How To Handle a Tax Bill You Can’t Pay

How To Handle a Tax Bill You Can’t Pay
What could be more chilling than receiving a notice from the IRS that you owe a huge tax bill? The answer: the realization that you don’t have the money to pay off said tax bill. So what should you do if you find yourself in this situation? There is hope.
First off, never ignore such a situation and just hope that it will go away. That won’t work. Instead, face it head on. A good place to start is to contact a tax professional. The IRS does offer several options for people in this situation, but you might not know which is the best option for you. Therefore, meeting with a tax pro is usually a good idea.
The IRS actually offers several payment options for taxpayers in the hole, if they qualify. You can go ahead and pay it off directly from your bank account via IRS Direct Pay. You can also petition the IRS for an installment agreement wherein you agree to pay off the debt monthly. You can request an offer in compromise, as well, which if accepted could lower the amount you have to pay back.
However, as mentioned you must qualify for this option and part of that includes having debt and penalties of $50,000 or less, combined. No matter which payment method you choose you should do everything you can to pay off your debt in full as quickly as possible. The longer you delay payment the stiffer the penalties and the interest will get
Want to learn more? Contact us
Follow GROCO on Facebook
Tax Time Tips for Mortgage Holders
Tax Time Tips for Mortgage Holders Tax Time Tips for Mortgage Holders, it’s that time of year again when numbers such as 1040, W-2 and INT-1099 become all too familiar to millions of people. One of the benefits of holding a mortgage on your house is the ability to claim certain deductions that can assist…
CA Credit for New Home Purchase – Fund Running Out
CA Credit for New Home Purchase – Fund Running Out By Ron Cohen, CPA, MST Partner Greenstein, Rogoff, Olsen & Co., LLP California allows a nonrefundable credit against net tax equal to the lesser of 5% (.05) of the purchase price of the qualified principal residence or ten thousand dollars ($10,000). But only a limited amount…
More Work for Accountants! President Obama’s Corporate Tax Proposal
More Work for Accountants! President Obama’s Corporate Tax Proposal By Ron Cohen, CPA, MST Partner Greenstein, Rogoff, Olsen & Co., LLP In the White House summary of corporate tax proposals: http://media.npr.org/documents/2009/may/whitehouse_taxhavens.pdf At “Backgrounder” Article I. Sec. 1, it states: “Current Law Companies Can Defer Paying Taxes on Overseas Profits Until Later, While Taking Tax Deductions…
Deducting “Other” Business Expenses
Deducting “Other” Business Expenses The mysterious “other.” Some tax deductions are not mentioned by name on a tax form but can still be quite valuable to a taxpayer. If you own a trade or business, you can deduct a number of expenses under the broad category of “other.” In general, taxpayers may deduct ordinary and…