If you need tax help you’re certainly not alone. Every year millions of taxpayers get audited, fall into overwhelming tax debt, or miss out on unclaimed tax refunds. Either way, they need help. Here at SuperMoney we provide actionable advice on tax-related issues and put you in touch with tax professionals that can help you further.
No, you’re not looking for an accountant to crunch the numbers for you. You’ve gotten into a tight situation due to back taxes, unfiled tax returns, audit penalties, payroll tax issues, or other tax difficulties.
Consider Contacting a Tax Professional
A tax professional may be a tax attorney, certified public accountant, or enrolled agent depending on the situation. Each will act as an advocate on your behalf and assist in obtaining the best possible resolution for your tax problem.
- Tax attorney. The benefit of a tax attorney is that he or she can offer you confidentiality (attorney/client privilege), negotiation skills, and legal expertise. They can provide assistance with business or individual taxes, payroll taxes, business operations, and estate planning.
- Certified public accountant (CPA). CPAs, not currently under suspension or disbarment from practice before the IRS and who are duly qualified to practice as a CPA, may practice before the IRS.
- Enrolled agent. Enrolled agents, like attorneys and CPAs, have unlimited practice rights. They are unrestricted as to which taxpayers they can represent, what types of tax matters they can handle, and which IRS offices they can represent clients before.
Additionally, other individuals such as enrolled retirement plan agents, enrolled actuaries, registered tax return preparers, even you or a family member, may practice before the IRS, but only in limited circumstances.
Finally, the IRS offers tax help via the Taxpayer Advocate Service (previously called Problems Resolution Officer). The TA acts as a liaison between the IRS and you by stepping in to help taxpayers resolve cases that otherwise might lead to hardship. They help with disputes over tax refunds, improper audits, repayment issues, penalty assessments, and more.
Tax Debt Options and Help
Finding yourself in tax debt can be frightening, especially if you are unable to pay your IRS tax debt in full. However, there are options for resolving your issue.
- Offer in compromise (OIC). With an offer in compromise, the IRS agrees to accept less than what you owe. An OIC is for those who have no hope of ever paying their back taxes in full.
- Installment payments. If you owe less than $25,000 in back taxes, the IRS may be willing to arrange for you to repay your debt in monthly installments.
- Partial installment payments. If you don’t qualify for full installment payments, the IRS may arrange to have you pay lower installments over a longer period.
- Currently not collectible. This temporary status occurs when someone cannot pay due to a temporary hardship and doesn’t qualify for an OIC. This is a good option if your income is lower than your allowable expenses and isn’t likely to improve or the statute of limitations on your debt will soon expire.
- Bankruptcy. Some, not all, IRS tax debts may be discharged in bankruptcy. Generally, the tax debt must be due for three years, the tax filing has to be filed for two years, and the tax assessment has to be in place for at least 240 days.
Can the Statute of Limitations Save You?
The IRS has a 10-year statute of limitations to collect a tax liability. After 10 years, however, various factors can extend this time.
- Tax filing. The 10-year clock doesn’t start until you actually file your return.
- Offer in Compromise. The statute of limitations stops when you file an OIC and it doesn’t run while your OIC is under review.
- IRS appeal or lawsuit. The clock stops during most appeals and lawsuits.
- Bankruptcy. The statute of limitations stops during bankruptcy, plus six months after your bankruptcy case is discharged or dismissed.
- Traveling abroad. If you leave the country for more than 6 months, the statute of limitations stops.
- Military deferment. The clock stops during military service and for an additional 270 days after.
To ask about the expiration date on your tax debt, contact the IRS. And if you are in a bind due to tax problems, don’t wait. Get the tax help you need.