Unpaid Taxes in Houston
If you are one of the many taxpayers with back tax debt, we understand your fear. And, you are not alone. The IRS knows there are millions of dollars in unpaid back taxes, interest and penalties–and they are looking to collect that debt.
Many taxpayers fall behind in paying their taxes for any of a variety of reasons – major health issues, divorce, job loss or loss of income. Small business owners may get behind in payroll taxes, which can quickly escalate into a large tax debt, including the interest and penalties the IRS assesses. The amount of tax owed can quickly add up to an amount you fear you will never be able to pay, so you quit filing your returns and hope the IRS does not notice.
Maybe you’re worried that coming forward will get you into more trouble. Maybe you think if you come forward, you will find out the amount you owe will end up being even larger than you imagined. Or you think if you keep quiet, the IRS might overlook you. Wrong. You need to hire a tax attorney. As Houston tax attorneys, we deal with this every day. We can help.
Settling Your Unpaid Tax Debt
There are several means available to settle the amount of back tax debt you owe the IRS.
Work with a Houston tax attorney you can trust: We have decades of knowledge necessary to get you a resolution to your tax issues you can live with.
Offer in Compromise: The IRS realizes that life happens. Sometimes you end up with an enormous tax debt you cannot afford to pay. The IRS has an Offer in Compromise program, which is a win-win for both the IRS and the taxpayer. With this program, the IRS collects on the tax debt and gets the taxpayer back into compliance–filing their tax returns and paying their taxes. The taxpayer settles for a reduced amount, often a portion of the amount they owed the IRS. The process is complicated and the taxpayer must meet the IRS’ requirements and be able to show an inability to pay their full tax liability.
Currently Not Collectible: For those taxpayers on a fixed, limited income or who are currently experiencing financial hardship, you may qualify to be placed in Currently Not Collectible status. If the IRS determines you are Currently Not Collectible, you will be placed in a no-collection status and the IRS will not try to collect from you. This status lasts for a period of time, at which the IRS will reevaluate your ability to pay your tax debt. The amount of time varies, but can last until the statute of limitations expires and the IRS can no longer collect on the tax debt.
Penalty Abatement: If you can show an inability to pay, the IRS may abate some of the penalties they have assessed against you and allow you to pay the tax and interest owed. (Interest generally cannot be abated absent an IRS delay).
Installment Agreement: If you do not qualify for an Offer in Compromise or Currently Not Collectible status, but you still cannot pay your entire tax liability in one payment, the IRS offers the Installment Agreement option. An Installment payment plan is negotiated with the IRS to make repaying your tax debt more manageable. Some taxpayers may qualify for a Partial Payment Installment Agreement where smaller payments are made which total less than the original liability owed.
Pay Your Liability in Full: If you have the ability to fully pay your tax liability, the IRS expects you to pay it. Many taxpayers are surprised to find they may have to take out a home equity loan, borrow from their retirement or savings accounts or sell assets to pay their debt. If you have assets, the IRS will look at these assets to determine your ability to pay your tax debt, even if you do not currently have the cash on hand to pay.
Negotiating with the IRS to settle your back tax debt can be intimidating. The IRS administrative process is astounding in its complexity.
As Houston tax attorneys, we help our clients navigate this complexity. We help negotiate a resolution clients can afford to pay. Our tax attorneys in Houston analyze tax situations and provide clients with the best recommendations to settle back tax debts.
Call (281) 588-0020 for a free strategy consultation.