How to Resolve Tax Debt More Comfortably

Last updated on June 13, 2022

Taxpayers with tax debt look to resolve their debt fast and smoothly even if they cannot get their total debt amount reduced. It is important for taxpayers to consider their financial condition, their ability to pay, and the duration of unpaid taxes to prepare their tax case appropriately. Taxpayers must know the broad particulars of their case so that they can have realistic expectations of the outcome.

The responsibility of getting the right tax help rests with taxpayers. Even though most tax services are honest, there are scam tax companies that try to sell their services using misleading advertising. Taxpayers must conduct research to avoid such schemes. As most tax resolution companies offer a free consultation, taxpayers can gather information about the company and its services to ensure they are making the right decision.

To assist taxpayers in resolving their tax debt more comfortably, the IRS has introduced Fresh Start initiatives, namely the Fresh Start Notice of Federal Tax Liens, the Fresh Start Installment Payment Agreements and the Fresh Start Offer in Compromise initiatives. Now, taxpayers can benefit from greater flexibility from the IRS when resolving their tax debt through an Offer in Compromise or an Installment Agreement.

The resolution of tax debt, if done at the earliest, provides the most relief to taxpayers, as it limits the interest that the IRS charges on a tax debt. Interest and penalties charged on any amount of back taxes can substantially increase the amount of a tax debt. Therefore, an early resolution is the best resolution.