Tax Relief Options You May Consider to Resolve Tax Problems

Tax Relief Options You May Consider to Resolve Tax Problems

March 29, 2023 0 By Maria

To address some complex tax problems, you need tax relief solutions. Here are some tax relief options you may consider.

If you let your taxes get out of control, you risk collection actions such as wage garnishments, asset seizures, among others. However, no matter your tax situation, there is always a way out to fix your tax problems. If you get a tax notice from the IRS, you should not assume the notice. You should respond by either paying the taxes owed or if the debt is huge, you should think of filing an installment agreement plan. Learn more about tax relief options here.

What are tax relief solutions?

Before we look at the tax relief options available to taxpayers, it is important to have a clear understanding of what tax relief options are. These are solutions available to taxpayers who have huge unpaid tax debts. The solutions aim to help you negotiate with the IRS to forgive or reduce your tax debt. Also, there is an option to spread out what you owe and pay in installments. Here are the solutions.

  • Partial pay agreement or installment payment plan

If you owe a lot of money to the IRS, you are likely to have complex tax problems that can be costly. A huge tax debt can get you into more debt as a result of interest and penalties. You can avoid that by making a minimum monthly tax payments or negotiate for a tax payment plan with the tax authority. With the help of a tax expert, you can negotiate the amount you can pay every month. The interest and penalties will continue to accrue, but you can obtain penalty abatement. You just need to be reasonable and that can save you big money in the name of penalties.

  • Offer in Compromise

If you are in a difficult financial situation and can’t pay the full amount of taxes you owe the IRS, you can consider offer in compromise.  This option offers you a chance to pay lesser tax bill. However, it is not easy to obtain a successful offer in compromise, but with the right strategy, yours can go through. The taxing authority will assess your assets, income, expenses and overall financial situation before rejecting or accepting your request.

  • Penalty abatement

One thing you need to understand is that your tax bill can double or even triple depending on how long you take to pay up. However, if you have a valid reason that made you delay to make your payment, the IRS can forgive you some or all of the penalties. If the IRS had an error or you were involved in serious accident that left you injured or disabled, the IRS may consider your penalty abatement request. The reason for late or delayed payment must be ‘reasonable’.

  • Amending your tax return

If you have not been serious when filing your tax returns, you can be missing a lot when it comes to tax deductions and credits. If you take advantage of the tax exemptions, credits and deductions, your tax bill can be lesser. Therefore, if your tax bill is a bit high, you can consider to amend your tax return to ensure your tax liabilities, credits, and tax credits are well taken care off. That way, you can bring down your tax bill if you had missed some tax credits and deductions.

  • Audit defense

If you are facing a tax audit from the IRS, you need to have a good tax attorney. The attorney will ensure that your interests and rights are protected, and that can prevent IRS from finding more punishable tax mistakes. You know tax mistakes can be costly as a result of penalties. With a tax attorney or expert to help you during the audit process, you never know, some tax mistakes will not be found.

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Final Words

Tax problems can land you into more debt. For that reason, you need to think of tax relief solutions that can help you clear your debt easily through installment payment plan. Also, some tax relief options can help you pay less tax bill than owed. Depending on your tax and financial situation, consider the option that suits your right.