It’s a terrible position to be in if you owe the IRS money and then must pay a lot of interest and penalties on top of that. It’s a bad idea to stop making payments because you’re afraid of incurring interest and penalties.
Instead of going through all of this hassle, you should take advantage of the IRS’s Fresh Start Program. Is your curiosity piqued to learn more? Continue reading over here!
Just what is this programme that promises a new beginning?
To dispel any notion that you might have formed, the Fresh Start Initiative was not just recently instituted. It began in 2011 with regulations aimed at taxpayers who owed taxes but were not subject to federal tax liens.
This programme was designed specifically to help first-time tax evaders make amends for their mistakes. The programme allows taxpayers to spread out their tax payments over six years, with monthly payments based on their current income and the value of their liquid assets. Over the course of six years, they typically clear up any outstanding debts and obligations.
FIL funds will be withdrawn more frequently from taxpayer accounts that have established direct debit installment agreements.
FTL restrictions are easily lifted upon debt repayment.
Installment payment plans that are easy for small businesses to secure
The Office-In-Compromise (OIC) programme will be made easier to use for taxpayers by standardising the application process and expanding eligibility criteria.
More improvements were made to the Fresh Start Initiative in 2012 so that more taxpayers could benefit from it. As a result of these adjustments,
Increasing the range and total amount of expenses that the IRS considered reasonable when calculating a taxpayer’s ability to make a monthly payment, such as student loans, various tax debts, and reasonable living expenses.
Streamlining the IRS’s method for estimating a taxpayer’s future income while still accounting for OICs
As a result of these adjustments, the Internal Revenue Service learned more about the factors that contributed to taxpayers’ inability to pay their taxes. Therefore, despite the programme’s own formulas, the Internal Revenue Service considered the realities that people faced, such as unemployment, which caused them to rely on their taxes.