Published: Nov 11, 2022 4 min read
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It’s easy to get behind on your taxes – and hard to get out of tax debt. According to the IRS, over 11 million Americans owed a combined total of over $114 billion in back taxes to the federal government as of 2020. And this figure doesn’t include amounts owed for state and local taxes.

For some taxpayers, getting out from under their tax debt is as simple as paying the monthly penalties once they have the funds. But people who owe taxes and aren’t able to pay them are in a much more difficult situation. The longer they put off addressing their tax debt, the more they’ll owe in interest and penalties. Paying their full tax debt may be financially impossible. What’s more, at some point the psychological hurdles they must clear to begin addressing their tax situation may be just as daunting as the financial ones.

This is why the IRS has programs and policies designed to help people and some small businesses address their tax debt. But each tax relief option has its own requirements – and it can be tricky trying to figure out who qualifies for which program. If you are struggling with tax debt, Anthem Tax Relief can help you navigate through the complicated process, click here to get started.

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IRS Tax Relief Programs

Some of the programs and policies available from the IRS are collectively referred to as tax relief. These include:

  • Offers in compromise
  • Coronavirus tax relief
  • Tax forgiveness
  • Penalty abatement
  • Installment agreements
  • Currently non-collectible status

Tax programs aren’t always easy to access, but they can be a financial lifesaver for people who are willing to work with them. It’s important to understand, though, that some of these programs don’t actually reduce the amount you owe but may make paying your tax debt more manageable.

Who qualifies for tax relief?

Tax relief programs don’t require tax debtors to pay more than they can afford. Instead, they create a path to freedom from tax debt that takes into account people’s financial and personal circumstances.

To take advantage of these plans, the IRS will usually require taxpayers to file all of their past-due tax returns, be up-to-date on the current year’s taxes, and meet certain income requirements. The IRS considers people’s current financial status, their ability to pay, and the circumstances surrounding their delinquency. It then works out a payment plan that may involve the waiver or reduction of penalties and interest charges and/or the forgiveness of certain tax debts.

Getting Started: Resolving Tax Debt

Merely qualifying for tax relief is not enough to reduce a person’s tax debt. As with most government programs, there’s a great deal of documentation required and very specific procedures that must be followed. For example, tax relief applicants may be required to submit wage and income records, documentation of living expenses, medical, police, and fire reports, student loan records, death certificates of family members, and information about the impact of natural disasters.

While it’s possible for people to handle tax relief applications and the follow-up negotiations with the IRS themselves, tax relief professionals may help customers work through the complexities of these programs to make sure they receive the best possible assistance. They can help make the paperwork burdens manageable and take much of the stress out of dealing with the IRS. Tax relief professionals have a thorough understanding of the various ways that your tax debt may be reduced, as well as experience in how the IRS tends to approach tax relief applications.

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