An offer in compromise can put IRS troubles behind you and bring a fresh start on your taxes. But the road to a fresh start with the IRS is not necessarily as simple as it may sound. The IRS has very strict criteria that they use to determine if a tax debt should be compromised. Before jumping in with a compromise, there is much you need to know about the IRS settlement process, including: - Whether you should even file an offer in compromise. For example, if the IRS has a limited time left to collect your debt (out of the 10 year period they are given by law), should you jump ... Read More
How long will an IRS currently not collectible status last?
Currently not collectible status protects you from the IRS, stopping levies, threatening letters and collection enforcement. It forces the IRS to simply leave you alone without requiring any payment on your end. The IRS will consider your account to be currently not collectible if we provide them a collection information statement verifying that there would be a financial hardship if the IRS forced you to pay them. To the IRS, currently not collectible is "putting a debt on the shelf" - they take your case out of their active collection inventory (shelving it). The Treasury Inspector ... Read More
Dealing with the IRS Automated Collection Service? Know what to expect.
The IRS has two main sources of carrying out its work in collecting taxes: local Revenue Officers and its Automated Collection Service. When you get that call or letter from IRS collections, it's important to know who you are dealing with - and what to expect. The IRS Automated Collection Service - commonly known as "ACS" - is a series of IRS call centers staffed by IRS collection employees. You will never see or meet an ACS employee face-to-face; all of their work is conducted by telephone. And the vast majority of telephone work conducted by ACS is responding to inbound calls, not ... Read More
An IRS letter that you want to receive: Case Closed – Currently Not Collectible
There are many options to resolve an unpaid tax liability - you can agree with the IRS to make monthly installment payments, reach a settlement with an offer in compromise, eliminate the taxes in bankruptcy, or have the IRS place your account in currently not collectible status. Let's focus on currently not collectible. Currently not collectible status occurs when the IRS agrees that you cannot afford to repay the debt, and doing so would create an economic hardship on you. It is forbearance by the IRS, a break from enforcement that can last years. To obtain currently not collectible ... Read More
Life after an IRS audit: What to expect next on the balance owed
Making it through an IRS audit is stressful and anxiety ridden, but for many, it is not the end of the road in dealing with the IRS. Many IRS audits result in balances due. Here are my responses to great questions from a reader about dealing with IRS collections after the audit. I just finished an audit covering three years ... 08-09-10...and owe the IRS over $100,000. My questions are: Will the IRS do a payment plan? Would they take a lump sum and forgive the balance? And will a lien be put on my property as part of the payment negotiations? To begin with, after the IRS concludes the ... Read More