5 Ways To Get Rid of IRS Debt - Tax Relief Options Explained by Tax Attorney

There's more than one way to get out of your IRS debt. Here we go through 5 options that happen in a lot of cases.

#1 Offer In Compromise
The standard "pennies on the dollar" settlement you see on advertisements. You are settling your tax debt for less than you owe based on your financial information.

If you are barely making it financially each month and do not have many assets, your odds are good! Some people that make more money might also get a settlement, but their debt typically must be large. There are other types of Offer In Compromise not based on financial information, but they are not common cases and very difficult to get approved.

#2 Penalty Abatement
This is removing the penalty portion of your tax debt can get rid of a lot of it. You want to do this once you have paid off the base tax amount or are close to it. “Search TRP penalty abatement guide” on google and you'll find info on the easiest way to do it.

The first-time penalty abatement explained in our guide is really easy to get. It's harder to get for other years and you will need to prove a reasonable cause or an IRS error.

#3 Filing Over Substitute For Returns
Sometimes the IRS has come up with debts for you based on tax returns you did not actually file. Sometimes filing your own tax returns over those will result in a zero balance or at least substantially reduce it.

In a lot of cases like this, once you file the tax returns you owe nothing. A lot of firms still try to sign you up for a "tax relief" case, when all you really need to do is file tax returns. If you haven't gotten any collection letters from the IRS but have not filed in a while, you might just need to file. You also might not need to file as many tax returns as you think.

If you are unsure whether or not you just need filing or a tax relief case, call us at the number below and we'll help.

#4 Currently Not Collectible Status
If you do not qualify for an Offer In Compromise because you have too many assets, or if your debt is close to expiring, filing for currently not collectible status can be a way to get out of paying your IRS debt.

It's basically an IRS payment plan for $0. A lot of clients end up getting their debt expiring while it's in Currently Not Collectible, meaning they pay nothing. Most people getting this option do not make a lot of money. Check out our guide for more info:

https://trp.tax/tax-guide/currently-not-collectible/

#5 Audit Reconsideration
If you were previously audited but did not agree to it, you might be able to get an audit reconsideration through and lower your debt. Maybe you did not have the paperwork at the time or some new information came up. The IRS doesn't really want you to owe if you should not and if your claim looks good, good chance they will knock off the appropriate amount of debt.

Need help from our expert tax attorneys?

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https://trp.tax/taxhelp