If you’re unable to pay your back taxes, you’re not alone. Many Americans have a difficult time coming up with the money they owe to the I.R.S. However, even if you don’t have the money to pay your back taxes, you’re still responsible for the debt. In fact, ignoring your tax return obligations can lead to serious consequences, including a criminal investigation by the I.R.S. The good news is that the I.R.S. offers programs designed to help people meet their tax obligations, especially if they are unable to pay because of a financial hardship.
The I.R.S. has two main programs for delinquent tax payers: installment agreements, and an Offer in Compromise. Although a payment plan seems appealing at first, the I.R.S., it’s usually not in the best interest of the debtor because the I.R.S. charges an additional fee to setup an installment agreement. What’s more, the agency might charge an additional fee if you fall behind on your agreement, adding more dollars to the amount you already owe and are unable to pay. This is why many people seek an Offer in Compromise, the second I.R.S. program for people who are unable to pay their taxes.
According to the I.R.S. website, an Offer in Compromise is “the ability to settle your tax debt for less than the full amount you owe.” It’s a great option for many people. However, applying for this program through the I.R.S. can be frustrating. How do you know if you qualify for an Offer in Compromise? Which forms do you need? What if your case is rejected? Instead of handling the issue on your own, consider hiring a tax lawyer.
If you’re unable to make pay your back taxes and would like to request an Offer in Compromise, a tax attorney can help. A skilled and experienced tax attorney can help you make an Offer in Compromise with your best interests in mind. In addition, an attorney can assist you with properly filling out the right paperwork. Unfortunately, many people don’t know how to fill out the forms properly and end up offering too much money. The first step is to contact a lawyer to have your case evaluated. A tax attorney in San Jose or the city in which you live will analyze your case and let you know if you qualify for an Offer in Compromise. If you qualify, he or she will then tailor an action plan that is best suited for your unique situation.