4 Options to Solve IRS Tax Debt
How to get out of tax debt ?
IRS tax debt is problematic and should be solved as soon as you can. Owing the IRS can be very scary and the IRS can make life difficult for you in their efforts to collect tax debts. The IRS often utilizes tax liens against your property and bank levies against your accounts to collect delinquent taxes. In fact, recently there was news that Tax Debt Can Take Away Your Passport! .But the main question is owe to get out of tax debt ? Are there are indeed some ways to get out of the tax debt quagmire .? The answer is a definite Yes. You have at least four options to reduce, manage and eventually eliminate your tax debts:
1. Scrutinize your past returns.
Consult your CPA or tax attorney with your tax return if you filed yourself. It may just happen that he may identify certain exemptions and deductions that may be available to you , but you forgot to claim. In that case, your tax attorney/CPA will refile the correct returns which may reduce any tax balance you may owe the IRS.
2. Go for tax instalment plan
Ask your CPA for filing an Installment Agreement under which IRS may agree for a repayment plan stretched over a period of up to six years. This will lessen the burden on you for full payment on time.
3. Filing an Offer in Compromise (OIC).
An Offer in Compromise is a settlement plan for paying the full amount of tax debt but less than the actual amount of tax owed. Just note that if you have significant income or asset, the OIC is not the best option for.To know more about OOIC,please read Offer in compromise : What , When & How ?
4. File a Chapter 13 bankruptcy
A Chapter 13 bankruptcy plan allows you to set up a debt repayment plan that is based on your household income, household living expenses, and the type of debts including tax debt you owe.T he Chapter 13 bankruptcy filing provides you a legal protection from all of your creditors including the IRS . Consult your CPA if this option is suitable for you .