Tax Negotiation

Tax Negotiation

Negotiating with the IRS does not have to be a terrifying ordeal. The initial thought of long wait times and filing paperwork may seem daunting at first. A knowledgeable tax professional has the tools necessary to negotiate with the IRS. You may even be able to pay far less than what you owe or have the taxes completely forgiven. A tax professional will walk you through the negotiation process with the IRS.

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Installment Payment Agreement

Part of the negotiation process is informing the IRS collectors that you are incapable of paying the full sum of your tax liability at once. They do whatever it takes to receive their money.  Your assets and income may be at risk of an IRS seizure. A tax professional may prevent asset seizes and make payments easier on you. You would simply fill out the correct forms to remain compliant with the IRS. A tax professional can create a payment plan that eases you into a financially stable life.

Partial Payment Installment Agreement

A partial payment installment agreement is a tax liability reduction. After the IRS confirms the partial payment agreement, your monthly payment arrangement begins.

There are two forms to fill out to make this agreement happen

Form 9465

A request form that tells the IRS you wish to make a monthly payment plan.

Form 433-F

Explains your financial situation with income, assets, and expenses. This tells them whether you are able to fulfill your obligations or not. A tax professional may represent you to negotiate how much the total tax responsibility reduces. From there, they may arrange your monthly payment so that you are not debilitated by IRS payments.

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Offer in Compromise

An Offer in Compromise is the best possible negotiation program. However, it is also the most difficult to get approved for. While you may negotiate with the IRS on your own, the success rate is significantly lower. If you were to receive the help of an experienced tax professional, your success rate is higher. The approval rate is already 3-5% successful. Over 90% of that is due to the thorough knowledge of a CPA or enrolled agent at a tax resolution firm.

There are a couple of scenarios that the IRS considers when they receive an Offer in Compromise. These scenarios are either IRS user error or the possibility of collection.

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Doubt as to Liability

A tax professional may determine that the IRS made an error. This doesn’t mean that your tax responsibility will be completely forgiven, but the amount assessed may change. A tax professional will be able to see how much you owe based on your financial statements. This opens up the possibility of negotiating with the IRS to pay what you actually owe, if applicable.

Doubt as to Collectibility

In this scenario, you must be able to prove to the IRS that you will never be able to pay your tax obligation in full. Reasons may include financial hardship, limited to a specific income, or outside factors. An Offer in Compromise agreement is made easy by professional tax help. You must fill out paperwork that supports your financial background to show you qualify for an OIC. Due to the low acceptance rate, we recommend a tax professional walk you through the process. An America’s Choice Tax professional will increase your chances of approval.

Tax Penalty Abatement

There are situations where you are able to pay your tax obligation but do not wish to have the tax penalties attached. As long as you provide a compelling reason, you may receive assistance. 

Qualifiers include

Financial Hardship

To qualify for financial hardship status, you must fill out Form 433A–Collection Information Statement for Wage Earners and Self-Employed Individuals. You may qualify for a temporary pause on your taxes and your financial status may be re-evaluated each year. This gives you and your tax professional time to create a plan of action to reduce or lift your tax obligations.

Statute of Limitations

The statute of limitations is the amount of time that the IRS has to collect your federal income taxes. Typically, the statute of limitations is ten years. Depending on specific circumstances, it can be longer. The time does not begin until the IRS has assessed your tax liability and sent you a notice. It could be several years until you receive a tax notice.

In some cases, you may wait out the statute of limitations until your taxes disappear from the system. To increase your likelihood of success, you need a tax professional to assist you. It is imperative that you maintain communication with your tax professional and the IRS to remain lawfully compliant.

Tax negotiation is possible. America’s Choice Tax eliminates the stress of owing taxes by examining all avenues of your tax situation. We guarantee that you’ll receive the resolution you qualify for or your money back!

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