When a tax debtor is incapable of meeting his or her tax obligations, alternative mechanisms for satisfying a debtor’s tax obligations must be considered. A number of alternatives exist and have been approved time and again by the IRS, including Offers in Compromise and installment agreements. That said, the availability of these alternatives to paying
IRS Issues
IRS Payment Plans for 50K or Less Owed
IRS Payment Plans for 50K or Less When a tax debtor is incapable of meeting his or her tax obligations, alternatives to payment of the full tax liability outright and immediately must be considered. Entering into an installment agreement with the Internal Revenue Service (IRS) is just one of a number of viable options for
IRS Liens Don’t Have to Stop Refinancing
When a tax debtor cannot meet his or her tax obligations, more often than not the result is a Notice of Federal Tax Lien and effectively a lien on the debtor’s assets. If the tax debtor’s principal asset is his or her home, a lien on that home can make it all but impossible to
IRS Notices: CP 501, CP 503, CP 504, and CP 504B
When a taxpayer fails to meet his or her tax obligations, a process is initiated beginning with the taxpayer’s receipt of notices from the Internal Revenue Service. Taxpayers can benefit from learning more about these notices, what they mean for the taxpayer, and what a taxpayer can expect following receipt of these notices. IRS Notices
Criteria for Granting Installment Agreements
Where a taxpayer seeks to enter into an installment agreement because he or she cannot meet federal tax obligations, the taxpayer must satisfy a number of criteria in order to be eligible. The process begins with the filing of the formal request for an installment agreement, which is typically done using Form 433-D. Form 433-D
Cohan Rule
Having become so commonplace in our everyday lives, it almost goes without saying that a taxpayer needs to retain receipts for any expenditures that taxpayer wishes to claim as a deduction. Yet it is equally commonplace that one or two of those receipts will go missing, at which point the question the taxpayer faces is
Partial Payment Installment Agreements
As a default rule, the Internal Revenue Service expects that taxpayers are to meet their tax obligations in full, whether immediately as they become due or if not, then over the life of an installment agreement, or payment plan. However, installment agreements are typically granted only where the tax debtor is financially capable of satisfying
IRS Interest Abatement
When a taxpayer fails to meet their federal tax obligations to the Internal Revenue Service (IRS), interest will accrue on the amount of the tax obligation that remains outstanding. However, there are a number of mitigating circumstances in which a taxpayer can seek to avoid or abate interest on a tax obligation. Interest on tax
Future Income (IRM 5.8.5.18)
The Internal Revenue Service’s (IRS) acknowledges that some taxpayers simply cannot meet their federal tax obligations. In other words, the taxpayer’s net assets and income less living expenses does not permit the taxpayer to pay back the IRS in full. In such situations, the IRS may be receptive to an Offer in Compromise, or an
Calculating IRS Interest
The Internal Revenue Service (IRS) method for calculating interest has changed over time. Currently, the method for calculating interest is described by the IRS as “daily compounding of interest (i.e., interest computed on interest).” Internal Revenue Service, Internal Revenue Manual, Part 20.2.6.1, available at https://www.irs.gov/irm/part20/irm_20-002-006r.html. In other words, each day interest accrues on the principal