It’s almost that time of year again. It’s adult Christmas. You know what I’m talking about. Tax return season! That beautiful time where the government gives you back all the money that they’ve been taking throughout the year.
Although for a lot of us, tax season can bring a lot of headaches. April becomes less like Christmas and more like Halloween. Not the fun Halloween either. It’s more like this: Freddy haunts your nightmares and Uncle Sam is breathing down your neck.
Luckily, there are people and policies out there to help.
No matter the reason that the IRS is looking at you especially, help is available. There are several IRS Tax Debt Relief Programs available. In-depth information about each are easily accessible at sites ore like this. But to get you started let’s do a quick overview:
1. Offers in Compromise (OIC): This will allow you to pay less than the full amount you owe. The new amount will be based on your income and will be determined not to put you into financial hardship.
2. Installment Agreement (IA): Much like repaying a loan from a bank, the IRS will allow you to pay in monthly installments. If you qualify, you’ll have six years to pay back what you owe, and the money will be taken directly from your bank account.
3. Stair Step Agreement (SSA): This agreement allows you to first pay off larger debts, like a car loan, first. Typically the IRS will give you one year to finish paying off that debt. Once that time is over, the payment defers to the IRS to pay off the remaining taxes owed.
4. Streamline Installment Agreement (SIA): If you owe less than $100,000, you could be eligible for this. It’s streamlined because there is no need to list your assets, expenses, debts, or income. Just like the regular installment agreement, the IRS would allow you to pay off the debt within a six year period.
5. Partial Pay Installment Agreement (PPIA): This is a combination of the OIC and IA. You will pay the IRS in monthly installments totally to an amount that won’t put you into financial ruin.
6. Conditional Expense Installment Agreement (CEIA): This is the IA with further reductions to take into account living expenses. They would need a detailed report on your living expenses in order to reduce the monthly payments.
7. Currently Not Collectible Status (CNC): If you’re financial well-being is at stake, and you can’t possibly make payments to the IRS, they can put your account into this state. They will still charge interest on your outstanding debt, but generally won’t put your name into the collections department. Once you do become financially stable, you will still be expected to repay your taxes.
8. Penalty Abatement (PA): This is for first time offenders. You can send in a request to avoid whatever fees are being leveed against you. Think of it as a mulligan. You still owe money, but you aren’t being punished for having made a mistake. Everyone gets allowed at least one mistake in their life.