Are you one of the estimated 8.2 million Americans who owe the IRS? If you have extenuating circumstances that are preventing you from paying your taxes on time, instead of just being a criminal and deciding to not pay what you Uncle Sam, you could be eligible for relief. Here are some IRS debt relief measures that you can take:
Reduce your debt
The IRS will allow for reduced debt and a repayment plan if you cannot repay your debt in full within 6 years. You will need to visit the IRS website at irs.gov and download IRS form 656B. Once you full out this form in full, specifically form 433A, you will then know the minimum amount that the IRS will require you to payback. You will need to file both forms by mailing them to the IRS. They will require you to pay a portion of this bill upfront, as well as a $150 dollar application fee. The good news is that the IRS will apply this $150 to your debt balance if they accept your repayment proposal. The IRS will often accept these terms if they are reasonable. Pro-tip make the minimum you will offer the IRS at least 5% more than the minimum they will accept, this will help to ensure acceptance of your proposal. This will effectively allow you repay less than what is owed, it is the government version of a settlement. Often times the IRS will take a settlement, as getting something is better than getting nothing.
Erase Your Late Fees
If you like 10.4 million other Americans were late on filing your tax returns by the deadline, you are nto alone. You could however be on the hook for a 4.5 percent per month on the balance owed, plus a penalty interest of 3.19 percent. Yet if you have missed this deadline for a valid reason you can get forgiveness of these late fees and penalty interest rates. Good reasons include the death of a spouse or family member, divorce, illness, or any natural disaster. You simply need to alert the IRS to this situation, it is as easy as that. To remedy this problem you simply need to send the IRS via certified mail a detailed letter stating why you have reasonable cause to have failed to file on a timely manner. You then should request an abatement of the late filing and late payment penalty interest. All you need to do in this letter is to explain what hardships you faced and how it impacted you with the filing of your taxes by the deadline. Despite popular belief the IRS can be quite understanding, you just need to follow proper procedures and state your case.
Pay Your Bill Over Time
If for whatever reason you cannot pay for the entire balance that you owe the IRS by the deadline, you can always attempt to enter into a payment arrangement with the IRS. This is known as an installment agreement, and it is fairly easy to set up with the IRS. You will however be in the hook for interest of 3.19 percent, as well as a $105 dollar fee. You simply file your taxes as normal, sending in as much money as you can, then navigate to irs.gov/individuals and fill out the online application to set up your repayment plan. The IRS will determine your payment amounts, based largely on how much you owe, coupled with your ability to repay the debt within 6 years.
Quick Cash Personal Loans is on a mission to bring you the most relevant news on credit cards, signature loans, debt reduction and money saving tips.