If you have a legitimate doubt that you owe part or all of the tax debt, you will need to complete Form 656-L, Offer of Commitment (Concern about Liability), in PDF format. The question of whether to collect it arises when you accept the amount due; however, you cannot pay the full amount due. Do you owe back taxes? Are you seeing a bill for a lump sum of money that you have to pay to the IRS and you think that there is no way to pay it? Here are 12 things you should know to negotiate a favorable tax agreement with the IRS. But first, there are 12 things you should know to negotiate a favorable tax agreement with the IRS.
Failing to file a tax return if you owe taxes can lead to severe penalties, ranging from a fine equivalent to 5 percent of your unpaid tax bill for each month in arrears, to 25 percent to criminal prosecution. You may have heard that there is a statute of limitations for back taxes. The IRS cannot collect taxes due after the tax collection law's due date, usually 10 years from the day the taxes were due. Keep in mind that if you reach an agreement with a Chapter 13 bankruptcy payment plan, you'll have to pay all of your back taxes in installments.
However, actions can suspend or extend the CSED, so it's important to consult a tax professional to find out the exact date your back taxes will be due. With more than 30 years of experience, he oversees the provision of tax services, quality control and compliance with tax legislation. This first step to IRS tax settlement is mostly mental, but it may very well be the most important. If you consult with a reputable tax professional and follow their instructions, you may be able to reduce your total back taxes, set up a payment plan, and get back on your feet as you start paying your back taxes.
If this seems too complex for you to solve on your own, or you just want to make sure you have the best chance of succeeding, you can also call a tax relief company or a lawyer who specializes in taxes.