Forced to Add to Your IRS Debt This Year? Do’s And Don’ts For Restructuring Your Installment Agreement
Digging yourself out of an IRS tax debt hole can feel impossible even when you have just one year’s worth of debt. This struggle becomes especially overwhelming when you’re forced to add to your debt burden.
If you’ve already developed an installment agreement, however, it’s possible to modify it to account for your added debt. Keep these do’s and don’ts in mind as you proceed with caution:
Do: Be Proactive
The more initiative you show, the better. Your chances of securing a favorable arrangement are far greater if you’re open and honest about your situation. It’s in the best interest of the IRS to get you paying something, so you may be able to adjust the terms of your plan.
Don’t: Let Your Agreement Go Into Default
The consequences for defaulting on an installment agreement can be harsh; you may be forced to pay the remainder of your tax debt in a lump sum or even commence collection activity. Make every effort to avoid defaulting.
Do: Be Realistic About What You Can Handle
While paying off your tax debt aggressively can help you avoid extra penalties, you’ll want to think carefully about what you can actually handle at this time. If the financial difficulties that have caused you to acquire even more debt this year persist, you’re likely to struggle with higher installment payment.
Don’t: Be Afraid to Get Help
A tax resolution service can be an invaluable resource as you navigate the complexities of the IRS. An enrolled agent can help you arrive at a solution that allows you to make significant progress on multiple years’ worth of tax debt — all while keeping the IRS off your back.
As you navigate the process of setting up or amending an IRS installment agreement, don’t hesitate to seek guidance from the Highland Tax Group. We are here to streamline the process and help you bring IRS tax debt issues to a close.