Johanna and Ian are small business owners doing fairly well for themselves. Things have taken off, and their website is getting more clicks every day. Tax season is just around the corner, and they’ve received notice from the IRS that they have a debt they need to settle. Johanna panics as she reads the notice. She can’t believe what she’s seeing! Neither she nor Ian has any sort of experience when it comes to dealing with the IRS. After some discussion and a quick Google search, the pair discovered tax resolution and learned how it could help them.
What is Tax Resolution?
To begin understanding the benefits of tax resolution, we need to ask ourselves one fundamental question. So what is it, and how can it help individuals or small businesses settle IRS debt and avoid penalties? Tax resolution helps companies, small businesses, and individuals settle tax problems by working with a tax resolution specialist, typically a certified accountant, enrolled agent, or tax attorney who represents them in IRS matters. The goal is to help you rectify any tax debt your business has incurred, and what the strategic response is for a business that finds itself in this scenario.
Your tax resolution specialist acts as your advocate, handling complex IRS negotiations. They guide your business toward the best possible outcome. Their skills include negotiating settlements, removing tax liens and levies, stopping wage garnishments, setting up payment plans, and addressing unfiled tax returns.
What is the Need for Tax Resolution?
Many Americans struggle each year with taxes and IRS debt. They owe more than $130 billion collectively, yet many don’t fully understand their rights or how to effectively negotiate with the IRS. Tax resolution specialists work year-round, making them a great resource for those who need immediate help with IRS payments. They help stop debts from snowballing and assist with organizing finances beyond regular tax season. At the barest bones, it helps provide a path out of debt through various means of debt elimination.
How Can Tax Resolution Support Me?
It’s not always feasible for a taxpayer to pay what is owed in its entirety right out of the gate. Not all hope is lost! There are several ways you can disperse what you owe and reduce payment amounts for a period of time. For example, you could file an Offer in Compromise with the IRS. This essentially is an offer that meets or exceeds the reasonable collection potential at this current time.
Another option is to file your tax debt under the Currently Not Collectible status. This isn’t an ultimate excuse to not pay taxes, but the IRS will pause the account, and won’t begin wage garnishing or asset seizures at this time. Instead, the IRS will file a tax lien and re-evaluate the situation every 12-24 months. This account, however, may accrue interest if not paid in a timely manner.
Installment agreements are monthly payments that reduce the total tax debt owed. They will establish an agreed-upon limit, timeframe, and interest rates for each payment. With these installment agreements, it’s important to note that just like with typical loans, penalties can occur for any missed payments.
Lastly, penalty abatement offers relief by reducing the amount owed on late taxes if the IRS agrees to remove the associated penalties. However, this form of tax resolution requires a reasonable cause for the delay in payment.
All of these methods should be done with the guidance of your tax resolution specialist.
How DeMar Consulting Group Can Help
After researching, Johanna and Ian made a few calls and contacted a tax resolution specialist. With their help, the pair was prepared to negotiate with the IRS and discovered how to deal with an unsuspected debt. As a result, tax season won’t be so scary now that they know there are programs and aid available.
At DeMar Consulting Group, we specialize in navigating the complex world of IRS negotiations and tax resolution services. Whether you face back taxes, liens, or unfiled returns, our professionals can help you create a personalized strategy to regain control. From Offer in Compromise filings to penalty abatement and payment plans, we act as your advocate every step of the way. Schedule a free consultation today and discover how tax resolution can work for you.
