What To Do If You Owe the IRS
So you receive a
letter from the IRS in the mail and they have figured out that you have been
less than truthful when filing your tax returns. They have recalculated your tax and now you
have a bill. Or maybe, you filed your
return on time, but did not have the funds to pay the amount due to the
IRS. If you are like many of the people
with IRS tax issues, you likely want to run and hide – hoping the problem will
go away.
We see this very
often and I am telling you that your problem will not go away on its own. You need to face it and take steps to resolve
your IRS debt.
The first step is
making sure your tax returns were filed correctly, and you need to know how much
you owe the IRS for all years that are unpaid.
The IRS offers
installment payment plans depending on the amount you owe. This option allows you to pay your overdue
tax bill monthly until it is paid off.
If you have a large
balance due and you cannot afford to pay it back, you may consider an Offer in
Compromise. This is an option for people
who truly cannot and will not be able to pay off their debt in the near
future. If the IRS accepts you into this
program, you will agree to pay a smaller amount of tax to settle the debt. This sum is usually paid in one lump sum, but
may be spread over a few payments.
Honorine M. Campisi,
CPA
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