If you are facing a mounting tax debt that is taking over your life, tax attorney Travis Watkins wants you to know that you are not alone.
As scary as this time may seem for you, especially if you are facing wage garnishment for unpaid taxes or a levy because of IRS debt, there are still options that may be available to you and your family.
Let's take a look at some of the alternatives that could potentially save your paycheck, your house, and your financial well-being.
Offers in Compromise
An Offer in Compromise, or OIC, is the most popular way to pay the government less than what you owe on your taxes. This compromise is an agreement between the taxpayer and the Internal Revenue Service, and is usually only accepted if the IRS determines that there would be virtually no way for the taxpayer to ever remedy the full debt. There are three types of OIC, including Doubt as to Collectability, Doubt as to Liability, and Effective Tax Administration.
Innocent Spouse Relief
In some instances, a person may have been unaware of the errors made by his or her spouse or former spouse during the filing of their joint tax returns. In a situation like this, the person left in the dark may be able to avoid the spouse's tax debt by filing for Innocent Spouse Relief. There are certain criteria that must be met in order to request this relief, including:
- The return must have been filed jointly.
- The at-fault spouse either failed to report income or took an incorrect deduction, credit, or basis, which caused an understatement of the taxes owed.
- There was no transfer of property or assets from one spouse to another as part of a fraudulent scheme.
- As the innocent spouse, you did not know or had no reason to know that there was an error that caused an understatement of tax when you signed the return.
- It would be unfair to hold you responsible for the taxes owed (for example, the at-fault spouse deserted you).
Currently Not Collectible (Hardship Status)
If you cannot pay the tax debt right now, you may be eligible for a postponement of payments under the hardship status, if you can prove that your monthly expenses prevent you from being able to pay what is owed. The IRS will investigate your financial situation, and will expect to receive documents that reflect costs like your mortgage or rent payments, as well as pay stubs. The IRS also will ask about expenses like food, clothing, transportation, and utilities.
A levy occurs when the government seizes property in order to satisfy a tax debt. Garnishment is when the government withholds your pay to satisfy your tax debt. If you are facing either of these situations, it is worth speaking with anIRS tax debt lawyer to see if you'd be eligible for a Levy/Garnishment Release, which would prevent these assets from being taken from you.
There are many different types of bankruptcies, only some of which will alleviate tax debt altogether. An attorney can help you weigh the pros and cons of having a bankruptcy stay on your credit history for a number of years versus seeking alternative solutions for handling your tax debt.
Sometimes it's not the amount of unpaid taxes that causes the inability to pay, but rather the penalties and interest that get tacked on after non-payment. A Penalty Abatement can help wipe out some of these extra costs and lower the amount of money due to the IRS.
Tax Lien Release
If you have been notified by the government that you have unpaid taxes and you fail to satisfy the debt within ten days, there is a chance that the IRS can attach a lien to all of your property, which would prevent you from selling it. Tax liens can harm your credit and prevent you from borrowing loans. There are important steps that you must take to obtain a Tax Lien Release, and choosing the right IRS tax lawyer to help you is one of them.
Taking the Next Step
If you are facing a large tax debt that is harming the well-being of your family or business, do not wait any longer to seek help. Contact premier tax debt lawyer Travis Watkins at 800.721.7054 today for a free consultation and options for remedying your situation.
Don't let your tax debt grow - call Travis Watkins today.