subject: Being In Debt To The Irs Due To Back Taxes Can Be Overwhelming. Millions Of Americans Are Dealing Wi [print this page] /* Style Definitions */ /* Style Definitions */
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Being in debt to the IRS due to back taxes can be overwhelming. Millions of Americans are dealing with this incredibly stressful situation right now and the numbers continue to grow. The downturn in the economy and the serious increases in unemployment are making it almost impossible for the average person to be able to pay off debt of any kind let alone back taxes. There are answers, options that can help!
Surprisingly not many people are aware of the options the government has available to assist with paying back taxes. Most choose to ignore the debt until the IRS begins collection activities. The reason is more often than not fear, intimidation and lack of knowledge. Once you realize that you owe back taxes you panic and then because you do not know your options you choose to procrastinate and do nothing. This is the worst thing you can do! Penalties and interest begin to accrue immediately and can literally cause your debt to double or even triple if you do nothing but wait for the IRS to contact you.
The first option you should be aware of is the Installment Agreement. This option allows for you to work out a payment plan with the IRS based on your current income and financial situation. The government realizes that most people are not able to pay their back taxes in one lump payment and are willing to work with you to make the repayment easier.
The next option is the Offer in Compromise. This is a much more complex process and does require complete disclosure of your income and financial status. Basically you prove that you cannot pay the full amount owed and offer a lesser amount that you are able to pay. You should hire a tax professional to assist you with this process as it is crucial that you have all of your documentation in order prior to contacting the IRS.
If you are considering filing bankruptcy it is now possible to have your back taxes discharged in either chapter 7 or chapter 13 cases. There are very specific rules and criteria that must be met for you to qualify for this discharge. You will need to talk to your bankruptcy attorney to go over the criteria in detail.
These are just a few of the options currently available to help you get your back tax debt taken care of. Doing nothing will cost you enormously! You need to act swiftly in order to lessen the amount of interest and penalties that you will be required to pay!
