Are you $10,000 or even more behind in taxes and do not feel that you can get ahead right now? You are not alone. With the economic pressures, job losses, the ever-tightening money situations, a lot of people who are in your shoes have to make a decision to pay Uncle Sam or keep their mortgage payments or food on the table. Not easy at all.
You should take care of ANY tax debt problem right away! Why?
Because the Internal Revenue Service can take strong actions against your property, earnings, and other assets to recover any funds from satisfying any tax debts that they may have against you.
Have you thought about settling your tax debts? Believe it or not, there are programs and conditions that the IRS has set to help those who are struggling and are having issues with back taxes. There are several different solutions, and not just any solution will help. You should consider discussing your situation with an IRS lawyer that understands your situation and can suggest the best routes to take in settling your tax debt.
One of the ways that you can help settle your tax liability is through negotiating with the Internal Revenue Service to set up an Installment Agreement Plan. Instead of having to try to knock out your back taxes in one lump sum, you can knock down your liability into smaller payments over time.
Let’s look into the Facts and Concerns of an IRS Installment Agreement:
Factoids:
- A method to consider if you cannot settle your tax liability in one lump sum, which a payment plan would be more attractive to your financial situation.
- You will be able to sleep better at night and be tax debt-free by the end of the plan when all payments have been made successfully.
- No more harassment from the Internal Revenue Service when your tax liability is satisfied.
Concerns:
- Just like with mortgages with making payments over time, you will accrue interest with paying your back taxes in installment terms.
- You will not just accrue interest, but any penalties if they apply.
- If you miss even one payment, in most cases, the installment agreement is annulled, and the IRS will have to explore other ways to tax debt collection, even possibly with the usage of levies.
- You have to be up to date with your tax returns and also declare every single asset that you own.
This is quite a brave process for the taxpayer as the payment plan will be judged with your total assets as a factor.
If you need help to decide that this is the right method to repay your tax liabilities, then a proper discussion with a tax settlement professional might be appropriate for the proper course of action. Maybe you need to instead file an Offer in Compromise if your financial situation is not looking that well. If you go with an OIC, you could pay your debt for pennies on the dollar, but also be aware that a successful OIC settlement will be placed on your credit report and could lower your FICO score.
