Do You Owe Back Taxes? You May Qualify for an IRS Payment Plan to Eliminate or Reduce Your Tax Debt

So you owe the IRS back taxes?When you submit a request to the IRS for a payment
Here are a few tips to help you with your situation:plan, you will have a better chance of success if you:
DON'T put the letters in a drawer and hope they will
go away.1. Make the offer so that the IRS will be paid off in 2-5
They won't.years.
Open the letters and see what they want.2. The monthly payment you offer must be equal to or
You may feel helpless and frightened and think yougreater than what the IRS figures they could collect
can't pay anything, especially in these tough economicfrom you with a negotiated agreement held in their
times. You will feel so much better when you look atoffices.
your reality and move toward a resolution.3. The monthly payment you offer must be based on
If it's a "demand" (that you pay) letter, you haveexisting IRS criteria: Subtract household living expenses
several ways to proceed.from your total income. Send the difference to the IRS.
If you are behind on your personal income taxes, those4. Make the payments. If an emergency occurs,
may be discharged in bankruptcy. If you don't want tomaking a payment impossible, contact the IRS
(or can't) file bankruptcy, consider a payment plan.immediately and work out an alternate arrangement.
A payment plan has several benefits to you. UponThere are several companies that will negotiate with
acceptance of your plan, the IRS ceases all collectionthe IRS for you for a fee. Make sure they offer to do
action, stops seizures of your cars, home orthe above for you and that they don't make wild
garnishment of your wages and/or bank account andpromises. That's unrealistic and all they will do is
the interest and penalties stop accruing (you have tofraudulently take your money.
ask to be sure it's being done).