People who have large tax debt are often in the unenviable position of having to negotiate with the Internal Revenue Service. If you fall into that category, don't worry, because there is a reliable course of action open to you. The number one priority is to hire someone to represent you in your dealings with this most humorless government agency. Consider either an attorney or a CPA, but in any case do not represent yourself. People with tax problems who try to cut corners and act as their own representatives face a very low success rate in reducing IRS debt.
But after your representative comes on board, you will play a proactive part in resolving your case by providing information, documents, and explanations about the situation. Perhaps the most common question taxpayers have is whether the IRS will negotiate at all. The answer is a resounding yes. Not only will the IRS negotiate, but if you take the proper steps, act in an honest manner, and get good representation, then your final payment to the government could be much less than originally tabulated. The key is preparation on your part.
Maybe you will have to rummage through old paper files or computer documents. If that is the case, do it. Turn everything over to your representative and be completely honest about the entire situation. If you think a bit of dishonesty will help cover up your problems, think again. Millions of taxpayers who have tried to trick the IRS have ended up with whopping tax bills or worse, jail time. Anything other than 100 percent honesty will certainly come back to haunt you later on.
Keep in mind that if you have a big tax bill, there is a bit more room to negotiate. With a very small bill, there is obviously less wiggle room. The government is usually more than satisfied to walk away from the negotiating table with a solid assurance of something, rather than a weak assurance of a large settlement. That is one reason the agency is so willing to accept "offers in compromise" on a regular basis. They realize many people cannot afford to pay the entire tax bill. The old saying comes into play, namely, "A bird in the hand is worth two in the bush." The IRS will often take 10, 20, or 30 percent of the entire bill. Alternately, the government tax service is known to commonly write off penalties and interest if you are willing to pay a portion of the original default amount.
Remember to be honest, get good representation, and do everything you can to help your attorney or accountant prepare your case. The IRS is willing to negotiate in almost every tax dispute.
But after your representative comes on board, you will play a proactive part in resolving your case by providing information, documents, and explanations about the situation. Perhaps the most common question taxpayers have is whether the IRS will negotiate at all. The answer is a resounding yes. Not only will the IRS negotiate, but if you take the proper steps, act in an honest manner, and get good representation, then your final payment to the government could be much less than originally tabulated. The key is preparation on your part.
Maybe you will have to rummage through old paper files or computer documents. If that is the case, do it. Turn everything over to your representative and be completely honest about the entire situation. If you think a bit of dishonesty will help cover up your problems, think again. Millions of taxpayers who have tried to trick the IRS have ended up with whopping tax bills or worse, jail time. Anything other than 100 percent honesty will certainly come back to haunt you later on.
Keep in mind that if you have a big tax bill, there is a bit more room to negotiate. With a very small bill, there is obviously less wiggle room. The government is usually more than satisfied to walk away from the negotiating table with a solid assurance of something, rather than a weak assurance of a large settlement. That is one reason the agency is so willing to accept "offers in compromise" on a regular basis. They realize many people cannot afford to pay the entire tax bill. The old saying comes into play, namely, "A bird in the hand is worth two in the bush." The IRS will often take 10, 20, or 30 percent of the entire bill. Alternately, the government tax service is known to commonly write off penalties and interest if you are willing to pay a portion of the original default amount.
Remember to be honest, get good representation, and do everything you can to help your attorney or accountant prepare your case. The IRS is willing to negotiate in almost every tax dispute.
About the Author:
Seeking tax relief from the IRS? Contact Guardian Tax Resolutions. The Guardian will help you resolve your tax issues and get you the piece of mind that you deserve.