If you owe taxes to the IRS and can’t pay, it can be a stressful and overwhelming experience. Tax Resolution, also known as IRS Representation or Tax Controversy, is a formal process that can help you resolve your tax problems with the IRS.
Tax Resolution involves working with a tax professional, such as a tax attorney or an Enrolled Agent, who can help you negotiate with the IRS on your behalf. They can help you settle your tax debts, reduce penalties, and prevent further collection actions.
Here are some common tax problems that can be resolved through Tax Resolution:
- Not Filing Income Tax Returns for Several Years
If you haven’t filed your tax returns for several years, the IRS may file them for you. This is known as a Substitute for Return (SFR), and it typically results in a higher tax bill than if you had filed the returns yourself. If you have unfiled tax returns, it’s important to work with a tax professional to file them as soon as possible.
- Filing a Balance Due Return, But Can’t Pay
If you’ve filed your tax return but can’t pay the balance due, you may be able to work out a payment plan with the IRS. This is known as an Installment Agreement, and it allows you to pay off your tax debt over time. Depending on the amount of tax you owe, you may be required to provide financial information to the IRS to determine the amount of your monthly payments.
- Tax Assessed as the Result of an Audit, and Can’t Pay
If the IRS has audited your tax return and assessed additional tax, penalties, and interest, you may be able to appeal the decision or negotiate a settlement with the IRS. This is known as an Offer in Compromise (OIC), and it allows you to settle your tax debt for less than the full amount owed.
- Assessment of the Trust Fund Recovery Penalty (TFRP) Regarding Unpaid 941 Payroll Taxes from a Failed Business, and Can’t Pay
If you’ve owned a business that has failed and owe payroll taxes to the IRS, you may be assessed the Trust Fund Recovery Penalty (TFRP). This penalty holds individuals, such as business owners or officers, personally responsible for unpaid payroll taxes. The TFRP can be a significant amount of money, and it’s important to work with a tax professional to negotiate a settlement with the IRS.
In conclusion, Tax Resolution is a formal process that can help you resolve your tax problems with the IRS. Working with a tax professional can help you negotiate with the IRS, settle your tax debts, reduce penalties, and prevent further collection actions. If you’re facing a tax controversy with the IRS, it’s important to seek professional help to resolve the issue as soon as possible.