I don't know if this is what I should do or not. I owe the taxes (over $50,000.00) and I have tried to work with them to set up payments but they won't more than I can afford monthly and they are about to levy my bank accounts and wages I'm affraid. Please give me any info you can, and also I would like to hear from some that have done this before. Thank you.
2007-07-25 04:04:10 · 6 answers · asked by Jen Jen 2 in Business & Finance ➔ Taxes ➔ United States
you have two choices that you can try doing with the IRS. One is the offer in compromise, which basically you and irs agree how much you will pay on the debt that you owe to the irs, you pay less than the full amount that you owe. This however is based on the assets that you have. If you have a lot of assets the irs is typically not going to be willing to do an offer in compromise. The other option is an installment where you pay off the debt over time. Form 9465 is this form. You fill it out indicating how much you can pay immediately, and then how much you can pay monthly. The irs will either accept this or reject it, and there is a fee for this arrangement. The irs will also send you a statement at the end of the year saying how much you've paid and how much more you have to pay. And interest will be still accruing while this is going on. I've attached links to both of these options for you.
2007-07-25 04:46:51 · answer #1 · answered by Anonymous · 0⤊ 0⤋
You might also consider filing Chapter 13 bankruptcy. It will not eliminate your tax, but it will take the decision making out of the hands of the IRS collection agent. You will file a repayment plan with the court that you can live with, and have up to five years free of IRS hassle. The bankruptcy trustee is generally more lenient than an IRS collection agent would be, and IRS would be barred from any liens or levees as of the second you file your petition with the court. If you can't pay off all your debt by the end of the allowable period, the balance will still be owed; but you will have bought yourself a lot of time, and the amount owed will have been reduced by the amount of your payments to the court.
I had a client that had been notified by the IRS collections section that they were planning on seizing his business assets, and auctioning them off for his back tax debt. He filed a Chapter 11 (business) bankruptcy, kept his business, paid off the back taxes, and is doing well today. IRS had reached the end of their patience with him, and there was no other option if he wanted his business to continue.
A Chapter 7 Bankruptcy will not accomplish anything more than postponing collection a few months, but a Chapter 13 or Chapter 11 can go a long way in getting the IRS off of your back.
Good luck.
2007-07-25 09:24:42 · answer #2 · answered by Hoosier Tax Guy 1 · 0⤊ 0⤋
The following link will take you to the IRS form that you need for an offer in compromise. It provides instructions that are not difficult to follow. However the idea is that you give them everything that they could have taken and prove to them that they would not be able to get any more. That is the compromise that they are willing to accept. The good news is that it stops the interest on what you owe while you are in this process. You will find that the IRS idea of what you can "afford" is not the same as you might have. So here is the link. Good Luck!!
http://www.irs.gov/pub/irs-pdf/f656.pdf
2007-07-25 04:20:45 · answer #3 · answered by ? 6 · 0⤊ 0⤋
I guess you mean a compromise offer. I know money is at a premium, but I really believe that a screening with a tax attorney
might save you money in the long run. You are past the point of
handling this problem successfully. This happened to a good
friend. He basically took a compromise, and now he is struggling. Of course he did not take care of the problem when he should have, so this was kind of like punishment. Go to see
a tax lawyer. Or ask your question under Answers Legal and Laws section. Goodluck
2007-07-25 04:12:05 · answer #4 · answered by nutsfornouveau 6 · 0⤊ 0⤋
Contact a CPA or EA in your local area and find one that has experience filing OIC's. Whatever you do, do not call one of the firms that advertises on TV or Radio. Their upfront fees are in the thousands and they are no more of an expert than a CPA or EA.
You will need to come up with a listing of EVERTHING that you own. If your assets (including equity in your home) along with your future earning power exceed the tax bill, the OIC will be denied. OICs are based on ability to pay, not willingness to pay. The IRS has up to 2 years to decide on an OIC and they say NO over 80% of the time.
2007-07-25 04:17:06 · answer #5 · answered by Wayne Z 7 · 1⤊ 0⤋
It depends..
2016-08-24 09:49:51 · answer #6 · answered by Anonymous · 0⤊ 0⤋