Things to Know for Negotiating a Favorable IRS Tax Settlement

Negotiating with the IRS can be a complex process, but it is possible to achieve a favorable outcome with the right approach.

Here are some things to keep in mind when negotiating a settlement with the IRS:

Understand your tax liability

Before negotiating a settlement, it is important to have a clear understanding of your tax liability. This includes any penalties and interest that have accrued on your tax debt. You can request a transcript of your tax account from the IRS to get a clear picture of what you owe.

Consider your options

The IRS offers several options for taxpayers who are unable to pay their tax debt in full. These include installment arrangements, currently not collectible status and offers in compromise. Each alternative has its own requirements and benefits, so it is important to explore all of your options before deciding which one to pursue.

Seek professional help

Negotiating a settlement with the IRS can be a daunting task, so it is a good idea to seek professional help. Tax attorneys, enrolled agents, and certified public accountants (CPAs) can all provide guidance and representation during the negotiation process.

Be honest and upfront

When negotiating with the IRS, it is important to be honest and upfront about your financial situation. If you try to hide assets or income, it could result in penalties or criminal charges. Providing the IRS with accurate and complete information can help build trust and improve your chances of reaching a favorable settlement.

Stay organized

Keep copies of all correspondence and documentation related to your tax settlement negotiations. This can include letters from the IRS, financial statements, and tax returns. Staying organized can help you keep track of where you stand in the negotiation process and provide valuable evidence if disputes arise.

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