Paying the taxes you owe is imperative. Paying your taxes is a legal imperative as well as a civic responsibility. Fortunately, it's never too late to pay the IRS what you owe. If you owe back taxes, you may need the assistance of a tax firm that can help you with your tax resolution. Here are four steps a tax specialist may suggest that you take to resolve your tax status:
1. File your taxes if you haven't already done so
The first thing you must do when facing unpaid taxes is to make sure that you've filed all your taxes. If you've neglected to file previous years' taxes, you should do that as well. You may face penalties for filing late, but it's always better to file your taxes late than not at all. Filing your taxes can save you from legal repercussions. It can also help your tax specialist accurately assess the amount of money you owe the IRS.
2. Make a tax repayment plan with the IRS
If you haven't paid your taxes in a few years, you may owe the IRS a sizable sum of money. Fortunately, you may not have to pay the entire sum at once. A tax repayment plan can allow you to repay your taxes in monthly installments. Your tax resolution expert can help you come up with a viable repayment plan that will stop you from accruing fees while you pay your debt.
3. Apply for an extension
If you're unable to pay the taxes you owe right away but anticipate being able to do so in the future, you have the option of applying for a repayment extension. Your tax specialist can help you determine if this is an option for you. The extension is called a hardship extension, and in order to take advantage of it, you must meet certain criteria. If you can prove that you're facing financial hardship, you may be able to delay tax payments without incurring additional fees and penalties.
4. Take out a loan
If you've exhausted your other options, you may want to consider taking out a loan that will allow you to pay some or all of your outstanding tax bill. While borrowing money isn't usually ideal, it may be a better option than remaining in debt with the IRS. The IRS can garnish your wages or take out a lien on property or assets that you own if you fail to pay in a timely manner. You'll want to avoid these unnecessary complications if possible, and a loan with favorable terms can help you do so.