How to Settle IRS Debt: A Step-by-Step Guide
You can settle IRS debt by negotiating payment terms, applying for an Offer in Compromise, requesting Currently Not Collectible status, or setting up a payment plan—each with specific requirements and pros/cons.
Owing the IRS is stressful, but you have more options than you might think. Whether you owe a few thousand dollars or six figures, the IRS offers programs to help taxpayers resolve their debt in ways that fit their financial situation.
Ten Things to Do Now If You Owe Back Taxes
If you’ve received a notice from the IRS or realized you owe back taxes, you're not alone—and you’re not out of options. Every year, millions of Americans find themselves behind on their taxes for a variety of reasons, from financial hardship to simple oversight.
Whether the IRS has contacted you or you’ve discovered the debt on your own, the most important thing is to act quickly. The longer you wait, the more interest, penalties, and stress you accumulate. This guide will walk you through 10 critical steps to take now if you owe back taxes, and how to minimize damage to your finances and peace of mind.
Advantages and Disadvantages of IRS Installment Plans
[Editor's Note: This article was originally published in November 2012 and has been updated for accuracy and comprehensiveness.]
Many taxpayers who owe large amounts of back taxes to the IRS set up IRS installment plans in an attempt to clear up their accounts. These installment plans can be a convenient way to pay off back taxes without putting an unnecessary strain on an individual's budget. While an IRS payment plan may seem like a good idea in theory, there are a few situations where signing up for this type of plan may not be the best solution. Here are some of the advantages and disadvantages of IRS installment plans.
Wage Garnishment FAQ: Your Top Questions Answered
If you've recently been hit with a wage garnishment—or you're worried one might be coming—you're not alone. Wage garnishment can feel overwhelming, but understanding your rights and options is the first step toward regaining control. Below, we answer some more of the most common questions people ask when facing wage garnishment. (Also see part 1 of our wage garnishment FAQs.)
Tax Credits vs. Tax Deductions: What's the Difference?
{Editor’s Note: This post was originally published in September 2013 and has been updated for accuracy and comprehensiveness.}
When tax season rolls around, many people look for ways to reduce their bill—and rightly so. But understanding how different tax breaks work can make a big difference in how much you actually save. Two common tools in your tax-saving toolbox are tax credits and tax deductions. While they might sound similar, they work in very different ways. Let’s break it down.
IRS Tax Documents: What to Keep and How Long
{Editor’s Note: This post was originally published in August 2013 and has been updated for accuracy and comprehensiveness.}
Some taxpayers might feel that they don't need to keep their income tax documents unless they have particularly complex tax situations. The reality is that all taxpayers should keep their essential tax documents on file. Depending on your circumstances, you may need to keep your records for several years, in case of an audit or to back up a claim.
I Didn't File My Taxes in Time - Now What?!
{Editor’s Note: This post was originally published in April 2015 and has been updated for accuracy and comprehensiveness.}
The IRS requires that you file your taxes by midnight on April 15. Even with this deadline set in stone, you may still be unable to get your taxes filed in time. If that is the case, you are not alone. According to a study by IPX, roughly 31% of Americans procrastinate filing their taxes. So if April 15 has passed and you haven't filed, here are a few things you can do to minimize the consequences of late filing.
Resolving Tax Liens and Levies
Your Guide to Deducting Pregnancy Medical Expenses
Editor’s Note: This post was originally published in January 2014 and has been updated for accuracy and comprehensiveness.
Having a baby is an exciting life event, but it also comes with significant expenses—many of which start during pregnancy. The good news is that certain pregnancy-related medical costs may be tax-deductible, helping you ease the financial burden. However, not all expenses qualify. Understanding which maternity costs you can and can’t deduct will help you keep better records and maximize your potential tax savings.
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