Tax Debt Settlement
Debt settlement has become a popular approach to resolving problem debts without having to file bankruptcy. With this approach, creditors agree to accept a portion of what you owe (usually around 50% or less) to settle the account, and the remaining balance is forgiven. This technique will certainly continue to grow in popularity now that the new bankruptcy law makes it tougher to fully discharge debts in a Chapter 7 bankruptcy.
An IRS payment plan is the most common form of tax settlement. Once your payment plan is accepted by the IRS you will be considered to be back into good standing with them. The most common form of payment plan is an installment agreement. With an installment agreement you will be able to pay back the taxes owed in monthly increments over a period up to 3 years.
IRS tax debt settlement help is available to anyone who finds they owe money to the IRS. There are many reasons people owe the government. Improper filings, failures to pay payroll taxes and penalties for non-payment are all reasons the amount owed can add up quickly. The government has many programs that can assist the taxpayer repay money due. These services charge fees bases on the amount of time necessary to settle the case. They know the ins and outs of the IRS programs and therefore can often save you hundreds if not thousands of dollars in penalties and late fees.
If you are interested in tax debt settlement you are probably in a bad situation. That being said, things may not be as bad as you think they are. With a lot of tax debt settlement options you can usually find something that will work for you. Remember, once you find something that works you can be well on your way to getting out of debt in no time at all. It is very important that you do not waste anytime when searching for a tax debt settlement method.
What is an OIC?
Simply put, an OIC is a settlement agreement between a taxpayer and the IRS. Like any creditor, the IRS recognizes that not all accounts will be paid. Rather than letting a debt become uncollectable, the IRS opts to accept less money than is owed in certain circumstances.
Offer in Compromise – Offer to Pay a Small Percentage of Unpaid Taxes
An offer is made to pay the ‘reasonable collection potential’ and not all unpaid taxes. Whilst this may seem like a panacea, only a small percentage of offers are actually accepted. Should it be possible to clear debt via an instalment plan, this form of IRS tax debt settlement help will not be available. It can be a highly complex area so the majority of people choose to utilise the services of a tax professional.
Now that you know some of the most popular methods for settling tax debt you can begin to think about how to best move forward. With the right tax debt settlement option you are closer than ever to getting on the same page as the IRS.