Can’t Afford to Pay Your Taxes? IRS Offers Payment Plans and Tax Relief Options

If you can’t afford your tax bill this year, know that the IRS offers payment options for struggling taxpayers.

While individuals are urged to file their tax returns and and pay any taxes owed by April 15, the agency is aware that the economic downturn has made this difficult for many people.

Taxpayers who do not file their tax returns by the April 15 deadline may be subject to a failure-to-file penalty. To avoid this, taxpayers should file by the deadline and pay as much as they can, even if they are unable to pay the entire amount due.

Taxpayers who request an extension of time to file, should keep in mind that this is is not an extension of time to pay.

Taxpayers in difficult financial situations are reminded that they can file a tax return, pay what they can and work with the IRS to establish a payment plan that will keep them compliant.

You can contact the IRS directly for tax help, however, it may be a good idea to consult with a highly qualified tax professional first.

The IRS requires taxpayers who owe more than $25,000 to provide full financial disclosure – and individuals in this situation will need to hire specialized tax resolution experts to negotiate on their behalf. Additionally, tax resolution experts can help negotiate can arrange an Installment Agreement for the lowest possible monthly payment.

Taxpayers who cannot afford to make monthly payments and don’t qualify for another type of tax relief, such as an offer in compromise, have other tax relief options including negotiating that your account be placed in a “currently not collectible” status so that you will not be required to make payments and the IRS will not pursue collection action.

Taxpayers who cannot make a full payment by April 15 may consider applying for an installment agreement by using the Online Payment Agreement link at www.irs.gov or by attaching Form 9465, Installment Agreement Request, to the front of their tax return. A user fee will apply for an installment agreement, and the amount of the fee is dependent on the method of payment. The IRS will automatically give taxpayers the low-income installment agreement if they qualify.

** If you owe back taxes and need income tax relief, our specialized staff of attorneys, CPAs, EAs and tax professionals can help. Visit the Tax Resolution Services web site for a free tax relief consultation or call us at 866-IRS-PROBLEMS.

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This entry was posted on Monday, April 13th, 2009 at 3:44 pm and is filed under Seeking Professional Tax Help, Tax news and tips, Working with the IRS. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.