Monthly Archives: March 2018

IRS Forgiveness – IRS Tax Relief Options

Are there any decent IRS forgiveness programs out there?

Do you know how many Americans owe the IRS back taxes on their personal income? It might come as a surprise, but the IRS claims that over a million taxpayers owe them money.

So, how is the IRS ever going to collect on all of those back tax debts? They won’t. Not only that, but they can’t. With limited resources, a criminally understaffed employee-base, and a huge number of taxpayers with accrued debts, there’s simply no way the IRS can keep up. Because the IRS is unable to collect on all of those back taxes, IRS forgiveness programs were instituted.

Three things that are in your favor…

#1) Statute of limitations on collections: Did you know, under most circumstances, that there is a clock running on the IRS’s ability to collect back taxes from you? After the necessary time has passed, your debt is removed.

There are definitely situations where it would be more prudent to not enter into any deals with the IRS. After all, if your circumstances call for it, it’s possible you won’t have to pay back anything. If you’d like to learn when your tax debt expires without raising any red flags, click here to learn about our service that can tell you exactly what you owe and when your tax debt expires.

#2) The IRS Can’t Get “Blood from a Turnip”: There is no difference in how much you owe if you don’t have the money to cover your debts. It’s called “reasonable collection potential”. If you are dead broke — meaning you have absolutely no assets — your RCP is $0. If you were to offer the IRS more than $0, then — despite how absurd it might sound — offering the IRS $1 might be a good deal for them.

IRS Tax Forgiveness Programs

Currently Non-Collectable Status (CNC)

If your Reasonable Collection Potential is low and the assets you have aren’t worth anything or are inaccessible, you may be able to qualify for CNC. CNC means that you don’t have to make any payments to the IRS, aside from your current withholdings or estimated tax payments. CNC keeps the clock running, so if you are to remain in CNC for the duration of the statute of limitations, it’s quite plausible that you won’t have to pay the IRS anything.

Partial Payment Installment Agreement (PPIA)

An IRS partial payment installment agreement is what you may qualify for if you have too much of a Reasonable Collection Potential for CNC (in other words, when your income and assets are too high to reasonably land you in non-collectible status). An IRS partial payment installment agreement means that instead of not having to pay anything to the IRS, you will need to pay them something each month. Much like a mortgage or a car loan, you’re working on reducing your owed debt.

When entered into an IRS partial payment installment agreement, the same benefits apply as CNC — you are running down the collections clock and may get closer to being able to file bankruptcy or have the collection period expire and eliminate your debt entirely. If you think a PPIA might be the best program for your situation, it’s well worth taking the time to learn more about what constitutes a partial payment installment agreement.

If the amount you are paying does pay off the debt within the remaining collection period, that would likely be a regular installment agreement, not a PPIA. But make no mistake about it, negotiating an installment agreement may not be all that easy — the IRS much prefers to get its money sooner rather than later. It’s important to only enter into an installment agreement or PPIA that you know you can handle. Many taxpayers fall into the trap of being intimidated into a repayment schedule that they simply can’t afford.

Offer in Compromise — Doubt as to Collectability

There are a number of Offer in Compromise IRS Tax Relief options available with the IRS, but they each tend to be different beasts. The one that our IRS Tax Relief team would like to focus on is a specific type of offer — doubt as to collectability — the most common type of IRS tax forgiveness program the IRS Tax Relief team at Flat Fee Tax Service, Inc. will use to settle our clients’ IRS tax debts for far less than what is owed.

There are a number of tactics and tips for submitting a successful Offer in Compromise that the IRS will agree to, and it is definitely in your best interests to be aware of them. Understanding your situation and what you can do to convince the IRS that you’re working with them is the first step to removing their influence from your life.





The IRS Is Not In The Business Of Being Generous

The IRS doesn’t offer IRS forgiveness out of kindness or generosity. The IRS will forgive tax debts because the reached resolution is in their best interest. The key is to align yourself with the government’s best interests, but only when the outcome also works in your favor. Much like the necessity of understanding the importance of the word “compromise” in an offer in compromise, you have to be willing to meet the government partway.

As with all IRS tax debt problems and concerns, do not feel like you are alone. There are over a million people going through similar situations and help is available.


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IRS Tax Relief – IRS Forgiveness – Offer in Compromise

If you owe the IRS and can’t pay, you may qualify for the IRS Debt Forgiveness Program. The IRS Forgiveness Program is officially called an Offer in Compromise. The Offer in Compromise program is the ultimate IRS Tax Relief option.

Under certain circumstances, financially struggling taxpayers can have their IRS tax debt partially forgiven. The IRS will never take 0 dollars as a settlement. The IRS will go as low as $100 as a total settlement. When the IRS considers “IRS Forgiveness”, the present financial condition of the taxpayer is of primary importance. That means the IRS cannot collect more than a taxpayer can pay. If any collection action by the IRS would force a tax debtor into a financial crisis, the IRS cannot collect the back taxes.

IRS Tax Relief – IRS Forgiveness – Offer in Compromise

Taxpayers that have the resources to pay only a partial amount of their tax debt can apply to the IRS government payment plan called an Offer in Compromise to resolve the remaining amount. Depending on the financial capacity of the taxpayer, the IRS significantly reduces the total debt to an amount that the taxpayer can pay. This reduced amount can be paid in a lump sum or in fixed monthly installments.

IRS Tax Relief – Fresh Start Initiative is an “Expansion” of the Offer in Compromise Program

To make it easier for taxpayers to qualify for an IRS Forgiveness in the Offer in Compromise program, the IRS has expanded their Fresh Start Initiative. Under these more flexible rules, taxpayers do not have to disclose extensive financial details to the IRS to judge their paying ability. The Fresh Start Initiative for IRS Forgiveness offers financially struggling taxpayers the following advantages:

  • The IRS now looks at only one year of future income for offers if they are paid in five or fewer months when calculating a taxpayer’s reasonable collection potential. This is down from previous four years. For agreements of six to 24 months, the IRS now looks at two years of future income instead of the previous five years.
  • Taxpayers are now allowed to make their student loans’ minimum payments for post-high school education loans guaranteed by the federal government.
  • Taxpayers may, under certain conditions, pay delinquent federal and state or local taxes in monthly installments if they cannot pay it in full.
  • The standard allowance for the Allowable Living Expense amount has been expanded. This allowance now includes credit card payments, bank fees and charges, and other miscellaneous allowances.

What Should You Do Next?

Understanding your IRS tax debt and dealing with the IRS isn’t easy to do alone, even with programs like IRS Forgiveness. Luckily, there are IRS Tax Relief professionals at Flat Fee Tax Service, Inc. who can help you navigate your IRS Forgiveness options.

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