Effectively Managing Your Tax Debts
Owing to the IRS can be stressful. Also, dealing with the IRS isn’t at the top of anyone’s list, but if you owe the IRS money and are avoiding them, you could be setting yourself up for more trouble down the line. While evading the IRS may provide temporary relief from the stress of your unpaid taxes, it may subject you to more serious consequences.
Like any other type of creditor, the IRS retains the right to pursue collection efforts against you. However, the IRS is given more flexibility and rights when it comes to how they can pursue debt collection. For one thing, the IRS is much quicker to implement wage garnishment orders against your paycheck or bank accounts when collecting unpaid tax debts. They may even be able to place a tax lien against your property until your debts have been satisfied. Neither of these situations is one you want to be in, so there are some simple strategies to help you manage your tax debts before more serious consequences are ordered.
open communication
The first place to start any debt resolution plan is to contact the creditor, or in this case, the IRS. How can they help you if they don’t know you have problems? Also, the IRS looks more favorably on someone who is willing to contact them for help, rather than dodge their calls. After all, if you are truly innocent in your financial difficulties, then you have nothing to hide.
It is important that you contact the IRS immediately to begin the debt resolution process. When contacting the IRS, ask to speak with an account manager or supervisor, as they tend to have more of an advantage when negotiations are in order. Always be courteous and never threaten or use abusive language with an IRS agent. If you want them to be compassionate and understanding of your situation, you must treat them with respect.
Debt Negotiation
You may be surprised to learn that the IRS is actually quite understanding when it comes to tax debt. They understand that it can be difficult for many people to pay their debts, especially in a lump sum. Did you know that the IRS offers two programs to help taxpayers pay their debts easily and affordably?
The IRS is more willing to negotiate than you think, but it takes a bit of effort on your part. You may be able to get an installment plan, where you can pay your tax debts in monthly payments for a few years. This helps remove the overall financial burden while still working to pay off debt. For those who are experiencing more significant financial hardship and cannot pay their debt obligations in full, the IRS may be willing to accept an offer in compromise. In an offer in compromise, the IRS agrees to settle the debt and accept less than what is owed, but the offer must be equal to a reasonable amount that you can afford to pay.
