How Can I Be Relieved of IRS Tax Debt?
- In the US and other countries where tax debts are declared and paid via an annual tax return, the amount of tax debt for fixed-income earners is easily determined based on a tax table. When it is payment time, the amount of tax withheld during the year is deducted from the computed tax debt based on the table and the resulting difference is the net tax debt.
The same is not true, however, with professionals and people who run their own businesses. While they are covered by the annual filing procedure, they may not have withholding arrangements for shorter-period payments. This usually results in less tax payment during the year, if there is any, and consequently, the tax debt incurred at the end of the tax year becomes a serious settlement problem. - It is also possible that after an audit by the IRS of a return, the taxmen discover a tax discrepancy between the amount paid earlier and the amount that should have been paid, and they run after the taxpayer.
- Whether it is a current tax debt or a delinquent tax debt, it is when the tax debt becomes difficult to settle in full that some relief is needed.
The best relief of course is prior relief through correct taxes. So that relief may not be needed at all, taxes must be correctly computed, and periodic settlements arranged so that there are no lump sum surprises at the end. To be sure that all tax computations and schedules are correctly observed, it is wise to get the assistance of a professional accountant to provide guidance in setting up the tax payment system.
If the problem is current tax debt or tax delinquency, the first logical move is to get the services of a tax professional or tax adviser who has the necessary experience in dealing with the IRS on such delicate tax matters. This tax expert should be able to provide guidance in finding one or two appropriate solutions among a number of convenient settlement arrangements, such as installment payment, tax amnesty, compromise agreement, moratorium on tax payment, or even taking shield from the IRS ruling on bankruptcy. By reason of his experience in handling such cases with the IRS, the tax adviser should be able to get for the taxpayer the relief he needs, not only from the tax debt itself, but more so from the rigors of a long-drawn tax debt settlement process.