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4 Things Anyone with IRS Back Tax Issues Needs to Know
By Brandon Lindsay, CPA |  Updated September 28, 2021 
1. Your Penalties Can Be Removed
Penalties can be such a high percentage of the total amount owed to the IRS, it usually makes sense to consider requesting the IRS to remove the penalties.  

IRS Penalties can be removed if you have reasonable cause.

What is reasonable cause?

Anything may qualify as long as the IRS considers it reasonable.

Penalties can be removed for things such as death, medical reasons, military call-ups, fires, floods, bad accountants, and ignorance of the tax laws.
2. You Don’t Have To Talk To The IRS
Many people hate the idea of having to talk to the IRS.

Fortunately, taxpayers have The Right to Retain Representation.

The taxpayer bill of rights states that “taxpayers have the right to retain an authorized representative of their choice to represent them in their dealings with the IRS”.

The representative can answer questions the IRS may have and provide documentation to the IRS.
3. Make Sure Your Tax Returns Are Filed 
I’ve seen many people who get behind on taxes, stop filing tax returns, and then try to resolve the back tax amounts from the old tax returns.
 
This sounds like a good idea, but the IRS will not let you set up any payment plan or any other arrangements until you’re current on your tax returns.
 
For example, you can't call and work out an arrangement for a 2015 tax bill if you haven't filed tax returns for 2016, 2017, and 2018.
4. The IRS Cuts Deals
The IRS has several programs that can help you get back on track.
 
The IRS offers payment plans, partial pay installment agreements, currently non-collectible status, and an Offer in Compromise.

For those who qualify, the currently non-collectible status stops collection activities such as bank account levies and wage garnishments.

An offer in compromise is an agreement with the IRS where the IRS agrees to settle your tax debt for an amount less than what you owe.
 
The requirements are rigid, but if you qualify the results are incredible.
Questions about back tax issues? Request a Free Consultation.

Meet Brandon Lindsay, CPA

When people come to me, they often feel lost and discouraged. There is nothing like seeing the relief on a client's face when they get out of a seemingly never ending tax nightmare. I deal with the IRS head on, so you do not have to alone.
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Note: Brandon Lindsay, CPA, is the founder of Lindsay Accounting LLC (dba Indy Tax Help), an Indiana CPA firm.

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