Tax Debt Help

Filed Under Debt and Debt Relief, Tax Debt

Having a tax debt is perhaps the most stressful type of debt anyone can have. The debt is with the government after all and they have the ability to do much more than send you collection letters. Ultimately, they can seize your bank account and your other assets. So owing money on back taxes is indeed something to feel stressed out about and finding real tax debt help is a necessity.

But what options are available to you when you want to settle tax debt? Who do you contact? Where do you go?

The first option you should consider when dealing with either IRS tax debt or state tax debt is to find a way to pay the entire amount off in full. If you have a credit card with a low enough balance then that might be the way to go. If you can borrow the money from a family member or friend, that’s another possible solution. Of course neither of these options is very attractive, but let me assure you, dealing with the government later on is less attractive still!

If you don’t have the means to achieve an immediate tax debt resolution, then you need to bite the bullet and contact the tax agency as soon as you can to work out a repayment agreement. Keep in mind that the clock is running on your debt and that interest and penalties will continue to accrue on your balance every day – and deadlines will just get shorter. So the sooner you get in touch, the better it is for you.

All agencies have phone numbers but some are extremely difficult to reach. Prepare yourself to be on hold for quite a bit of time. Also, make sure you have all of your important paperwork laid out in front of you so you can reference anything you need during the conversation.

Most agencies will allow you to work out some sort of repayment arrangement with them, providing of course that you haven’t broken a previous agreement or defaulted in some other way. This sort of tax settlement help isn’t open to much negotiation. Most agencies want all of the tax debt paid off in 5 years or less so payment amounts are usually not very flexible. Plus most agencies will want their money delivered automatically via a monthly debit of your bank account, though you can still settle IRS debt with monthly checks.

Once the tax debt settlement plan is worked out you must stick to it absolutely – no variations! If you’re so much as late with a single payment the tax agency can cancel your agreement and demand payment of your tax debt in full. At that point it’s very difficult, if not impossible, to negotiate a second agreement

If handling all of this work seems just too much to bear, you could hire a tax debt attorney to work for you. This will of course be an extra expense for you but it could make sense in some cases. For instance, if you feel the tax bill is incorrect or feel there are some extenuating circumstances that should be taken into account for your case, then a tax attorney may be a good choice. They can negotiate through doors that aren’t generally open to the normal tax payer. And they have the experience to use all of the tools available – an example of which would be filing an offer in compromise to try to negotiate your tax debt to a lower amount.

In any case, finding tax debt relief is a stressful undertaking – but an absolutely necessary one. Tax debt will not go away and the penalties and interest that can be piled on can be significant. You cannot ignore the letters and correspondence because that will only make matters worse. It is a difficult road to go down but you need to find a way to do it because the alternative is even more difficult.

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