I was recently involved in a car accident. Unfortunately, since it was my first accident, I was scatter-brained and anxious. What I did not realize at the time was that the actions you take immediately after the accident can affect a personal injury case and the outcome of that case. I wanted to find a way to share my experiences and mistakes with other. Since the Internet is so popular, I figured this would be a great way to do so. While you likely aren't planning on being in an accident soon, if you are, hopefully you remember some of the tips I share on this website.
Do you owe back taxes to the IRS? If so, you know just how stressful and challenging the situation can be. Depending on how much you owe, the IRS may use aggressive collection strategies against you. If you owe a small amount, you may be receiving certified mail or even constant phone calls. If your overdue balance is significant, the IRS may be threatening wage garnishment, account seizures, or other strong tactics. Those are likely outcomes you don't want to face. The good news is you have options available. Below are three such strategies to help you manage your overdue tax balance:
Set up an online payment agreement
The IRS likely wants to collect from you any way they can, but preferably in as convenient a manner as possible. They'd like to avoid seizing your accounts or garnishing your wages if possible. That means they'll likely be open to setting up a payment arrangement over a year or even several years. You can do this by calling the IRS and simply asking about the availability of such an arrangement. If you owe a significant amount of money, you may benefit from a tax attorney working on your behalf, as lower level IRS service associates may not have the authority to set up a payment agreement on large balances. Also, if you already have one payment arrangement outstanding, the IRS may be hesitant to open another one.
Use offer in compromise
Another option is to try and settle with the IRS through an offer in compromise. An offer in compromise is an agreement in which the IRS agrees to accept an amount less than the total balance due. In exchange, you agree to pay the compromise amount immediately and in one lump sum. This may be appealing if you can pay some portion of the bill, but not the total. However, keep in mind that the IRS is likely to only accept this strategy if they believe it is unlikely they will ever collect in any other method. If you have significant assets, an offer in compromise may be rejected by the IRS.
Raise assets wherever you can to pay as much as possible
If you can't set up a payment arrangement and the IRS won't agree to an offer in compromise, your best option may be to try and pay as much as possible to at least get some breathing room and delay IRS collections. Consider borrowing from friends and family, using credit cards, taking loans from other sources, or even selling assets to raise money. Often, if you can make a substantial payment, that's at least enough to halt collections and allow you to figure out a long-term strategy. Again, a tax attorney can help you figure out how much to pay and possibly even how to raise funds.
For more information, contact a tax attorney in your area. They can help you analyze your tax situation and develop a strategy to put your tax debt behind you. Find a tax attorney near you (like Dermot F Kennedy) to start the conversation.