Unpaid tax can be quite a thorn on anyone’s side, but it can be hard if you’re in too deep with your pending payments already. Whatever your situation might be, it’s important to know that there’s a way out. Taking a cautious and hopeful approach is the best way to find a solution.
Being more careful in how you handle the situation can lead to much better results and peace of mind as you gain an IRS-approved solution to your financial woes. Getting a tax professional who can help you up and in the right direction is also ideal.
There are multiple ways to deal with tax debt, and debt forgiveness is one of them. Essentially, debt forgiveness is a form of debt relief that helps alleviate some of the pressure on the taxpayer.
Here are three resolution options that are worth looking into:
1) Innocent Spouse
One of the absolute ways that debts can be canceled is through the concept of an “Innocent Spouse.” This is a form of relief that can help someone who was married at the time of the tax debt but is not the one who incurred it. Consult a tax professional to see if your marital circumstances make this a viable solution to your situation.
When the individual is married, it’s possible that the spouse could have made a number of tax-related decisions that might have affected the end result in terms of how much was owed. If the innocent spouse can prove their lack of involvement, it might be possible to cancel any tax debt accrued from their marriage.
2) Offer in Compromise (OIC)
It is possible to try and settle your debt for less than what you actually owe. Offers In Compromise are a formal negotiation that can help taxpayers settle their debt for less than what they owe. This is a negotiation between a taxpayer and the IRS, though the IRS is not obligated to accept this form of resolution.
To be eligible for this resolution, the taxpayer must fall under certain categories that explain their current financial situation. This usually requires documentation of financial hardship. It may not be possible for this resolution to be used for all tax debt, and very few qualify for an OIC, so seek the help of a tax professional to increase your chances.
3) Currently Not Collectible (CNC)
In order to better serve taxpayers who are struggling and unable to pay their taxes, the IRS can place them in a status of Currently Not Collectible. This is a negative mark on a taxpayer’s credit, so it should only be used as a last resort.
This status is determined by several factors, most of which focus on the taxpayer’s current financial situation. For instance, when a person is unemployed for an extended period, it’s possible to request being put on a CNC status. Keep in mind that being CNC is only a temporary solution, though.
Don’t be afraid to ask for help from a tax professional who can help you navigate the world of tax. You can put your mind at ease knowing that you have a tax debt forgiveness solution waiting for you ahead.
In need of tax debt forgiveness? Axiom Tax Resolution Group is a tax resolution services specialist in Birmingham, AL, ready to find a permanent solution to your tax problems with the IRS. Get in touch with us today!