Owing taxes to the IRS can be stressful...especially when the balance is substantial and interest and penalties are adding up. Fortunately, the IRS offers options that make it easier for qualified taxpayers to manage or resolve tax debt without digging deeper into financial hardship.
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What is audit representation and do I need it?
Audit representation is professional assistance provided by a tax expert to guide you through an IRS audit. Hiring an experienced representative can save time, reduce stress, and help you navigate complex tax laws to protect your finances.
[Editor's Note: This article was originally published in September 2013 and has been updated for accuracy and comprehensiveness.]
What is the difference between a tax lien withdrawal and a tax lien release?
A tax lien withdrawal removes the IRS Notice of Federal Tax Lien from public record as if it never existed. A tax lien release shows the debt was paid, but the lien remains in public record as “released.” Withdrawals offer a cleaner outcome and are available after payment in full or sometimes through a direct debit installment agreement.
[Editor's note: This article was originally published in July 2018 but has been updated for accuracy and comprehensiveness.]
If you owe the IRS $51,000 or more, unpaid taxes could put your ability to apply for or use a U.S. passport at risk. Thanks to the FAST Act (Fixing America’s Surface Transportation Act), the State Department can deny or revoke passports for taxpayers with seriously delinquent tax debt. Understanding how the FAST Act works—and how to resolve your tax debt—can help protect your passport and your ability to travel internationally.
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What happens if you fail to file your tax return?
The IRS charges a failure-to-file penalty of 5% of unpaid taxes per month, up to 25% of your balance. If your return is over 60 days late, you may owe a minimum penalty of $485 or 100% of your unpaid tax. Filing as soon as possible reduces penalties, even if you can’t pay in full.
If you would like more information about failure-to-file penalties, read on.
Married couples can choose to file jointly or separately. Filing jointly usually provides bigger tax benefits, but filing separately may be better if one spouse has debts, high medical expenses, or liability concerns.
When tax season rolls around, one of the most important decisions married taxpayers face is how to file:
married filing jointly or
married filing separately. While the IRS allows either option, the choice can have a big impact on your tax bill, refund, and eligibility for credits and deductions.
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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.
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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.
[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 your budget. And while an IRS payment plan may seem like a good idea in theory, there are some 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.
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.)
