How To Resolve an IRS Tax Balance
You may have options to resolve your balance:
1. Payment Plans
IRS generally has 10 years to collect taxes once a return is filed. The time can be extended for numerous reasons such as when you file for bankruptcy or when the IRS is legally prevented from collecting. In cases where a payment plan is an option, it is generally spread out over 72 months unless the IRS has less than 6 years to collect.
2. Offers in Compromise (OIC)
An Offer in Compromise is essentially asking IRS to settle for a lower amount based on financial hardship or based on a legal challenge. For an OIC based on a financial hardship, you will have to provide financial records (bank statements, W2s wage statements, business income tax returns if you own a business as well as proof of your expenses that are being paid such as mortgage statements and utility bills). Then, based on the information given, IRS will determine if you are financially unable to full pay your taxes within the remaining years IRS has to collect from you.
At Milikowsky Tax Law, we are former business owners and key managers and understand where to find crucial information to clearly describe to IRS your financial hardship or circumstances to support your request for a payment plan or OIC. We perform a detailed review of your accounting information and use data analytics to establish financial records that explain why your business may not be able to pay its taxes in full.
We have represented hundreds of businesses in tax law controversies with IRS, EDD and CSLB and have depth of experience and a long history of positive outcomes in working with businesses to resolve tax law issues.