Like clockwork, when tax season comes, the Google searches for tax help questions start filling browsers. Can you guess what the most frequently searched tax question is? If you guessed, “When are taxes due?” you’re right! Do you know the answer? It’s typically every April 15th, with the exception of the 15th landing on the weekend. If this is the case, then it moves to the next business day. In 2021, things are a bit out of the norm because of the pandemic, so taxes are due on May 17th. They wanted to give taxpayers extra time to prepare because of the unusual circumstances the pandemic created.
The questions don’t stop with, “when are taxes due?” The list goes on and on and on. Instead of spending hours searching for all of your tax help questions, we’re hoping you can find what you’re looking for here. This Tax Help Guide is designed to answer the most commonly searched-for tax questions people ask and search for every year.
In this ultimate tax resource, you’ll find answers to questions like:
Don’t need answers to every question on our list? No problem. Just click on your question, and we’ll take you directly to that question and answer within the tax help guide.
Who can I call with a tax question?
Did you know the IRS reports that it gets more telephone calls the day after President’s Day than any other day of the year?
If you’re one of the hopefuls directly calling the IRS, don’t hold your breath. The agency’s funding issues and shift in resources to handle new tax law and backlogs means it’s likely your call will go unanswered.
For perspective, a 2019 IRS watchdog report noted that in the first week of the 2019 tax season, callers routed to an IRS reached a person 38 percent of the time. This was after an average wait of 48 minutes. The wait times are increasing, and the odds of reaching an actual person are decreasing. You’re probably ready to hear an alternative solution. Don’t worry, you have a lot of much less painful options.
Find Online Help
Check the IRS website. A major reason taxpayers call the agency is to ask about the status of their refund. For that, you can go to “Where’s My Refund?” on the IRS website (click Refund Status). The page is updated once every 24 hours. Backlog from the shutdown notwithstanding, the agency is still saying it will process most returns within 21 days, so wait about three weeks before you start checking. Always check the IRS FAQ page before picking up the phone.
You’ll find detailed information on numerous topics throughout the IRS website. It has a variety of interactive worksheets and calculators on subjects such as whom you can claim as a dependent, which filing status to choose, eligibility for education credits, and even whether you need to file a tax return at all.
Try a free DIY Tax Forum
If you’re a tax DIYer, your tax-prep software likely hosts an online forum that you access for questions. You can ask questions and get answers from tax experts or other seasoned DIYers. TurboTax even allows you to have your self-prepared taxes reviewed by a tax expert before officially submitting them.
Some free versions of online tax-prep products are now allow you to access their tax experts—CPAs or agents. H&R Block offers such a service through its free online product, allowing users to ask their questions via chat.
Get In-Person Assistance
Are you more of a face-to-face kind of person? No problem, you can go to an IRS Taxpayer Assistance Center. Speaking face-to-face with an IRS representative is possible, but of course, it’s not as simple as walking through a door and taking a waiting ticket. The IRS has eliminated walk-in hours at its Taxpayer Assistance Centers. You’ll need to identify the closest office to you and call 844-545-5640 to make an appointment. Hours are typically 8:30 a.m. to 4:30 p.m. local time Monday through Friday but can vary by office.
If you’d rather not jump through all of the IRS hoops to get in-person help, you’ll likely find dozens of professional service options in your area that provide in-person help.
Free Community-Based Help Centers
Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) are programs sponsored by the IRS and managed by trained local community volunteers. They can help you fill out your tax returns. Some are staffed by accounting students from local colleges and supervised by an accounting professor. The TCE program is available for taxpayers 60 or older. Most TCE services are operated by the AARP Foundation Tax-Aide program.
What if I Can’t Afford to Pay My Taxes?
Sometimes you can’t afford to pay your own taxes by the deadline. A lot of people face this problem. The worst thing you can do is avoid the issue and ignore it. You can’t hide from the IRS. The best thing to do is face the problem and exercise all of your available options.
The challenge is knowing where to start. Here are four steps that will help if you can’t pay your own taxes.
Step One: File by the Deadline
If you can’t pay for everything, you still need to file on time. If you can, work with an experienced tax professional to help you fill out your forms. Often they can find credits and deductions that can lower your tax bill. Later you’ll have to pay the penalty for not filing on time, and there is no advantage to filing past the deadline.
Step Two: Pay What You Can Now
Don’t drain all of your cash flow on your tax bill. Take care of your food, utilities, transportation, and living costs first. You don’t need to start racking up credit card debt. You can file a tax extension to give you more breathing room. You’ll have to pay interest for what you can’t pay by the deadline, but the interest is much lower than credit card interest. So pay the IRS what you can now, but always take care of the essentials first, and avoid credit card debt.
Step Three: Keep Paying What You Owe
After tax day passes, you’ll have a few months before the IRS contacts you about your remaining tax balance. During that time, keep paying off your tax bill with the goal of paying it off in full before they contact you. If you still have a balance, you can attempt to secure a monthly installment arrangement. However, it may not be that easy, as many taxpayers have found the process tiring and frustrating to try and work through on their own. The IRS’s job is to get as much as they legally can, so getting professional assistance for your negotiation is always a good idea.
Step 4: Make a Plan for Future Taxes
Find a tax expert you can trust to make sure you’re not in the same spot next year. They’ll help you figure out how much you should be setting aside each month, so you’re not facing another massive tax bill next year. Most qualified individuals working for a company can get their own taxes withheld in their paycheck, so they don’t need to worry about it. But if you have a business or side business, it will be up to you to determine how much to set aside.
Make sure to see what the IRS says to the question, “What if I can’t pay my taxes?”
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Can You negotiate with the IRS?
Yes, you actually can negotiate with the IRS. The IRS calls a negotiation “An Offer in Compromise.” It’s just a fancy way to say negotiate.
An offer in compromise is a way to settle your tax debt for less than the total l amount owed. The IRS takes several factors into consideration when determining if you qualify for a negotiated or reduced settlement.
Your ability to pay
The IRS will often approve an offer in compromise when the amount offered represents the most they can expect to collect within a reasonable period of time. They recommend you explore all other payment options before submitting an offer in compromise.
Offer in Compromise Eligibility
If you choose to attempt to negotiate you’ll need to make sure you’re eligible before starting the lengthy process. The IRS will reject your OIC application if you have not filed all required tax returns. You do not qualify if you are in an open bankruptcy proceeding. Use the IRS’ Offer in Compromise Pre-Qualifier to see if you’re eligible.
How do I Get out of Tax Debt?
Nobody plans on getting into tax debt, but it’s a common occurrence. If you owe back taxes, there are a lot of strategies you can use to get above water. The strategy you use will depend on your unique situation. The most common ways people get out of tax debt are by using an IRS payment plan, an IRS Offers In Compromise, and getting your account into Currently Not Collectible Status. We just discussed Offers In Compromise, so let’s take a closer look at the other two options.
What is the IRS Payment Plan?
An IRS payment plan is exactly how it sounds. In most cases, this will be your best path to getting out of tax debt. The IRS offers several types of installment plans.
Guaranteed Installment Agreement
– is an option if you owe $10,000 or less to the IRS. It’s generally easy to qualify for the plan. You must file all past tax returns. The previous five years must have been filed on time. You can’t have used an installment agreement plan within the past five years. You must be able to pay the entire amount within three years or less.
Streamlined Installment Agreement
– can be used for tax debts up to $50,000. The qualifications are similar to the guaranteed installment agreement. On this plan, you can make payments for up to six years. This was introduced by the IRS Fresh Start Program.
If your account goes into “Currently Not Collectible Status,” this is just a temporary hold. The IRS will not attempt to collect owed taxes until you resume a financially stable condition.
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Does the IRS forgive tax debt after 10 years?
This one is complicated, but yes, there technically is a statute of limitations on IRS tax collection. But it only goes into effect if specific criteria are met. Your tax debt can be canceled after 10 years if the IRS makes no effort to collect on your account and if you don’t contact the IRS. However, this is not as simple as just waiting a decade without ever paying what you owe.
The date begins once you receive written notice from the IRS concerning what you owe. For example, if you filed your tax return on April 15th, 2019, and got a notice in the mail dated June 1, your statutory period would have begun on June 1st. The date is called the CSED (Collection Statute Expiration Date). Some situations can also delay the CSED by halting the clock on the 10-year time frame. These include:
Filing for bankruptcy
Being outside the U.S. for at least six months
Submitting an offer in compromise to settle back taxes
Filing a lawsuit against the IRS
Having your assets held in court custody due to divorce, judgments against you, etc.
Having your assets held in court custody due to divorce, judgments against you, etc.
It takes six months after bankruptcy cases settle to get the clock restarted on the CSED. This means the IRS has more time to take collection actions against you, and the IRS will tend to ramp up these efforts before the statute of limitations expires.
Does State Tax Debt Ever Go Away?
Taxpayers who are subject to state income tax need to find out what options, if any, are offered by their state tax department. State tax departments may take harsher collection actions and have fewer options for taxpayers to settle back taxes or make payment plans. They can also have a much longer statute of limitations on collections. The IRS usually gets negatively portrayed in movies and on TV, but it’s the state tax departments that are more likely to show up unannounced or issue liens a lot sooner.
Should You Try Riding out The Statute of Limitations?
It’s very rare that anyone rides out the statute of limitations, and it’s usually due to extenuating circumstances like disability or a debilitating business closure. If enough time has passed that you think you might be able to go the whole 10 years without payments or responses to collection actions, you must keep detailed records of all correspondence with the IRS. It’s not recommended to intentionally try riding out the IRS statute of limitations without the guidance of a tax professional specializing in tax relief and resolution issues.
What is the IRS Fresh Start Program?
The IRS Fresh Start is not really a single program, but rather a series of changes the IRS has made to the tax code. The IRS has implemented several programs around Fresh Start since 2011. The idea is to make it easier for qualified individuals who owe back taxes to pay the IRS while avoiding a lien on their vehicle or home.
Today, the Fresh Start Program is no longer available, but many of the negotiating structures that were created for the program exist for taxpayers.
The program increased the threshold for a lien from $5,000 to $10,000. Taxpayers can also apply to have a lien withdrawn when their taxes owed are less than $25,000, and they agree to automatic installment payments. There are different tools available to help struggling qualified individuals and small businesses pay off and/or eliminate some of their debt. The goal is to allow citizens to pay taxes without liens and excess fees. The current program is now called the Fresh Start Initiative, formerly named the Fresh Start Program.
Who Can Qualify for the Fresh Start Initiative?
Technically nobody can qualify for the program as it no longer exists; however, the programs left behind are still an option. Everyone is eligible for these programs once they jump through a few tax hoops. First, you need to get current. You must have filed all past tax returns, usually going back six years. The IRS will not consider anyone to be current if they have unfiled own tax returns, so they will not sit down to negotiate. If you’re currently in or pursuing bankruptcy, you will not be eligible for any of the programs. Self-employed qualified individuals must demonstrate a drop in their net income of 25 percent or greater. Earnings for married couples filing jointly must be under $200,000 per year, and single filers under $100,000. Finally, you must owe less than $50,000 dollars in taxes.
What do I do if I have been levied?
A tax levy is similar to a tax lien, but more serious. A levy is the seizure of property to pay taxes owed. Tax levies can include garnishing wages or seizing assets and bank accounts. Tax levies often come after a tax lien, but are not required to. A levy is really the exercise of the lien claim.
In most cases, if you’ve been levied, the IRS will contact your bank and place a 21-day hold on your account. If you cannot negotiate a deal with the IRS during that time, the bank may send some or all of your money to the IRS. Your house is another option, but the IRS would rather not go after your house because it makes them look bad in the public eye.
Not everything can be seized by the IRS. They can’t take unemployment benefits, certain annuity and pension benefits, disability payments, worker’s compensation, some public assistance payments, and child support payments.
If you disagree with an IRS employee’s decision about a lien or levy, you can ask for a conference with their manager. If you disagree with the manager’s assessment, you can ask the Office of Appeals to review your case. In some cases, filing for bankruptcy can get rid of tax debt, but it’s a long process, and doesn’t always work out.
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What is a Tax Debt Relief Company?
Working your way through the complex web of tax laws can be a time-consuming and exhausting task. With so many requirements, forms, and needed paperwork the IRS requires it can quickly get overwhelming. You have a lot of questions but finding consistent answers feel impossible. A good tax debt relief company acts as professional guidance on your tax debt journey.
There are many solutions for tax debt, but knowing which one is right for you, and figuring out how to make it work involves layers of complexity. For some people, an Offer in Compromise makes sense, while for others, an installment agreement will work better. Another person might qualify for Innocent Spouse Relief, a Penalty Abatement, or Levy Relief. A combination of solutions might work best too.
Good tax debt relief companies will have a licensed tax professional look at your specific tax debt situation and determine the best one or combination of solutions to help you get your tax debt paid off. The IRS has a lot of resources and people power to get overdue taxes from people. They have incredible power to seize wages and property. However, dealing with the IRS doesn’t have to be stressful. You just need a good plan.
A tax debt relief company helps you develop a realistic plan. They take care of all the paperwork and negotiations with the IRS on your behalf.
Tax Help Resources
Here is a list of some of the most helpful tax resources in one place. Bookmark this article and come back here for easy access to all of your free tax help resources.