IRS Help 101: Your Possible Back Tax Payment Options

If you owe the Internal Revenue Service (IRS) back taxes you'll be hearing from them in the near future.  The IRS claims that each year Americans who don't pay taxes end up generating about $290 billion in uncollected taxes, and those billions of dollars could be helping fund government programs that are in desperate need of money.  The government has been pursuing people who owe back taxes more aggressively; regardless of if they owe a single year of back taxes or decades of unpaid taxes. 

Don't panic if you owe back taxes.  The government may be going after people that owe the IRS money, but they also provide a variety of payment plans, programs, and solutions for citizens that owe the government tax money.  A tax resolution company would be able to help you find the most efficient and cost effective solution for paying your back taxes.  Listed below are a a few options that a tax resolution company may use.

Installment Agreement

Installment agreements are available to people who can't pay their tax debt in full at one time.  The program allows people who on an installment agreement to make monthly payments until their entire debt is paid back. One thing to note about these agreements is that it takes a long time to pay off debts due to added interest and penalties. These are very often long-term plans as well.

Offer in Compromise

An offer in compromise allows taxpayers to permanently settle their taxes for less than the amount that they owe If you submit in an offer in compromise to the IRS, then the IRS will have to look at several factors like your current level of income, your expenses, and your asset equity.

Advice For People Who Owe State Back Taxes

It's possible for citizens to owe back taxes to the IRS and taxes to their own state.  The process for state tax settlements is very similar to the process for federal tax settlements, but there are a few key differences that vary from state to state. A tax debt resolution company will have each individual’s state information.

*Not a solicitation for legal services*