Dealing with tax debt can be overwhelming, but there are options available to help individuals and businesses resolve their tax obligations. If you are going through a tax debt crisis, it is important that you explore various tax debt resolution options and discuss how they can provide relief to taxpayers facing financial challenges.
Installment Agreements
Installment agreements allow taxpayers to pay off their tax debt over time through monthly installment payments. These agreements are ideal for individuals and businesses who are unable to pay their tax debt in full but can afford to make regular payments over an extended period. A trusted lawyer can assist taxpayers in negotiating favorable installment agreements with the IRS or state tax authorities.
Offer In Compromise
An offer in compromise (OIC) allows taxpayers to settle their tax debt for less than the full amount owed. To qualify for an OIC, taxpayers must demonstrate that they are unable to pay their tax debt in full and that settling for a reduced amount is in the best interest of both the taxpayer and the government. A lawyer, like a tax debt lawyer, can help taxpayers prepare and submit a compelling OIC that maximizes their chances of acceptance.
Penalty Abatement
Penalty abatement allows taxpayers to request the removal of penalties assessed by the IRS or state tax authorities for failure to pay taxes on time or file tax returns. Penalties can significantly increase the total amount owed, so obtaining penalty abatement can result in substantial savings for taxpayers. When you work with a trusted lawyer, they can assist taxpayers in preparing and submitting penalty abatement requests supported by valid reasons, such as reasonable cause or first-time penalty abatement.
Currently Not Collectible Status
Taxpayers who are experiencing financial hardship and are unable to pay their tax debt may qualify for currently not collectible (CNC) status. CNC status temporarily suspends collection activities by the IRS or state tax authorities until the taxpayer’s financial situation improves. While in CNC status, taxpayers are not required to make payments towards their tax debt, providing much-needed relief during difficult times. Attorneys can help taxpayers demonstrate their financial hardship and obtain CNC status.
Bankruptcy
In some cases, filing for bankruptcy may be an option for resolving tax debt. Chapter 7 bankruptcy can discharge qualifying tax debts, while Chapter 13 bankruptcy allows taxpayers to repay their tax debt through a court-approved repayment plan. Lawyers can evaluate taxpayers’ financial situations and advise them on whether bankruptcy is a viable option for resolving their tax debt.
Getting Trusted Help In Difficult Times
Tax debt resolution options provide relief to taxpayers facing financial difficulties by offering manageable repayment plans, settlements, penalty relief, and other forms of assistance. Whether through installment agreements, offers in compromise, penalty abatement, currently not collectible status, or bankruptcy, our friends at Wright Law Offices can help taxpayers navigate the complexities of tax debt resolution and achieve a favorable outcome. If you’re struggling with tax debt, don’t hesitate to seek professional assistance and explore your options for relief.