A lot of hardworking taxpayers don’t think it’s possible, but you can actually negotiate with the Internal Revenue Service (IRS) if you happen to have a large debt. The IRS’ sole existence is not to ‘get’ you. Many times, they are looked at as the bad guy—the villain who’s out to take all of your hard-earned wages.
What are Taxes for Anyway?
The fact of the matter is, if you like your living conditions, the way the streets are paved for better transportation—if you value the convenience of public transportation and things like your trash and recycling getting picked up, if you can appreciate the technology of the traffic lights (depending on where live in the country, maybe not), or maybe you’re just thankful for brave servicemen like firefighters and law enforcement patrolling the streets to make you feel safe, then you might want to start feeling OK with paying taxes!
How Does the IRS Determine How Much Taxes You Pay?
Now, we realize the actual problem comes when you discover that you owe and your annual income doesn’t seem like it’s enough to make ends meat—so how is it that you ended up owing Uncle Sam?
Well, there are a couple of reasons why you may owe the IRS a lot of money. Perhaps you didn’t fill out your W4 employment form right and you’re not getting enough taken out of your check during the year. Are there any unreported wages? There could be a mistake in your filing. One transposed number can throw everything off.
Don’t Try to Cheat the IRS
Don’t assume that the IRS will see an error on your right away. That’s what audits are for! And maybe, just maybe the IRS made an error. It happens.
Whatever the reason is for you owing the IRS, be encouraged that all is not lost. The IRS is reasonable and will work with you. All you have to do is call them and let them know that you understand that you owe, but you would like to negotiate a payment plan. Now, there are a few ways you can go about this.
Working Out a Deal
You can actually negotiate your tax debt to less than half of what you owe depending on whether or not what you owe is substantial. For instance, if you owe $1,000, the chances are pretty slim that the IRS will reduce that amount. At the very least, they may compromise with an affordable monthly payment for you to make. If this is the case, take it! The terms are strict though. One missed payment—even if you are late, then the deal is off and you’re back to owing $1,000 in full. If you’re late, then interest and late fees build on this amount, increasing the total amount you originally owed.
Sounds scary? It is. But it doesn’t have to be.
We have been in the business of alleviating taxpayer’s debt for over 30 years. We know what we’re doing.