Next to medical debt, tax debt is a debt we really despise. The reason that tax debt is so despicable is that most people who have tax debt didn’t even know about it! After all, you do your best to file your taxes correctly and then you find out that you (or your CPA) missed a few things. Now, a few months past April, you’re still stuck with your tax debt, and resolving the issue requires more money than you can afford to let go of.
Tax Debt Strategies
While you can’t discharge most tax debts via bankruptcy, you can get rid of your tax debt! All it takes is a little resourcefulness. And, if you’re willing to do some research, that will take you a long way. Chances are, if you’re reading this blog post, you’re up to the challenge!
Surprisingly, the IRS is willing to work with you to resolve your tax debt issues. There are several programs available to debtors. Which one works best for you will depend upon your income, assets, and expenses. And, you won’t be surprised to find out that the IRS has some very strict guidelines with regards to all of their programs.
One of the most popular tax debt resolution strategies is the installment plan. The IRS will work with you to reduce your debt and is willing to accept monthly payments at very low interest rates. Another popular plan is the Offer-in-Compromise program. Through this program, you work with the IRS to determine how much of your debt you can feasibly repay. While it requires a lot of financial transparency, you can get a great deal!