While ‘Currently Not Collectible’ (CNC) status can provide considerable financial relief to some struggling taxpayers, it’s not a viable option for everybody. What’s more, CNC comes with its fair share of downsides. Whether you fail to qualify for CNC or prefer to take a different route, it’s important to get a better sense of your full range of options, a few of which are outlined below:
Installment Plans
If you can make monthly progress towards eliminating your tax debt, your best bet may be an installment plan. A variety of installment options are provided to ensure your ability to make monthly payments. The IRS encourages direct debit plans, in which your monthly installment is taken directly from your account. This reduces the risk of late payments and plan defaults. Otherwise, it’s also possible to pay installments via check, money order, or credit card.
Offer in Compromise
In select circumstances, the IRS allows delinquent taxpayers to settle their debts for far less than they actually owe. Known as an Offer in Compromise (OIC), this option may provide the incentive needed to get your tax debt under control. While the majority of OIC applications are rejected, the potential for significantly reducing your tax burden makes this an enticing option.
Payment Extension
Typically, IRS extensions grant additional time for filing your return — not for covering your balance. In some circumstances, however, payment extensions are available. These typically last up to 120 days. During this time, interest and late fees will accrue.
Whether you prefer to take the CNC route or are determined to pursue an alternate option, you can count on Highland Tax Resolution for help. Call 720-398-6088 today to learn more about our services.