelmed by debt.
My in-laws had to go into repayment with the IRS. My FIL cashed out his profit sharing when he left the company. Despite HR’s warning, he didn’t hold back 10%.
By the time I discovered this while I was doing their taxes, he was already laid off and his wife was waiting for disability. I was so upset with him, but he just shrugged it off when I asked why he hadn’t heeded the warnings.
It took them years to pay $7,000 on unemployment and disability. Some days I’m still pissed at him.
I just wanted to say that I am so happy I found your blog! I am roughly $38K in debt (damn student loans) and this is the first pf blog I’ve come across that I can relate to, is pretty to look at, isn’t overly preachy, the list goes on. And I just had to say THANKS! I’ve binged on all of your posts in the last week and I look forward to reading more 🙂 We can do it!
-Liz
That’s the sweetest comment ever, Liz! Thanks. We CAN and WILL do it. SO glad you are here. 🙂