Can a Tax Cut Impact Your Debt to the IRS?
It is all over the news! Lawmakers are working to pass tax cuts in the coming months and we all are wondering how this may impact our bottom line. Specifically, you may be wondering if a tax cut could impact the debt that you owe to the Internal Revenue Service (IRS). Here is some information that may help you estimate the impact potential tax cuts may have on you personally.
Implications of Potential Tax Cuts
- What you already owe the IRS is not likely to change substantially based on upcoming tax cuts. Your tax debt itself will remain virtually unchanged no matter what tax cuts are put into law in the coming months/years. Interest and penalties may change slightly going forward but if you are waiting to see if a future tax cut that will reduce your back tax debt, you will likely be disappointed.
- Pay your tax debt as soon as possible. Waiting on a political decision will not pay off when it comes to back taxes. You should always pay as much of your tax debt off as soon as possible to avoid paying unnecessary penalties and interest. This only adds up quite quickly and make your problem much worse, not better. If you are not able to pay your taxes on time, it’s important to go ahead and file a return and work on a plan to pay as soon as you are able.
- You are much more likely to be able to negotiate with the IRS the sooner you make contact with them. There are various programs that you might be able to take advantage of, including an installment agreement that allows you to pay your debt over time rather than in a large lump sum, or an Offer in Compromise, an agreement that allows you to settle your debt for less than you actually owe.
- The proposed tax cuts are expected to have the most significant impact for big businesses and corporations. In fact, it is possible that the middle class will actually see a rise in things like their taxes and the interest rate. Keep in mind as well that, to date, this tax legislation has not been passed, so you should keep your eye out for what actually passes in the coming months.
- Get tax support if you need it. If you owe the IRS back taxes, your best bet is to get assistance and guidance from a reputable tax firm sooner rather than later so that you can come up with a reasonable plan to pay off your tax debt. You can seek guidance about whether you might qualify for an installment agreement or an offer in compromise and learn exactly what you need to submit to have the best possible chance at taking control over your tax debt once and for all.
Reach Out to Success Tax Relief Today for Help With Back Taxes
Success Tax Relief has worked with thousands of Americans who are struggling to find a way out of tax debt. We stay current on all current tax law and keep our eyes on any and all proposed tax cuts. Our team can help you come up with a plan to work with the IRS to pay down your current debt. Call us at 877-825-1179 or contact us online for more information.