Questions to ask when you owe the IRS moneyIt is a nightmare that millions of Americans find it hard to wake up from; the IRS. You miss something, or through no fault of your own, you owe the IRS money. The expectation to pay thousands of dollars that you do not have is an emotionally draining experience. Did you know that you can reach a quick tax resolution with minimum financial consequences? At True Resolve Tax Professionals, we believe in honesty and ethical conduct. We guide our clients to the tax resolution option that will have them pay no more than the amount allowed by law. In this article, we shall discuss some of the burning questions sizzling off the tongues of many taxpayers in Denver, Colorado, and the entire United States of America.

What to do when you cannot pay your taxes on time?

When the deadline is approaching, and you cannot file your return in time, what do you do? Most people are aware of the filing extension. This gives you more time to submit your income tax returns. One of the best-kept secrets of the IRS is the fact that you can get an extension of time to pay your taxes. You can get a six-month extension to file your returns, but you still owe the IRS money. The filing extension does not help you when you cannot pay. However, the form 1127 (application for an extension time to pay taxes) helps in this cause. If you file this form before the due date, you can get up to six additional months to pay the taxes you owe without penalties. The tax debt still attracts interest, but the elimination of penalties is a significant relief. Sadly, this process is not automatic. You need a reason to earn the acceptance of the form 1127. You need to show and prove that there is a financial hardship in your life. For example, if you say that you’ve had some medical issues, you will need to attach your doctor’s medical report to your form 1127. That will go a long way in proving your case. The burden of proof is on the taxpayer.

What do you do when you owe the IRS a significant sum of money?

Millions of Americans owe the IRS money. Many taxpayers are afraid of checking the mailbox, terrified of opening letters from the Internal Revenue Service. Maybe you share in the fear that the IRS will knock down your door and drag you to jail. As a tax resolution firm, True Resolve Tax Professionals would like to reassure you that this myth is unfounded. The first thing you need to understand is that you are not going to jail. It is a crime to cheat on your taxes, it is a crime to file a false return, it is a crime to lie to the IRS, but it is not a crime to owe the IRS money. It will surely make you broke but not a criminal. There are flagship programs to help taxpayers settle their debt. There is the offer in compromise where you are obliged to pay a small portion of your total tax debt and the IRS installment agreements. All of these are tax resolution options. At True Resolve Tax, we assess your situation before we chart the perfect resolution solution fit for your needs. We will get you that settlement that will have you pay the least amount of money allowed by law. Owe the IRS money? Call us, let us discuss the options available to you.

What is the difference between Partial pay agreement and the offer in compromise?

Partial pay agreement is an option among the IRS installment agreements. Each case is unique, but sometimes the partial pay agreement is better than the offer in compromise. To understand the partial pay agreement, you need to know that there is a ten-year statute of limitation governing IRS tax liability collection. If a taxpayer files a tax return with a balance due, there is a ten-year time limit for the IRS to collect that debt. In a case where you owe the IRS money, and can’t afford to pay, the IRS can enter into a partial payment agreement. This happens when you are left with a low number of months before the expiry of the statute of limitations. For example, you approach us, True Resolve Tax Professionals, with a tax liability worth $100,000. There is a 17-month period left in your collection statute. You are a low-income taxpayer, and you do not want to enter an offer in compromise. You do not qualify for hardship because you have $100 of disposable income. When you come into a partial pay installment agreement, the IRS will expect your $100 disposable income for 17 months. This means that you will pay $1,700 on $100,000 tax debt. Sound far-fetched? Those are the rules.

On the other hand, the offer in compromise lets you pay a settlement which is a smaller amount compared to your total tax debt. Not everyone qualifies for the offer in compromise. Your eligibility is calculated using mathematical equations. If our tax professionals feel that you are qualified for the offer in compromise, we give you the green light to apply. The IRS will only accept your offer if it is the most reasonable amount that you can pay over the collection statute of limitation. What you need is a tax resolution service that will negotiate a partial payment agreement on your behalf. Which one is better? The offer in compromise or partial pay agreement? Both resolution plans end up only paying part of your total tax liability. Each case is different; your case will determine which option is better for you. Sometimes you may not qualify for an offer in compromise, and partial pay will be your better option. Other times the offer in compromise will end up being the least amount. Our job at True Resolve Tax is to find that resolution option that will have you pay the lowest possible amount allowed by the law.

Why lose sleep at night? Why fear that you will lose your assets when you have True Resolve Tax Professionals? We have the staff and experience for whatever tax issue you may find yourself. Our agents are enrolled with the IRS to deal with many tax-related problems. These include client representation, tax preparation, and tax resolution. Call us for a consultation. Visit our offices for a face to face meeting. We treat our clients like family. Facing the IRS is an intimidating affair. We believe that life should be simple. We can make it simpler. You do not have to take our word for it. Try True Resolve Tax Professionals for a swift tax resolution.

True Resolve Tax Professionals, your number one tax resolution partner.

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