If you pay them a down payment, which can be thousands of dollars, these companies claim that they can reduce or even eliminate their tax debts and stop back taxes. Help options available through the IRS usually include a payment plan or negotiating a debt settlement, also known as a commitment offer. The best option for a tax debtor depends on their specific financial situation. What is tax relief? Tax relief does not necessarily mean eradicating your monetary obligation to the IRS.
Instead, tax relief is about finding a way to set up a payment plan that works for you or to alleviate some of that debt. If filling out your tax returns is a relatively simple process, applying for any of the IRS's tax debt relief programs could be considerably cheaper than paying for the services of a tax debt relief company. However, as the Federal Trade Commission (FTC) warns, not all tax relief companies take your interests into account. In addition, any tax refunds you receive in the future can be used to pay off your debt while you are in CNC status.
Tax debt relief refers to a series of measures and strategies that help people pay or reduce their tax liability. A case manager will review your current tax debt and other financial details and provide you with an estimate of your services. Community tax relief focuses on relieving IRS tax debt, although it also offers limited state tax assistance. Any reputable tax relief company will first obtain key financial data from its customers before offering them a realistic assessment of what they can do for a reasonable fixed fee.
Some licensed tax professionals offer guaranteed assistance if your tax returns are audited. If you're looking for professional help with your tax debt problems, you're probably most interested in consulting a tax relief company. In addition, see our article on the Fair Tax Act to learn more about the proposed bill and what a national sales tax would look like. The IRS Office of Professional Responsibility focuses on questionable practices in the tax debt resolution industry.
You pay the tax advisor an additional amount up front and the tax advisor is committed to helping you resolve any tax audits that may arise in the future, usually up to three years. However, Victory Tax does manage common IRS tax debt relief options, such as commitment and installment agreements, but not relief for innocent spouses. Their 30-day money-back guarantee is also quite generous, as many, but not all, tax debt issues can be resolved within three to four weeks. Tax debt relief companies evaluate the details of your case and review the Fresh Start guidelines, which help you find the relief options for which you qualify.
To resolve this dilemma, which can trigger a major financial crisis, a new type of business has emerged to help delinquent taxpayers cope with their tax debts.