What To Do When You Can’t Pay Taxes On Time
You know that tax deadlines roll around the same time every year but what if this year you simply don't have the money to pay your tax obligation to the IRS? The only thing to do, really is to file your taxes regardless of what you owe. Not filing the taxes will not make the tax obligation go away and it can open you up to additional penalties. The IRS has the option to file penalties against you if your don't pay your tax obligation as well as penalties for simply not filing. If you at least make an attempt to pay your taxes that are due, you can avoid the non-filing penalty. If you don't have access to the amount of money you owe the IRS at least make an attempt to pay something. Paying at least a small amount will let the IRS know you are making an effort to address your tax obligation and it will also lower the amount of interest and penalties owed in the long run. Keep in mind that the more you can lower your up front balanced owe, the lower the amount of money you will have to pay the IRS at a later date. Filing your taxes on time also keeps you under the radar and opens you up to less of a chance to be the target of an audit by the IRS.
Do you have any family members or friends who might be willing to offer you a loan to pay off your IRS obligation? If so, you should turn to them before the tax filing deadline hits so you can pay your bill when it's due. You will probably be able to negotiate a lower interest payment with them than with the IRS. Additionally, look to your credit cards and see if you have enough of a credit line on them that you can use to pay your tax obligation. Check to make certain the interest rate you're charged on your cards is advantageous though. Some people look to their home mortgages or credit lines to pay their tax obligations. If this might be an option for you, talk to a tax professional to see if this is a good way for you to go to pay your tax obligation.
Talking to the IRS is a very important step to take, actually this should be one of the first phone calls that you make. Talk to an IRS agent and see if you can enter into an installment plan with them. They may be willing to let you make payments over time against the balance owed. For taxpayers who owe less than $25,000 there is an option to go online and complete an installment agreement application. Individuals who find themselves in dire financial straits that don't appear to have an end in sight, should talk with the IRS about a temporary collection suspension action. Penalties and interest will still accrue against what you owe but halting collection attempts will give you some breathing room.
Attempting to make payment arrangements with the IRS may not work in your favor and if not, there is an option to file an Offer in compromise. An OIC is not a best case scenario as it is expensive to file and the IRS typically rejects OIC agreements. These forms are not inexpensive to file and typically require the services of an attorney. If the compromise is rejected you are still liable for the price of the form's filing and the amount you owed plus penalties and interest. Don't consider this option until you have exhausted your other options and having talked to your tax professional.
Remember, no matter what direction you take, you can't avoid the IRS and the money that you owe. You need to face your obligations head on as they will not go away. Talk to a tax professional as a way to face the obligations and avoid an IRS audit.
Experiencing tax problems with the IRS? Contact Guardian Tax Resolutions. The Guardian will help you resolve your tax issues with the IRS.
Related posts:
- 5 Tax Myths to Avoid
- Implications Of Tax Burdens And And Filing Bankruptcy
- The Relation Between Bankruptcy And Taxes
- Solution to Back Taxes
- What To Do With A Tax Refund
- Still Got Unpaid IRS Taxes? – Tax Time Again
- Tips For Various Opportunities For IRS Debt Relief In Today’s Society
- What You Need To Know When Filing Your Taxes This Year
- Can You File Taxes Owed With Bankruptcy?
- Tax Tips To Make Filing Easier This Year