The deadline is fast approaching for people in Tennessee to file their taxes. Some people may look forward to this time of year if they receive refunds from the IRS, but this is not true for many others. Many individuals will owe taxes when they file their tax returns or may owe taxes for past years. It is not a fun experience to owe taxes to the IRS, though, as they are the most powerful collection agency and generally make sure that they get what people owe.
However, in certain circumstances the IRS is willing to work with people so they can pay the tax debt that is due. There are multiple options that the IRS offers for repayment, such as installment agreements, but sometimes it gets to a point where a person simply will not be able to pay the taxes they owe, even over time. In these situations, an individual may be able to enter into an Offer in Compromise with the IRS.
An Offer in Compromise is an agreement with the IRS to pay back less than the total amount a person owes. The IRS will evaluate an individual’s economic situation and then negotiate the total amount a person will have to repay.
The basic process is that the person will submit their offer, which will be reviewed by the IRS. Along with the offer, the taxpayer will also have to submit an initial payment. While the IRS is reviewing the offer, the person is required to make payments in accordance with their offer, but other collection efforts will be suspended. If the offer is accepted, then the person must follow the repayment plan. If it is not accepted, then the person has 30 days to appeal it.
Many individuals in Tennessee dread this time of year when they know they will owe money to the IRS. If possible, it is best to pay the amount owed, but this is not an option for everyone. That is why the IRS offers options for repayment to allow people to repay without forceful garnishments and other penalties. Experienced attorneys understand the options and processes for repayment of tax debt and may therefore prove to be a useful resource for those seeking to successfully navigate the system.
Source: IRS, “Offer in Compromise” accessed on March 19, 2018