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Are you struggling with back taxes? If so, you might be eligible for tax debt relief.

Tax debt relief is a process that can help get your back taxes paid off over time through monthly payments versus an upfront, lump-sum payment. Read on, and we’ll provide a quick explanation of how tax debt relief works—and help you decide if it’s right for your situation. We’ll also cover how to apply for tax debt relief, offer some tips on how to maximize the benefits of this program, and answer common questions asked by taxpayers.

Okay, so what exactly is tax debt relief?

It’s a simple enough idea, and yet many people haven’t heard of it! To make matters even more confusing, there are a number of common myths about debt relief. Tax debt relief is a payment or repayment plan that helps taxpayers pay off their back taxes over time. The benefits of this are that taxpayers can pay off their tax debt with a monthly payment, so there’s no need to come up with the total amount of back taxes owed in a lump sum.

Am I eligible for tax debt relief?

Eligibility for tax debt relief is typically based on your “ability to pay,” i.e., your income and expenses. Whether you choose a short-term or long-term IRS repayment plan, you will be subject to interest and penalties until your balance is zero. If paying via credit card or debit card, you’ll also likely pay processing fees. An “Offer in Compromise” is another form of repayment plan where the IRS agrees to waive part or all of your back tax amount. This type of plan can be challenging to qualify for as the IRS accepts less than half of these requests.

Is debt relief a good idea for seniors?

Many people can benefit from debt relief. By knowing their options and talking to the right people, seniors could seriously reduce their tax debt.

How do I apply for tax debt relief?

The easiest way to apply is to fill out an application, known as IRS form 9465. This form requests information that will help the IRS determine whether you’re eligible for tax relief.

Should I hire a tax relief company?

This can be a great option if you’re not sure where to start or you don’t want to navigate the process alone. There are a number of companies that can help you fill out your tax forms or find other ways to get debt relief.

Can I do it myself?

If you can fill out your own taxes and you have sufficient knowledge of the law, you may not need an outside company. However, a professional debt relief company can provide you with experience and leverage to help you move closer to financial freedom.

Any other helpful tips for taxpayers?

The best way to avoid tax issues with the IRS is to make sure your taxes are filed correctly. This includes filing on time, paying what is owed, and not ignoring any IRS notices that ask  you to contact them. It’s also a good idea to keep copies of all tax forms you’ve filed with the IRS for at least four years, just in case issues arise later (such as audits or taxes owed).

 Can CreditAssociates help?

CreditAssociates can’t help you with tax debt relief through the IRS. However, we can help you reduce your overall debt through a debt-settlement program. A debt-settlement program results in an agreement between you and your creditors, providing for a payoff at a lower amount than owed. We’re experts at negotiating with creditors and helping clients resolve their debts. Depending on your situation, we could help you save up to half or more on your outstanding debt and have you debt-free in as little as 24-36 months. Get your free consultation today.

More Common Tax Debt Relief Questions

Is tax debt relief legit, or is it a scam?

Tax debt relief is legitimate, however, it’s essential to do your research before hiring a third-party company.

What red flags should I look for from tax debt-relief companies?

When evaluating tax debt-relief companies, you should be sure to assess their fees, their proposed tax resolutions, and any guarantees on the offer. An excellent way to find a reputable tax debt-relief company is to research reviews and ratings on platforms such a Trustpilot, Google or the Better Business Bureau.

How do I get rid of back taxes?

The best way to get rid of your back taxes is to file what’s known as an Offer in Compromise. This could allow you to settle for a lower amount than what the IRS or your state tax agency says you owe.

What happens if I owe taxes and can’t pay?

If you owe taxes and can’t afford to pay, there are a couple of options you might want to explore, including payment options and filing for a financial hardship. If you’re experiencing financial hardship, you might also find it beneficial to explore debt settlement options. Debt settlement could help reduce outstanding balances and monthly payments on other forms of debt, such as credit cards or medical bills.

What if I don’t pay taxes for several years?

If you don’t file taxes for several years, the IRS will send you a tax bill. If you don’t pay the bill, the IRS can then take legal action. This can cause you significant financial harm, as well as result in a huge tax burden.

Tell me about the IRS’s Fresh Start program.

Fresh Start is a program designed to help people struggling with their tax debt. With the Fresh Start program, you could get a tax reduction of up to $50,000 on your next tax bill, plus an extended payment plan that can last as long as 72 months.

How do I prove tax hardship with the IRS?

To apply for hardship status with the IRS, you can fill out form 433-F. This is a request for tax debt relief, and it may be granted if you meet specific IRS criteria, like if you’re facing unexpected expenses or paying medical bills due to an illness.

What’s a hardship refund?

The IRS may grant you a refund due to financial hardship. The IRS may also decide to offer this type of tax debt relief if they deem that your loss was caused by factors outside your control, such as a death in the family or medical expenses due to illness or injury. If you’re facing financial hardship, you might find additional debt relief through debt settlement. These companies can help resolve personal debts, like credit card and medical bills, for less than you owe.

Is there one-time tax forgiveness?

If you’re facing financial hardship, the IRS may potentially forgive your tax debt. However, this isn’t always the case, and it depends on factors such as your income, filing status, and exemptions.

What if I’ve had this tax debt for a long time? Will the IRS still forgive it?

After 10 years, your tax debt will no longer be forgiven by the IRS. The IRS has a time limit, and if you don’t request tax forgiveness within that window of opportunity, then your taxes become ineligible for relief.