IRS Debt Relief - What Are Your Tax Debt Options?

Being in debt to the IRS is a rough situation. It may even not be your fault, but nonetheless you you need IRS debt relief. There are lots of ways to find relief from the taxman and we will outline a few of them here. There is help to be had, and lots of people who offer it. There is generally two directions to go; directly to the IRS or to a tax professional/attorney. It helps to have a tax attorney to assist you through the bureaucracy and go to bat against the IRS, but it will cost quite a bit of money. The main advantage of a tax attorney is they can work to significantly lower the amount you owe. Calculate how much you will spend versus how much you save to see if it's cost effective.

One of the best methods of IRS tax relief is to be able to prove that it was not your fault. If you received bad tax advice or made the same computation error on your taxes each year, note that down and figure out a way to prove it.

Let's take a look at a few ways for you to get IRS debt relief.

We must have missed this sign... Image courtesy of Paul Keleher via Flickr.
We must have missed this sign... Image courtesy of Paul Keleher via Flickr.

IRS Debt Relief From the Government

You can bring your case directly to your local IRS office and there will be someone there to help you with IRS debt relief. From all accounts, the service and level of helpfulness is extremely hit or miss at the IRS office. Some report that they were able to resolve all of their issues and others were ready to jump off a cliff after they left. Good luck!

There are lots of things that the IRS can do for you. The IRS offers a program called Offer In Compromise that allows you to pay only a fraction of the taxes that you owe. As I'm sure you can imagine, this is the route that most people try to go for IRS debt relief. It's pretty difficult to be approved for this type of repayment. If you can prove that you didn't pay your taxes due to extreme financial hardship, or if paying what you currently owe can't be done within five years without causing serious financial hardship you may qualify. There are other ways to qualify for Offer in Compromise, but this is the most common.

The IRS offers other options as well. Monthly repayment is available, so is the garnishment of future wages. If you plan on taking this route, be wary that your success may depend on the person who is helping you out.

IRS Debt Relief From a Tax Attorney

Having a tax attorney or tax professional take care of the IRS for you is certainly an easier route to take than doing it yourself, but you pay for this service. If the cost of the tax pro is more than the money he or she can save you, you end up spending more money. In my opinion, though, having them deal with the IRS is worth the extra money.

A tax pro will also save you time by guiding you and your case down the correct path. These people know the tax laws and the options that are available for someone in your situation, so much of the confusion will be cleared.

If you have the money, I recommend taking this route for IRS debt relief. If you don't have the money, they still may be able to offer their advice.

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