How to Successfully Get Out of Tax Debt in 1 Year!
If you realize that you owe a significant amount of money to the Internal Revenue Service (IRS) this year, your attention may quickly turn to how into getting out of debt as quickly as possible. Thinking ahead and developing a specific plan about how you will settle your debt to the IRS is an important first step. Owing money to the IRS can be stressful as the IRS has the power to garnish wages and/or seize property in order to make sure that the debt is paid.
Here are some tips for successfully getting out of your tax debt quickly in as little as one year:
- Request an installment agreement: An installment agreement can allow you to pay your tax debt to the IRS in monthly installments over a period of time. This gives taxpayers more time to pay, rather than requiring a lump sum payment.
- Apply for an offer in compromise: In some cases, a taxpayer may be able to settle their tax debt for less than the full amount they owe. This is ideal for those whose tax debt exceeds what they can actually afford to pay. If you qualify, you will be able to make a lump sum payment or short-term payment plan.
- Consider an alternate payment method: If you owe a large sum of money to the IRS, it may be wise to think of other sources of payment. A personal loan from a bank, opening a credit card at a low interest rate, or even asking for a loan from a family member can be a way to pay the debt to the IRS and eliminate the risk of wage garnishment and/or seizure of property.
- Declare yourself currently not collectable: There are instances in which you may be unable to pay your debt for a period of time. This can stop the IRS from pursuing things like wage garnishment or seizing property.
- File bankruptcy: Filing bankruptcy is something to consider in some rare cases when your tax debt is eligible for discharge (either via Chapter 7 or Chapter 13).
- Watch the expiration date for the statute of limitations: The IRS has a maximum of 10 years from the date of assessment to collect all taxes, penalties and interest from you. So, if this period of time passes, you are not required to pay back your debt. Generally, the IRS does not “forget” about outstanding tax debt, but it can happen.
If you anticipate that you will owe the IRS a chunk of money this year, or already owe from a previous tax return, you may benefit from working with a tax firm to strategize the best way to handle your debt. Success Tax Relief is a full service tax firm that can help you with routine tax prep, audit support as well as helping clients apply for installment agreements, an offer in compromise or declaring yourself not collectable. Our team can communicate directly with the IRS on your behalf, to take away much of the stress and worry. Call Success Tax Relief at 877-825-1179, or email us to get started.