Taxpayers who are unable to pay their IRS tax debt in full could get relief and settle their IRS tax debt for less than they owe through an offer in compromise or a partial pay installment agreement with the IRS.
What is a Tax Debt?
Simply put, an IRS debt is the amount of taxes owed during a certain tax period that should have been remitted to the IRS. Paying an IRS tax debt should not be a difficult task, it is closely and religiously monitored by the IRS. Employers, in particular, should routinely calculate and withhold payroll tax from their employee's paychecks and properly forward them to the tax agency. People who have their own businesses are also subject to such IRS debt known as self-employment tax, and should be able to manage and pay these taxes in a timely manner, so as to avoid getting penalized by the IRS.
Federal or State Tax Agencies
Federal tax agencies such as the Internal Revenue Service (IRS) have a system of determining the total amount of tax debts for a tax year / season easier because they receive annual return reports which reflect the value of money that a certain taxpayer makes as wages, self-employment or investment income through W2's and 1099's. This way, it is easy to compare such figures with the total amount of taxes paid for the duration of the filing period. Whenever the amount of paid taxes is in excess with the amount owed, refunds are granted to the taxpayer as they file accordingly. However, if the amount of collected taxes is less than the actual IRS debt owed, the taxpayer is still responsible for compensating the IRS or the State with the outstanding debt.
Unresolved IRS Debt – how to get tax relief
Unresolved tax debt is taxes on earned income that are not calculated nor remitted properly. This error, though not necessarily intentional, will still come to the attention of the IRS, usually during the filing of the annual returns. This can put the taxpayer in a situation where he is faced with a greater amount of tax debt than he expected. This creates more stress and pressure on the individual to pay off the tax debt especially since the amount is more than he can really afford.
Many tax agencies, however, are willing to resolve unpaid tax debts through different tax relief programs especially when the taxpayer is no position to pay the total amount owed with interest and penalties. Tax settlements can also be negotiated between the taxpayer's power of attorney and the taxing agency like the IRS or the State. It is fairly common; that the tax agency imposes a tax levy like a garnishment on the taxpayer's wages ; also a levy on the taxpayer's bank account is a common practice by the IRS and or the State.
In more severe cases when the taxpayer ignores the IRS for a long period of time, the tax agency can seize some assets in order to collect and settle the IRS debt owed. This usually happens when the outstanding tax debt is not resolved and the taxpayer is uncooperative about settling their tax debt.
Settle your IRS debt and get relief today
If you are unable to pay your mounting IRS debt, then you most certainly need the assistance of our IRS debt relief services. Free yourself from such tax debts and be guided on how to prevent any other tax problems that may catch you off guard in the future. With expert advice and proper guidance, you would surely be free of any tax problems.