Early Back Tax Relief Gives More Benefit
Last updated on May 4, 2022
When resolving back taxes, taxpayers often wait until after the IRS sends them a notice regarding the tax debt or moves to aggressive collection actions such as tax lien or tax levy. It is important for taxpayers to know that if they pay their back taxes late, they will end up paying more overall because of monthly penalty and interest charges.
Even after taxpayers have applied for a tax resolution plan, such as Installment Agreement, they will still pay interest on the debt amount while it remains unpaid. If taxpayers pay as much as they can with the initial payment under Installment Agreement, they can reduce paying more in interest.
The IRS wants to collect as much amount as possible as early as possible. Taxpayers who pay the debt amount in full save money on interest, but as most taxpayers cannot afford to pay back the entire tax debt amount in a single payment, they look for other options. There are various ways to get back tax relief, including a reduction or forgiveness of penalties, or innocent spouse relief.
One of the advantages of an early back tax resolution is saving money. The second major advantage of an early resolution is avoiding any aggressive IRS collection actions. If the tax debt remains unpaid for years, taxpayers pay much more than they originally would. Therefore, it is wise to use legal help to explore the various options taxpayers have in paying their tax debt. Early back tax relief is always more advantageous than procrastination.
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