The IRS determines hardship by comparing your monthly income against your allowable living expenses such as housing, utilities, clothing, transportation, healthcare, etc… If your income barely covers or falls short of your basic monthly expenses, you may qualify for a hardship status.
Being compliant means that you are up to date on all of your tax filings up to the current year. The IRS will not put you on a program to help you with your situation until you are up to date on your taxes. Whether you know you owe or not, you must have all your taxes filed to get into any program with the IRS Fresh Start Program.
You sure can. You can go to irs.gov and all the information is there for you to help yourself. There is a plethora of information and this is the resource for Tax Professionals such as Enrolled Agents, CPAs, and Attorneys. It can be overwhelming though and that’s why people hire a firm that specializes in tax resolutions to help them with their IRS tax debt.
If you got a refund last year, you do not need to worry. You withhold enough. For those that owed last year, a simple way to get a good approximate figure is to divide what you owed the previous tax year by 12 months and that’s how much more you should withhold. For example, if you owed $3,000 last year, divide $3,000 by 12 months. That will get you $250 a month. So you have to withhold more than what you currently withhold. So you have to go to your human resources/employer and tell them to withhold additional funds.
There are 3 steps in the tax resolution process. The 1st step is to have a consultation with us so we can ask you questions about your tax history. The 2nd step, if applicable, is to get you Compliant on your taxes. This means you have to be up to date on all of your tax filings. Once you are compliant with your taxes and we know exactly how much you owe the IRS, we can move to the next step. Resolution. The 3rd Step is where we get you into the best resolution possible based on your current financial situation.
We first need to know how much your total IRS balance is. This may involve preparing back taxes and have you up to date on your tax filings. Once you are compliant and are up to date on your taxes, we will know what your total tax debt is. Then we will go over your monthly income and expenses and based on the IRS standards, we will see if you are in a financial hardship or not. This also includes knowing all of your assets too as the IRS does take all assets into consideration. At this point, we will know what programs you qualify for.
We can help you to reduce your IRS tax debt if you are in a financial hardship. There are 2 main programs on the IRS Fresh Start Program.to help you reduce and eliminate your debt. They are a Partial Payment Installment Agreement and the Offer in Compromise. There is another hardship program called Currently Non Collectible but this program INCREASES your tax debt because you are just temporarily delaying the collection process. We can determine what you qualify for after we consult with you.
Yes, we do all states that have state income tax. We also do business tax debt too. Similar to the IRS, the states will want you to be compliant on your tax returns. We can help you with that as we are also a full CPA firm.
Once you are up to date and compliant on your taxes, we can immediately work on your tax resolution. It will take no more than a week or 2 to get you into an Installment Agreement, Currently Non Collectible, or a Partial Payment Agreement. Offer in Compromise can take up to 6 - 12 months. Not only is the wait process long but there is a long queue for the IRS Offer in Compromise system.
