When You Can't Pay Your Taxes

FinanceTax

  • Author Tommy Brown
  • Published November 22, 2010
  • Word count 450

Many people find themselves in the unenviable position of being unable to pay their taxes and having the Internal Revenue Service as a creditor. There are a lot of reasons for this, including the loss of a job, failure of the self-employed to make estimated tax payments, premature retirement plan distributions, under-withholding, or changes to the individual's filing status or exemption qualifications.

Even if you can't pay your taxes, you must file your taxes. You may want to enlist the services of an Enrolled Agent as soon as it comes to your attention that you will not be able to pay your taxes. An Enrolled Agent will be able to get the matter settled as quickly as possible and with as little damage to your finances and credit rating as possible.

If you already owe delinquent taxes, you will receive a bill from the IRS. This is the beginning of the collection process. Even though this is a difficult subject, do not ignore the notices from the IRS on what you owe.

The first thing an Enrolled Agent will do is to confirm the accuracy of the notices. The IRS is not always right. Then, you will work together to evaluate your ability to pay the IRS what is owed. An Enrolled Agent may be able to present options that you might not have thought of.

The IRS maintains the position that you should liquidate any assets you own, such as bank accounts, property, 401(k) plan(s), or other assets in order to satisfy your debt. They even recommend you get a loan, if you can, as the loan costs may be higher than the additional collection costs that may be assessed. In the end, you would prefer to owe a bank money rather than the IRS. If none of those options are available to you, then your representative will pursue working out an agreement with the IRS to settle the account.

Some of the options are full payment (again, borrowing money to pay the IRS may be cheaper), requesting additional time (which is only a temporary delay), or an installment agreement. In some more rare cases with higher balances involved, the Enrolled Agent will be able to make an offer in compromise or even request a hardship deferral if the debt is currently not collectible.

After the debt is settled, or at least on track to be settled, your Enrolled Agent will work with you to make sure the problem never happens again. Some tactics used in finding and fixing the root cause of the problem involve adjusting your withholding, setting up estimated tax payments, and providing you with any necessary education to understand how the tax system works.

Tommy Brown, Enrolled Agent, has helped thousands of people successfully resolve their IRS collection and tax settlement issues with the IRS. He can help you settle back tax debt, release IRS liens, stop IRS levy and seizure, and end wage garnishments. Stop the IRS from harassing you - call (618) 407-3674 or visit the http://tommybrown-ea.com to get tax help today.

Article source: https://articlebiz.com
This article has been viewed 715 times.

Rate article

Article comments

There are no posted comments.

Related articles