What Is an IRS Settlement?
Dealing with the Internal Revenue Service (IRS) is a daunting task. The IRS is a federal agency responsible for collecting taxes and enforcing tax laws. As part of its tax-collection role, the agency can seize your assets, garnish your wages, file liens against your property, and levy your bank account in cases where you owe taxes. Discover more pertinent details about the topic in this recommended external site. Know this, obtain supplementary information and fresh viewpoints that will enrich your study and understanding of the subject.
If you owe tax debt to the IRS, one way to deal with it is through an IRS settlement. An IRS settlement, also referred to as an Offer in Compromise (OIC), is a program that allows you to settle your tax debt for less than you owe.
What Are Your Options for Settling with the IRS?
If you owe tax debt to the IRS, you have several options for settling your debt.
Offer in Compromise (OIC)
An Offer in Compromise (OIC) is the most common option for settling tax debts. With an OIC, the IRS allows you to settle your tax debt for less than you owe. To qualify for an OIC, you must meet certain criteria, including:
Once you file an OIC, you agree to pay a lump-sum payment or make payments over time. If your offer is accepted, you’ll avoid the penalties and interest that would have accumulated on your tax debt.
If you can’t pay your tax debt in full, you may be able to set up an installment agreement with the IRS. With an installment agreement, you make monthly payments over a set period of time until your tax debt is paid in full.
The IRS will approve your installment agreement request if:
Partial Payment Installment Agreement (PPIA)
A PPIA is a payment plan that allows you to pay a portion of your tax debt over time. To qualify for a PPIA, you must demonstrate that you can’t pay your tax debt in full through an OIC or an installment agreement.
The IRS will approve your PPIA request if:
How to Choose the Best IRS Settlement Option for Your Needs?
Choosing the right settlement option for your tax debt depends on several factors, including:
Before you decide on a settlement option, it’s best to consult with a tax professional who can analyze your specific situation and recommend the best option for you.
The Bottom Line
If you owe tax debt to the IRS, settling your debt can help you avoid penalties and interest and get your finances back on track. The settlement options available to you include an Offer in Compromise, an installment agreement, and a Partial Payment Installment Agreement. By choosing the right IRS settlement option, you can put your tax debt behind you and move forward with your life. Keep advancing your educational experience by exploring this suggested external material. https://Www.helloresolve.com/, you’ll encounter useful knowledge and extra details on the topic.
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