Can I Do My Bargaining?
The IRS is open to negotiation, to put it briefly. Tax settlements may be accomplished by direct communication with the IRS; however, taking advantage of a free consultation from an expert is an excellent approach to secure a settlement that you can live with. It might be challenging to decide whether to handle your tax situation on your own or to hire an Enrolled Agent or skilled Tax Negotiator who has been recognized by the IRS. However, the success of negotiating with the IRS and the size of your settlement may be greatly improved by working with an expert.
What is the IRS’s settlement offer?
Maybe not as much as you’d imagine! The Internal Revenue Service uses agents to pursue tax debtors. Everyone intends to raise tax rates and amass as much money as possible. To accomplish their objectives, they will make use of any resources at their disposal. This usually results in a worse bargain for the taxpayer. A tax negotiator’s job is to negotiate with the IRS for a settlement that reduces your tax burden as much as feasible and sets up a payment plan that you can stick to so you can pay off the rest.
Is there any chance of a negotiated settlement being offered to me?
The final aim of your discussion should be a resolution to your tax burden that you can accept and afford. As unpleasant as it may be, sometimes you need to take action and that action may include liquidating assets, such as selling personal property or withdrawing funds from retirement accounts. An Offer in Compromise is the term for the settlement you seek (OIC). It’s just an arrangement between you and the Internal Revenue Service to pay back less money in taxes. A “Fresh Start” is another name for this program. You may be offered the choice of making one large payment to settle the debt or setting up a monthly payment plan. Both the amount and the number of months over which the IRS will accept payments are specified in its guidelines. Keep in mind that YOU are the one making this offer, and the IRS may accept or refuse it at their discretion.
Filling out IRS Form 656 for an Offer in Compromise can help you figure out how much you can afford to pay in tax penalties and interest. A skilled tax expert may make a world of difference in this respect. The IRS will charge you $150 for processing your application. A rejected offer or a mistaken assumption might be quite expensive. There is no tax to pay on the $150. The only cost involved is the application’s one-time charge.