Five Strategies For Paying Back Taxes
There are 5 key strategies that may offer back tax relief and getting out of tax debt.
1. Offer in Compromise
OIC involves an agreement with the IRS to reduce tax liability, so you can reach a tax debt settlement lower than you currently owe. You make your IRS tax debt payout in one lump sum or through a short term IRS tax payment plan.
2. Installment Agreement
The installment agreement program is a monthly tax debt plan for paying off the IRS.
3. Not currently collectible
Not currently collectible is a program where what tax debt you owe is deferred by the IRS by voluntarily agreement, who do not collect money for back tax debts for a year or more.
4. Partial payment installment agreement
Partial payment installment agreement is a long term payment plan where the IRS tax debt payout due is paid off at a reduced dollar amount.
5. Filing tax liability bankruptcy
Filing tax liability bankruptcy occurs under a Chapter 7 or 13 bankruptcy petition. However filing bankruptcy will not erase IRS debt.
Using the appropriate strategy may result in a decrease in the IRS back tax debt.
Articles & Features
You can get some relief from back taxes owed by negotiating a reduction in tax debts with the IRS or an agreement to extend the duration to pay off the tax.
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Offer In Compromise
Taxpayers who satisfy certain criteria may receive an offer in compromise or tax reduction from the IRS on their tax liability.