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Every taxpayer has an obligation to file his or her returns each April and pay whatever they owe to the government on time. Sometimes, however, meeting this important obligation can be difficult or impossible especially if you are already experiencing financial difficulties. Rather than avoid this duty altogether, you could seek out remedies that will put you on the right side of the IRS without compromising your income or your assets. By considering all of your options for tax debt relief help New York taxpayers like you can settle what you owe in a timely and legal manner.
You may be able to pay something toward your IRS obligation but not the full amount. In this instance, an Offer in Compromise could be the best solution for you. This choice, dubbed an OIC, basically lets you make an offer or to compromise with the government to pay a lump sum on the obligation. The lump sum will not be the actual owed amount, however.
Instead, it will be based on your current income as well as what liquid assets you have at your disposal. You are expected to make a realistic compromise so the IRS knows you are in earnest with your offer. Offering too little will more than likely get the OIC rejected. You are expected to base it on the money you earn and have in your bank account as well as any valuables that could be sold off if necessary.
Your next option would be to ask for a payment agreement or installment arrangement. This option allows you to make monthly payments based on what you earn each month. The payments are affordable and are not designed to put stress on your finances.
The government will then figure out how much you can afford to pay each month based on how much you earn. The payments will not be so high you cannot afford them. Instead, they may actually be low enough to fit into your household budget relatively easily.
However, some people just simply cannot afford to make any kind of payments at all. They live paycheck to paycheck and barely have enough to cover housing costs, groceries, and other necessities. In this instance, you can ask the IRS to put your account in CNC status. CNC status means Currently Not Collectible, meaning you have no financial means to settle the account. Your debt will still incur penalties and interest.
When you seek out advice and counsel on your IRS debt, you may ask how old the debt actually is. By law, the government can only pursue collection on past balances for 10 years. Once a debt is 10 years or older, it must be written off by the government, and the taxpayer forgiven for the obligation.
By knowing the choices available to you, you can make a proactive decision regarding your tax debt and what kind of help you want to pursue. You take the upper hand to stop penalties and interest. You also can determine how fast or slow the amount is paid off in full, releasing you from any further duty to the government. Your income and assets will come into play during the process.
You may be able to pay something toward your IRS obligation but not the full amount. In this instance, an Offer in Compromise could be the best solution for you. This choice, dubbed an OIC, basically lets you make an offer or to compromise with the government to pay a lump sum on the obligation. The lump sum will not be the actual owed amount, however.
Instead, it will be based on your current income as well as what liquid assets you have at your disposal. You are expected to make a realistic compromise so the IRS knows you are in earnest with your offer. Offering too little will more than likely get the OIC rejected. You are expected to base it on the money you earn and have in your bank account as well as any valuables that could be sold off if necessary.
Your next option would be to ask for a payment agreement or installment arrangement. This option allows you to make monthly payments based on what you earn each month. The payments are affordable and are not designed to put stress on your finances.
The government will then figure out how much you can afford to pay each month based on how much you earn. The payments will not be so high you cannot afford them. Instead, they may actually be low enough to fit into your household budget relatively easily.
However, some people just simply cannot afford to make any kind of payments at all. They live paycheck to paycheck and barely have enough to cover housing costs, groceries, and other necessities. In this instance, you can ask the IRS to put your account in CNC status. CNC status means Currently Not Collectible, meaning you have no financial means to settle the account. Your debt will still incur penalties and interest.
When you seek out advice and counsel on your IRS debt, you may ask how old the debt actually is. By law, the government can only pursue collection on past balances for 10 years. Once a debt is 10 years or older, it must be written off by the government, and the taxpayer forgiven for the obligation.
By knowing the choices available to you, you can make a proactive decision regarding your tax debt and what kind of help you want to pursue. You take the upper hand to stop penalties and interest. You also can determine how fast or slow the amount is paid off in full, releasing you from any further duty to the government. Your income and assets will come into play during the process.
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