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Are you recently unemployed and worried about tax debts? Those are intelligent concerns to have! Failing to pay taxes is a serious crime that can lead to jail time, but you don’t want to go to jail for something you can’t afford.
Curious about how you can protect yourself and your tax situation? This article will explain how the negotiation process works with the IRS and how you can get help when you can’t pay.
Let’s explore what to do when you can’t pay taxes. Read along to learn more!
Hire an Attorney
The first step to hiring an attorney to negotiate your tax debt with the IRS is to ensure that your attorney is well-versed in tax law and has arranged similar cases. Ask for references and look for a lawyer who has experience dealing with the IRS. After finding the right attorney for your case, the next step is to discuss the terms of the negotiation.
It includes the size of your debt, how much you are willing to pay, and the timeline for repayment. Your attorney will then put together a negotiation proposal and submit it to the IRS on your behalf. Your attorney can negotiate a payment plan, an Offer in Compromise, or dismiss your debt.
Keep in touch with your attorney throughout the process to ensure that you follow all necessary steps. Having an attorney by your side can make all the difference in negotiating your tax debt with the IRS.
Calculate the Total Amount of Tax Due
This amount is on your income tax return from the current and prior tax years. After you have calculated the amount of your tax liability, you must add any penalties and interest that have accrued since the assessment date. Once you have the total amount of tax due, you can use this information to negotiate a payment plan with the IRS.
Remember that the IRS has the right to accept payments in whole or in part, so be sure to negotiate a payment plan agreeable to both parties. Additionally, the IRS may need extra information before they accept your negotiated payment. Finally, keep copies of all paperwork and communications between you and the IRS.
Be Aware of IRS Regulations
Knowing the IRS’s rules and laws can be essential in working out a payment plan for any owed taxes. Familiarizing yourself with IRS regulations such as the Streamlined Installment Agreement (SIA) and the Offer in Compromise (OIC) or tax debt compromise program can help you to see which payment plans are best for you. Additionally, knowing the criteria for various payment plans and the possible consequences for not following IRS regulations give you an advantage when successfully negotiating your debt with the IRS.
Lower Your Tax Debt Today
Negotiating your debt with the IRS is possible, but you must meet some qualifications. You may qualify for different payment plans or have your debt reduced, but only if you meet the necessary qualifications. Contact us today to learn more about your options if you’re struggling with tax debt.
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