How Do I Do a Tax Debt Settlement?
So how do I do a Tax Debt Settlement?
Tax debt relief is a term that refers to measures that can be taken in order to get rid of debt that results from unpaid taxes. Settling those debts is complicated process, especially since you have to keep paying taxes evey year. There is no way you can erase your debt completely, but there are several things you can do to make the repayment process easier and manageable.
As long as you follow the rules and pay everything on time, you should eventually be able to get rid of your debt. Getting the paperwork in order before you send out to repay your taxes, you need to get a sense of what you will be facing.
Find all your tax forms and organise everything. Once that’s finished, there are several things you can do in order to get tax debt relief.
Installment Agreement
This is a payment plan that allows you to pay off your debt in monthly portion (the installments). When you agree to monthly intallments, you agree to pay a certain amount evey month. That amount is equal to the total value of your debt divided by thirty. You must be able to pay off the total debt over a thirty-six months period that starts when you sign the installments agreements. In order to qualify for the installment agreement, you must meet several requirments.
They include : No other obligations-all your taxes must be filled and you can’t have another installment agreement. Generally good record-if you filled your tax forms late and paid your taxes late anytime during the five years prior to the most recent tax year, you would not be qualified for an installment agreement.
Offer In Comprise
This is a program, where you agree to repay a portion of your debt. The rest will be forgiven. In order to qualify, you must prove to the IRS that you either don’t have the money to pay off all the debt.
Not Currently Collectiable Under this program, the IRS agrees not to collect on your tax debt fo a year due to your financial hardship. You can apply for it by filling Form-433-F. This won’t reduce you debt, but if does give you time to find some way to repay it.
Hiring a tax professional
If you owe IRS over $125,000,you should consider hiring an experienced tax professional. A tax professional will use his or her expertise to help you through any and all of the tax relief programs listed above. A tax profesional must be a licensed as either a Certified Public Accountant or an Enrolled Agent or tax attorney.
