When you, a financially struggling taxpayer, is facing an income tax problem, your first question may be, “Can my IRS debt be forgiven?” The short answer is yes. Many forms of debt forgiveness, income tax included, exist for individuals with limited resources. While you may have several different debts that you’re juggling, you should always focus on paying Uncle Sam first. Before we examine some pitfalls to avoid, let’s discuss how you can go about getting your income tax debt forgiven.
While the IRS expects you to pay any balance immediately, you may find yourself in a financial position that makes this impossible. IRS tax forgiveness of an income debt exists in many forms, depending on the specifics of your finances. Although the IRS doesn’t have a 100% “tax forgiveness” policy, you may qualify to get a major portion of your balance reduced. For example, you may qualify for an Offer in Compromise (OIC), which allows you to settle your tax debt for far far less than you owe. However, an Offer in Compromise (OIC) can be difficult to qualify for and you’ll be required to provide a detailed expense analysis to the IRS. This IRS settlement option is best explored with the assistance of a Tax Lawyer who can quickly determine the likelihood of your eligibility. An Tax Lawyer may conclude that you qualify for a very different type of IRS tax forgiveness program.
There is a chance that your tax professional will conclude that you can’t afford to pay anything towards your tax debt. If this is the case, you may qualify for Currently Not Collectible (CNC) status. While not an official IRS debt forgiveness program, Currently not Collectible status prevents the IRS from actively pursuing action against you. Essentially, all collection efforts are suspended until you’re in a position to begin making payments. The IRS only has ten years to collect on your debt from the date it was assessed, it’s possible that you won’t pay anything toward your income tax debt if your financial position stays the same and doesn’t improve significantly.
Beware the “IRS Tax Forgiveness Letter”
Although there are many legitimate ways to resolve your tax issue, there are many scam artists who may take advantage of your unfortunate situation with the IRS. While you should heed any official letter or notice sent through the mail by the IRS, watch out for phony versions sent by scammers. Likewise, don’t respond to any “IRS tax forgiveness of debt form” sent to you via email. There is "no such thing" as a "IRS tax forgiveness letter." You may as well be looking for a "Unicorn" or "Big Foot."
You want to avoid scam artists, but you also want to seriously consider consulting with a professional tax resolution company like Flat Fee Tax Service, Inc. before dealing with the IRS. Conduct your research on any company you’re thinking of contacting by reading online reviews and verifying that the organization in question has licensed tax professionals like the IRS Tax Attorneys at Flat Fee Tax Service, Inc. A Tax Lawyer such as one from the our IRS tax relief team can help you carefully weigh your IRS income tax resolution options, including every tax forgiveness program available to you. Make sure that the IRS tax relief team that you choose is Accredited by the Better Business Bureau and has an A Plus Rating.
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