If you owe back taxes and receive a paycheck, the IRS can use their power to collect up to 70% of your gross income through wage garnishments. They might also use more severe collection methods like bank levies and property seizures to try and settle your tax debt. Is the IRS threatening you with certified letters demanding payment, or worse, threatening to garnish your wages? If so, the IRS Fresh Start program might be your solution, whether you’re an individual taxpayer or a small business owner.
The IRS initially introduced the Fresh Start Program in 2008 to help struggling taxpayers, then later expanded it to provide even more flexible tax resolution options. One of the most impactful changes to the Fresh Start Program was updates to the Offer in Compromise program, which drastically reduces the tax burden for the most distressed tax debtors. This expansion can enable some taxpayers to resolve their debt in only two years, compared with up to five years previously. The expansion of the Fresh Start Program in 2012 also improved the Allowable Living Expense allowance category and amounts.
An Offer in Compromise is an agreement with the IRS to settle the tax liability for less than the full amount. Because an OIC provides the most significant tax debt reduction, the IRS doesn’t accept just any application. Alleviate Tax handles the hard details of qualifying for an offer in compromise, helping alleviate your tax debt and saving you tens of thousands in IRS penalties, interest, and fees. We’ve been able to save 98% of the original tax debt for some clients with an Offer in Compromise.
If the IRS calculates that the total tax debt can be paid (whether in a lump sum or a payment agreement), they will require those payment methods instead. The IRS calculates the taxpayer’s reasonable collection potential using their income and assets.
The Fresh Start Program updates included some nuanced changes for calculating a taxpayer’s ability to repay their tax debt, such as narrowed guidelines for when a dissipated asset is included in calculating collection potential. Also, repayment potential calculations will no longer include particular equity in income-producing assets, such as on-going businesses.
Alleviate Tax can help get you back in compliance with the IRS, whether with an approved installment plan or an OIC, so you can get back to living your life instead of being stressed out. We provide tax relief services that can substantially reduce your tax liability, possibly saving you tens of thousands in penalties, interest, and fees added on by the IRS.
We cut through the complicated IRS rules and calculations to determine the strategy that will deliver the most savings. We handle the entire process while keeping you updated at every step until you get the tax relief you’re entitled to.
Contact us using the form below to get in touch with one of our tax specialists and discover if the Fresh Start Program can provide you the tax relief you need.
In less than 15 minutes, you can learn what ways your tax burden might be lifted from your shoulders so you can get on with your life.
