Are you behind on your taxes? Even if you are, you are not alone. Several common people find it difficult to understand and file federal taxes every year. According to our nation’s law, every earner is bound to pay taxes if their yearly net income exceeds a certain limit. This earning limit is different for men and women. So, we can say, if you are a responsible citizen of this country, you must pay taxes regularly.
According to tax experts (including tax law attorney), if you are behind your taxes, the IRS can send you notice or investigate further why you have defaulted. Generally, the IRS sends official notice to that person first. He/she has to give a valid reason; IRS can offer you multiple options to pay your debt. Let’s discuss some common methods that IRS enforces to settle pending taxes.
Payment Instalment Plans
One of the most important and popular methods for a tax settlement is instalment plans. If the IRS thinks they can give you time and instalment options, in which you can repay your debt in small instalments.
It is like paying an instalment to a bank for a loan payment. IRS allows this opportunity only to those who they think need help. In this method, you must pay your past debt and interest.
Do you know? The IRS is entitled to garnish your wages if they think you are not paying your tax debt intentionally. In fact, they can garnish all federal payments like-tax refunds and social security.
If the IRS has already garnished some of your assets, you should immediately contact the IRS. Try to consult a professional tax expert (like Pasadena tax attorney) as soon as possible. With proper negotiations, the garnishment amount can be reduced.
Get Expert Help
Dealing with a statutory body like IRS is not easy if you are planning to represent yourself in front of them. It is advised to take expert help as soon as possible. Professional tax experts are adept in tax settlement. They can represent you in front of the IRS on your behalf. He can understand your problem, analyse it and then devise a plan to make the case in your favour. Choose a person with enough experience dealing with the IRS to get a better result.
If your tax expert can convince the IRS that you can’t pay full taxes now, but in future, you will, they will label your case as “not collectable” status. This is not a permanent solution. But it can give you the time to think about what to do next.
File For Bankruptcy
Have you ever learned about bankruptcy? When a person is in heavy debt and does have not enough assets to repay those debts, he can declare himself bankrupt. IRS will check every minute detail if a person files for bankruptcy. Chapter 7 and chapter 13 of the bankruptcy codes mention how the IRS and other federal bodies look into things to search whether the man is bankrupt or not.
You can get help from this bankruptcy rule; it is a person’s last option. When you have no other option, you can go for bankruptcy.
We have tried to enlighten you on how to settle pending tax returns with the IRS. Hope this post will help you understand how the IRS works and what should we do when we are in trouble. To know further, please contact an experienced person in law and taxation.