Strategies For Paying Back Taxes
Getting Out of Debt to the IRS as Quickly as Possible!
According to Investopedia, over 8 million Americans fall behind on their taxes each and every year ‐‐ for an annual grand total of more than 83 billion dollars in money owed to the IRS. Tax delinquency can happen to anyone; but it can be helpful to categorize this problem into two distinct groups.
- • Business owners and freelancers, who are obligated to to pay their own taxes. Many times, due to financial problems or mere procrastination, they do not do this on time.
- • Traditional employees who file 1040EZs. Although such employees usually expect to receive money back from the government after filing taxes, they may end up owing money due to a problem known as underwithholding.
If you are interested in learning more about either of those situations, we recommend following the links above.
However, if you are currently in debt to the IRS, your main concern is probably getting out of debt ASAP! If so, then here are a few tips we recommend:
- •If you have not yet filed, then file as quickly as possible. The interest incurred on taxes that have been filed on time but not paid is quite reasonable. The interest incurred on taxes filed late, on the other hand, is even higher than credit card debt in most cases!
- • If you cannot pay, communicate! The IRS is not that different from any other "normal" debtor. Their main priority is simply getting paid. So if you find yourself unable to make payments on time, contact them and set up a payment plan! Short term extensions are also available in some cases.
- • An Offer in Compromise (IOC) may also be an option. If, due to financial hardship, you are truly unable to pay your outstanding debts, then the IRS may be willing to settle for less.
- • Consider seeking help from a professional debt relief service. Contact Madison Monroe and Associates to learn more about getting out of debt and regaining financial freedom!