You may have every intention of filing and paying your taxes on time each year. However, at some point you may experience an issue that prevents you from being compliant with the IRS.
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The IRS' main obligation centers on collecting current and past due taxes. Because it can be difficult to collect money from people who travel and live overseas, the federal government has implemented laws that could make it more challenging for seriously delinquent taxpayers to get a passport. If you owe taxes and plan to travel internationally, you should realize how your tax debt could impact your ability to get or renew your passport.
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The IRS has the duty to make sure you pay every cent that you owe in taxes. When you have an outstanding tax debt, the IRS will utilize a variety of collection methods to settle the amount.
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Close to a million taxpayers owe the IRS money at any given time. While the IRS makes sincere attempts at collecting each penny owed to the government, in reality it does not have the resources to pursue each individual debtor.
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Despite having millions in the bank, celebrities are just like everyday taxpayers and sometimes experience their fair share of tax woes. These 10 celebrities are well-known for their work on the big screen or in concert as well as the fact that they were charged with tax evasion.
Taxpayers with IRS installment agreements have the opportunity to clear their accounts with the agency over time. However, some taxpayers end up defaulting on their agreements by missing payments or sending them in late. What are the consequences of defaulting on an IRS installment agreement?
Every year, the IRS imposes tax penalties upon individuals and businesses. In most cases, these penalties are related to minor oversights such as failure to submit a tax return on time or a failure to pay a tax bill on time. In some cases, taxpayers may be subject to more than one penalty at a time, which can raise his or her tax liability substantially. One of the penalty relief provisions the IRS offers is called a first-time penalty abatement. While the agency is strict about imposing tax penalties where necessary, some first-time tax offenders may qualify for penalty reduction or removal under this arrangement.
The IRS has instituted a special program called the Offshore Voluntary Disclosure Program (OVDP). Under the terms of this arrangement, taxpayers who have been hiding assets may be able to report these activities to the agency and avoid being criminally prosecuted by the IRS. However, there are several conditions for receiving amnesty under the OVDP and any taxpayer who is considering applying should do so only after investigating the entire program and its requirements.
As a result of the economic crisis of recent years, many American taxpayers have applied for and received cancelation of some debts such as mortgages, car loans, and credit card bills. One thing that some citizens may not know, though, is that their canceled debt may be subject to income tax by the IRS. While the tax bill they get at the end of the year may be considerably less than the debt that was canceled, it may still put a strain on the household budget. The best way to prepare for this is to speak with a tax professional to find out if your canceled debt is taxable well in advance of the income tax deadline.
The income tax deadline is rapidly approaching and if you owe money to the IRS, you don't have much time to come up with your balance due. But what can you do if you won't have the money you need to pay off your tax bill? One solution is to sign up for an IRS installment plan. These plans make it possible to pay off your tax balance over time, rather than all at once.
