I was out of work nearly a whole year (2005). I had some stock options that I had to exercize or lose, so I exercized them. The result was what appeared to be a $40,000 gain and after all was said and done, I owe them nearly $5,000. I have not been able to pay them so far this year. I got an extension, but I haven't heard from them yet. Who would I have to call to ask that the debt be forgiven?
2006-12-21 10:18:08 · 12 answers · asked by lowesman4e 1 in Business & Finance ➔ Taxes ➔ United States
The IRS can forgive tax due but not penalties or interest accrued. Bottom line, even if they forgive your tax due, you will still owe something. The best thing to do is to call your local IRS office before they contact you and let them know your situation. Chances are they will be more lenient on you than if you wait for them to issue you a notice of deficiency. Or you can contact a reputable tax accountant and have them deal with the matter on your behalf. Good luck.
2006-12-21 10:23:38 · answer #1 · answered by snowkitty 1 · 2⤊ 2⤋
They do sometimes forgive debt under certain circumstances, such as a husband who sticks a wife with a tax bill then takes off on her, but in your case, it sounds like you will need to pay the amount due because you did realize a substantial gain. Best to call the IRS and discuss your situation, then they can set up a payment plan. If you show a good-faith effort to repay, they may not be so hard on you.
p.s. If you got an extension, you don't wait to hear from them, you just file by the extended due date. And the tax should have been paid by the original due date, usually April 15, 2006 in this case.
2006-12-21 19:01:10 · answer #2 · answered by crazydave 7 · 1⤊ 1⤋
You know, the firm I work for has gained a lot of new clients over the past year because people thought they owed on the exercise of stock options. Have you spoken to a CPA or Enrolled Agent? If not, please consider doing so as soon as possible.
Tax debts can be forgiven, but it is a one-time deal and not worth it for $5,000.
2006-12-21 18:45:54 · answer #3 · answered by skip 6 · 0⤊ 1⤋
One thing is certain, death and taxes. No the IRS will not forgive you for your debts. You can make arrangements with them to pay off the bill in payments. They WILL charge you interest on the amount owed. The best thing I can tell you is to take out a loan, and pay the IRS off. It's cheaper that way. Best of luck to you..........
2006-12-21 18:21:44 · answer #4 · answered by cajunrescuemedic 6 · 0⤊ 1⤋
They are not going to forgive you. Contact them and arrange a payment schedule. You need to pay them off as quickly as possible. The longer you let it go the more interest/penalties are charged. Take out a loan if necessary. You do not want Uncle Sam as a creditor.
2006-12-21 18:22:33 · answer #5 · answered by rkoblitz 6 · 0⤊ 1⤋
Just for the record. Extensions give you more time to file your return, not to pay your taxes. Your best bet is probably an installment payment agreement. The IRS can negotiate an "Offer in Compromise", but I doubt you are eligible.
2006-12-21 18:39:43 · answer #6 · answered by STEVEN F 7 · 1⤊ 1⤋
Never....they will hunt you down and make you pay every cent...there ruthless, cunning, they will never stop....THEY JUST KEEP COMING!!!!!!!! You don't have to call anyone, they will find you and they will make you pay...oh yeah......you will pay!!!
Only ceo's and executives that work for huge companies they can't find.....but you , you peasant they will find and make you pay! I may have gone overboard a little.....this is a sore spot.....never mind!
2006-12-21 18:46:25 · answer #7 · answered by Anonymous · 0⤊ 0⤋
The IRS has been known to negotiate reductions but, more likely, they would be willing to negotiate a payment schedule.
2006-12-21 18:21:06 · answer #8 · answered by Dave P 7 · 1⤊ 1⤋
They might have, but in your case I would say pay up.
2006-12-21 18:21:15 · answer #9 · answered by Floyd B 5 · 0⤊ 1⤋
Contact a very good CPA and they will help you. DO NOT TRY TO HANDLE IT YOURSELF.
2006-12-21 20:34:09 · answer #10 · answered by Chrisusc 2 · 0⤊ 2⤋