A lot of people, who owe the Internal Revenue Service money, think they can file an extension, without writing a check, and buy some time. This is not true. Not filing isn't an option for most. Avoiding their notices in your mailbox will not make them go away. It is possible to make arrangements to pay back what you owe. It can be complicated however. The laws on tax debt offer in compromise New York tax payers apply for may save you a lot of money and headaches.
This government program is designed to help taxpayers settle their outstanding debt with the government. Those who qualify come to a satisfactory agreement with the agency to repay a portion, instead of all, of the money owed. Not everybody can take advantage of this program. The IRS looks at thousands of cases each year and only approves about forty percent.
There are basically two repayment options. If you have the money, or can find a way to borrow it, you might choose the lump sum payment. This plan has the taxpayer repaying the total agreed upon amount within five months of the date of IRS approval. Twenty percent of the payment is required when the application is submitted. You will not get this money returned if your application is denied.
The periodic payment is the second option. You have longer to repay the debt than with the lump sum plan. You can stretch this repayment plan to two years. You must make the initial payment along with the application. As with the lump sum plan, this initial payment does not mean your application will be accepted, and will not be returned to you if you are denied.
There is no point in wasting your time applying for this program unless you have a chance of approval. First you have to convince the Internal Revenue Service that you won't be able to pay what you owe within ten years, which is the maximize time the government has to collect money owed. To convince them, your assets and cash on hand must be minimal, or non-existent.
The second consideration is that you have the money to repay the government, but paying in full will be an economic hardship for you. You can bet that what you consider hardship and what the IRS considers hardship will not be one and the same. Thirdly, there is a real possibility that you don't really owe the money, or you owe them money but the amount is in question.
It is very important to understand how the amount you pay back, if you are approved, is determined. They have formulas they use to determine what you can reasonably afford to pay. Once they come up with a number, you are allowed deductions and exemptions. Your best bet is to downplay the value of your assets and come up with as many acceptable living expenses as you can.
Nobody wants to be in a position of having to negotiate with the IRS. The best way to avoid it is to pay what you owe on time. Negotiating a settlement is your next best option.
This government program is designed to help taxpayers settle their outstanding debt with the government. Those who qualify come to a satisfactory agreement with the agency to repay a portion, instead of all, of the money owed. Not everybody can take advantage of this program. The IRS looks at thousands of cases each year and only approves about forty percent.
There are basically two repayment options. If you have the money, or can find a way to borrow it, you might choose the lump sum payment. This plan has the taxpayer repaying the total agreed upon amount within five months of the date of IRS approval. Twenty percent of the payment is required when the application is submitted. You will not get this money returned if your application is denied.
The periodic payment is the second option. You have longer to repay the debt than with the lump sum plan. You can stretch this repayment plan to two years. You must make the initial payment along with the application. As with the lump sum plan, this initial payment does not mean your application will be accepted, and will not be returned to you if you are denied.
There is no point in wasting your time applying for this program unless you have a chance of approval. First you have to convince the Internal Revenue Service that you won't be able to pay what you owe within ten years, which is the maximize time the government has to collect money owed. To convince them, your assets and cash on hand must be minimal, or non-existent.
The second consideration is that you have the money to repay the government, but paying in full will be an economic hardship for you. You can bet that what you consider hardship and what the IRS considers hardship will not be one and the same. Thirdly, there is a real possibility that you don't really owe the money, or you owe them money but the amount is in question.
It is very important to understand how the amount you pay back, if you are approved, is determined. They have formulas they use to determine what you can reasonably afford to pay. Once they come up with a number, you are allowed deductions and exemptions. Your best bet is to downplay the value of your assets and come up with as many acceptable living expenses as you can.
Nobody wants to be in a position of having to negotiate with the IRS. The best way to avoid it is to pay what you owe on time. Negotiating a settlement is your next best option.
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