Six Common Tax Assistance Strategies to Help with Payments

It is an unfortunate reality for some of our clients: you may end up owing a large tax debt but your own circumstances make paying it impossible. So you struggle to find the funds only to face attachment, garnishment and other harsh collection methods that only make your struggle more immense. Retaining tax assistance in Des Moines, IA can help you through this so you find a better way to solve your tax problems. Here are six strategies we may use to help your situation:

  • Offer in Compromise: An Offer in Compromise allows you to settle your tax debt for an amount that’s much less than what you owe. It stops collection activity and starts you over at zero. If you are expecting a bonus at work, or another large sum of money, that is an opportunity to make an Offer in Compromise. You have to pay the entire amount if the IRS accepts your offer.
  • Penalty abatement: If there is a reasonable explanation for why you failed to pay taxes on time, the IRS can remove penalties and interest to make payment easier for you. Since these extra fees can increase your burden by 50 percent or more, securing this relief can make a tremendous impact.
  • Installment agreements: For some taxpayers, it is not a matter of lacking money, but of not having it all at once. If you bring in a regular income and can keep up with a monthly payment, an installment agreement is an excellent option. The trick is to be realistic—never promise a $500 a month payment if you are not certain of your income, or if that makes day-to-day living unreasonably tight. It may be more realistic to have a $200 a month plan and make larger payments during good months.
  • Asset protection: Seizure, levies and garnishment are all possibilities when you owe the IRS. If you have assets that are necessary for the care of a dependent or other expenses, you need to take steps to protect them. We can help you negotiate with the IRS to prevent garnishment, or advise you to consider trusts and other legal vehicles to keep these assets safe.
  • Bankruptcy help: Before you talk to a bankruptcy attorney, make an appointment with us first. If we cannot find an alternative for you, we can at least organize your records so the bankruptcy goes forward with as few setbacks as possible. Sometimes, clients truly need this relief and it can be an effective tool when there are no other options.
  • Designate your account “not collectible”: After numerous attempts to collect against your assets, the IRS may determine that your debts are not collectible. This is common for those who do not have much extra money above living expenses. If you convince the IRS that you fall into this category, collection actions will stop until it appears you have adequate income once again.

Tax assistance in Des Moines, IA can help you overcome your tax debts. Schedule a consultation at Accounting & Tax Professionals, PLC today and get started on finding solutions.

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