Realizing that you have IRS debts can be devastating. The IRS heavily penalizes back taxes, and often the fines and penalties are more than the original debt. Facing the IRS to resolve a tax issue can be intimidating, but it is possible. You can approach the IRS for tax relief yourself, or through a tax attorney or agency.

When approaching the IRS for a tax reduction you should keep in mind that the process will not easy. The agency does not like to reduce debts; they believe that taxes and penalties are owed regardless. However, they do have set guidelines for reduction of debts and repayment plans available to help individuals take care of their past due taxes.

Do You Owe $10,000+ To The IRS?

If you are using the services of a tax attorney or tax relief service, you may be able to reduce your burden even further. These services often dispute the findings of the IRS and can prove how the accounting methods were inaccurate. When this happens, the IRS will reduce the taxes that are owed and the accompanying fines. These companies can also negotiate with the IRS on a repayment plan that will fit your current budget.

An IRS tax settlement will include an account set up fee, unless you are paying the debt in full. The IRS will require you to pay the account set up fee and the first monthly payment within thirty days of the initial agreement. If the fee and payment are not received within the time frame the IRS will consider the contract void.

Your settlement will continue to accrue interest while you are making your payments. During the repayment period you will not be eligible to receive any federal returns until your debt is repaid. If you are eligible to receive a tax return, the amount that is due will automatically be applied to your debt. Once your debt is repaid you begin to receive your tax returns again.

Every person facing this situation must realize that time is of the essence. The IRS charges incredible interest on their debts, and the longer you wait to resolve the problem the more you will pay. It is important that the instant you receive notification that taxes are owed you respond to the letter.