How can I resolve an amount owed to the IRS with most of the amount owed being penalities and interest?
Sunday, November 11th, 2007 at
10:23 pm
Teresa asked:
My husband owed about $1800.00, The irs kept his tax return last year 1625.00, but now say he owes over 3000.00 now. We live in Georgia, do we need an attorney or what to resolve this without having to pay all the fees and interest
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My husband owed about $1800.00, The irs kept his tax return last year 1625.00, but now say he owes over 3000.00 now. We live in Georgia, do we need an attorney or what to resolve this without having to pay all the fees and interest
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they charge what they want when they want.
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You may just want to contact them and try to resolve it yourself. You may also want to get a CPA or Accountant who specialized in this sort of thing to go with you. Sometimes a CPA could help work something out.
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even if you hire an attorney you will still have to pay all the penalities and interest,IRS always gets their money.hiring a attorney will only cost you more and you will still have to pay..The best thing you can do it go to the IRS building and make up a payment plan to pay off the balance….I have dealt with them before and the only way you solve this is to go to them and face this matter…..
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Has he ever had a penalty before? If not, he can simply call and ask for a removal of penalty for first-time abatement. If he has had, he could write the IRS and ask for an abatement of penalties and interest associated with the penalties due to whatever the “reasonable cause” was for not paying, filing, and/or depositing timely. If sustained, the IRS will send an 852C or 854C letter stating why it was sustained and give appeal procedures. Follow the appeal procedures and you have an okay chance of getting it removed or reduced. Call the IRS and dont be afraid to ask questions (1-800-829-1040 for individual tax and 1-800-829-0115 for business tax) about filing dates, extensions that may not be showing up, payment amounts and dates that have been made. Pay the penalties and interest if at all possible because the interest rate is 7% compounded daily! If, you cant pay in full, you can get up to 120 extension to pay for free, no questions asked after that an Installment agreement can be setup in about 10-15 min over the phone as well. Get a loan if possible bc it will be at a better interest rate. You may also do an Offer In Compromise (Form 656) to settle as well. Good Luck!
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With that “small” of an amount, an “Offer In Compromise” would probably be rejected.
If you enter in to an installment agreement, the penalties will stop. This is what he should have done right away.
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contact them and try to resolve it. You cant really escape penalties and interest. but if you dont have the money they might be willing to strike a deal. if the reason he didnt pay in the first place was for a good enough reason they may give you back the penalty portion. but the intrest in inescapable.
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How did he go from owing $1800, then a $1600 refund was taken, then his balance skyrockets back up to $3000? Sounds like some other adjustments were made to his return. At any rate, call the IRS Collections Department and request an explanation for how the balance wnet up so drastically, then request an installment agreement.