You Just Filed Your Taxes and You Owe a LOT of Money: Now What?

Realizing you owe the Internal Revenue Service (IRS) money can be scary and stressful. Still, you don’t want your tax issues to get any worse, so getting a plan of action in order is essential.

First of all, don’t panic. Take a deep breath and approach the situation with a clear head, so you can come up with the best solution. Once you get into the details, the problem may not be as bad as it seems. To put you in a pro-active state of mind, read the Taxpayer Bill of Rights, so you know your rights as you proceed.

Here are some other tips to follow as you work on getting square with the IRS:

  • Don’t ignore the problem. Although it may be tempting to put it aside and just hope it just goes away, it won’t, so start working on a solution as soon as possible. Facing the issue will not only ease your mind, it will also help avoid potentially devastating late penalties and interest.
  • Come up with a payment plan. In most cases, the IRS will work with you to pay your debt in installments, though, generally, it requires a sizable sum up front. The IRS may also consider an “offer in compromise,” which can adjust the total amount you will pay. This option usually isn’t available to those who can pay the amount due in installments over time, but if you aren’t able to pay, it may be worth exploring.
  • Hire professional help. Especially if the IRS says you owe a large amount of money, an experienced tax professional can be invaluable. Tax issues are nothing to mess with, as they can quickly affect all aspects of your financial life. A tax professional can verify your debt—even the IRS makes mistakes! —and then work with the IRS on your behalf, to come up with the best solution for you.

If you owe a lot of money to the IRS, call us at 720-398-6088 or send a message today to discuss your options.