Do you owe the IRS money? Are you worried about what to do about it? You are not alone. Let’s take a closer look at what to do about owing the IRS.
We all know that the IRS knows basically EVERYTHING about us. They know where we live, where we work, who we are married to, and they even know if we have ever written off a latte as one of our business expenses, and where we got that latte. In other words, if you owe the IRS money and they begin to look for you, there is no place you can hide. If you do try to hide, the IRS can and will not hesitate to seize your property. Then you will need the help of someone like Anderson Bradshaw PLLC. They can represent you at an IRS audit and help you with the back taxes that are owed so that your property doesn’t get seized. Additionally, the following measures can be taken to address an IRS tax debt ASAP:
Overpaying
No matter if you have a love hate relationship with tax season or not, the fact of the matter is that we have to deal with taxes throughout the entire year. Taxes come out of every one of our paychecks. The thing is, you have the power to decide how much comes out. Now, if you underestimate the amount that you will owe at the end of the year, you will end up having to pay when tax season comes around, and nobody likes to do that. If you overestimate and overpay as a result, you will have money coming back to you during tax season. This is what most people prefer. Wouldn’t you prefer the IRS owing you money to you having to pay them?
Tax Payments
According to the IRS, if you didn’t pay enough taxes throughout the year and end up owing them money, you will be expected to pay the amount of the taxes you owe plus any interest and penalties promptly. If you are not able to pay the full amount at once, they recommend taking out a loan to pay them because of the fact that it is better to pay them off at once as opposed to making payments.
Filing
This is where you will find out whether or not you will owe the IRS this year or if you will get money back. If you begin to prepare your return and come to find out that you will owe money this year, and you know that you don’t have the money to pay it, don’t just stop and not file your taxes. You will be better off sending your return in or even filing for an extension. Penalties for filing late start on April 16. They can add up quickly too. If you don’t file until 2 months after April 15th, there is a minimum penalty that will be either the entire amount of your unpaid taxes or $135, whichever amount is smaller. This fine will start to be charged interest almost immediately too.
Ask Them to be Lenient
There are certain circumstances that will allow for taxpayers to avoid paying penalties. For example, if you have always paid your taxes on time, you can ask the IRS to wave the penalty for paying late. The IRS will then look at your payment history and if you have never had a late payment penalty they will waive the fee the first time.
If you don’t qualify for that penalty to be waived the first time because you have already done that once, you can ask the IRS to waive the penalty for probable cause. Additionally, the IRS has implemented a Fresh Start Program that has been designed to assist small business owners and individuals who owe them back taxes by beginning a new installment program which will make it easier to have a lien due to back taxes withdrawn.
Get Assistance
If you can’t afford a reputable tax attorney or certified accountant, don’t worry, you still have options. There are other resources that you can look into, including those offered at your local libraries and community centers, as well as tax prep software, and even the IRS themselves. The goal of the agency is to make sure that people pay their taxes after all. It is therefore in their best interest to help you do that. Whatever you do though, don’t ignore it. It will not go well for you if you do.
