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American taxpayers owe about a half-trillion dollars in unpaid taxes. If the IRS were to be successful in collecting all of it, it would slash the federal deficit by half. For this reason, the IRS tends to vigorously go after taxpayers who either evade taxes or pay less than they owe.

If you owe significant back taxes and are having trouble figuring out how to pay, a tax relief company could help. While there are bad actors out there who claim to provide these services but don’t, legitimate services do help make your life easier in this area.

What does a tax relief service actually do?

When you find yourself considering a tax relief service, it’s important to understand these companies don’t give you access to special moves only a great expert would be capable of. They only use provisions in the tax code that you could try yourself if you had the patience and the inclination to study tax relief programs, figure out how to qualify, find out how to get in touch with an IRS agent, and negotiate with them. If you can’t see yourself doing this kind of work and repeatedly have to call IRS customer service (only a third of calls are ever answered), then, seeking out a tax relief service could actually be a meaningful thing to do.

A tax debt relief program can help you in a number of ways. You could get the IRS to give you more time to pay what you owe or ask the IRS for an installment plan. You may also apply for a tax reduction plan or a penalty abatement program that lowers any penalty imposed on you. The IRS is eager to help you find a way to pay early because they know that back taxes are far easier to collect in the first year than any later.

The trick, however, is to find a legitimate tax relief service. It’s generally a good idea to not go with cold callers but instead to find a good, well reviewed service that you look up on your own. It’s also important to make sure that you don’t go with a service that asks for payment upfront. When you find a good service, the tax professional assigned to you may be able to help you get the IRS to not take harsh steps against you, seize your property, garnish your wages, or impose heavy fines. In general, tax relief services cost a minimum of $2,000.

What kinds of tax relief can your agent help you apply for?

The IRS offers specific programs that taxpayers can apply for. When you work with your tax relief agent, they are likely to help you find the programs that you’re most likely to qualify for.

An installment agreement: If you owe less than $50,000 in back taxes and your tax submissions are all up to date, you could apply for an installment plan that lets you pay what you owe over a period of 3 or more months. Since you end up paying everything that you owe, this kind of tax relief doesn’t damage your credit score.

A CNC status: You may be able to apply to the IRS to be classified as a Currently Not Collectible account. You need to be able to prove to the IRS that you face serious financial difficulties. The IRS may agree to leave you alone until your circumstances improve. When they do get better, you’ll be liable to pay whatever back taxes you owe, together with interest and penalties.

An Offer in Compromise: An Offer in Compromise is an arrangement with the IRS in which you pay less than what you owe and have the IRS write off the rest of your tax debt. The IRS gets to collect something, and you come out of the situation having paid less. About a third of all such applications are approved by the IRS.

A penalty abatement: When you owe the IRS unpaid taxes, they can charge you interest on the debt at 5 percent. Fortunately, you can apply for penalty abatement and have the interest waived.

Tax relief is real, and the IRS offers several legitimate programs that you can apply for. However, you do need to make sure that you find a service with agents who really know their job. Understanding what tax relief can do for you, and finding the right people to do it for you, can help make your tax burden easier to handle.

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