Contact the IRS
The first thing you need to do is contact the IRS directly. Most people don’t know that the IRS will never contact you by phone or email first. They will send you a letter through the mail that states that you need to contact them.
You want to contact the IRS to find out if you really owe back taxes, how much you owe, and what needs to be done to resolve the situation. There are many times when scammers will contact you and claim that you owe in an effort to get money from you.
If the IRS agent you speak to says that you do owe money, ask why you owe it. The agent should be able to give you intimate details regarding your specific situation so that you can then handle them properly. If they are vague about anything, hang up and contact the IRS number on their website directly.
Gather All of Your Financial Paperwork
You need to have someone look over your financial information before you pay any of the back taxes that the IRS claims you owe. Gather all your financial paperwork so that you can provide proof of how much money you make each year, what property you own, and if you have any investments that need to be accounted for.
If you don’t have the originals for any of this paperwork, you may want to get them just so that you can prove that they have not been altered in any way. You also need to provide that accountant with all of your tax filings for the past few years. This allows them to see if anything changed and if you have been making the same mistakes year after year.
Hire a Professional Accountant
Next, you need to hire a professional accountant to look over your paperwork for you. They need to see the tax filing that you made to the IRS and all of the financial paperwork that you gathered. They’ll know the ins and outs of the tax codes to ensure that you applied for all deductions you’re entitled to and see if you made any mistakes when you filed your taxes.
If you did make mistakes, the accountant will know what needs to be done to rectify them. You may need to file different paperwork or submit proof for the deductions that you did claim.
Apply for Tax Relief
There are some tax relief programs available that can help you to pay instalment loans for the money that you owe if the IRS has determined that you owe a large sum of money. Unfortunately, there are certain stipulations, like location and income, that you have to qualify for.
Let’s say you live in Arkansas: there are many Arkansas tax relief programs in place that may be able to help you reduce the amount of money that you have to pay in taxes. An accountant can help you determine which programs are available to you in Arkansas based on your current situation. What might work in California, won’t work in Arkansas, so having a professional help you can make all the difference.
You need to make sure that you meet the criteria for the specific relief you are applying to get to ensure that you better your chances of being approved for it. It’s best to allow your accountant to file for everything for you so that you can ensure it is done properly the first time.
Contact the IRS Again
Once you’ve determined what mistakes were made, you need to contact the IRS agent again. He or she will let you know how to submit the evidence that you have to prove whatever issues you have discovered. This allows you to possibly reduce the amount that you have to pay. It will take time for the agent to determine if your deductions are suitable and if the relief has been accepted.
Negotiations Can Be Made
If you’re upfront and honest with the IRS about your current situation, they may be able to work with you to negotiate a settlement amount that is less than the actual debt that you owe. If they do negotiate with you, you’ll have to pay the amount that is agreed upon in full in order for the agreement to stay in place. If you fail to pay the amount, the agent can take immediate actions to get the money that is owed and may not work with you again in the future.
Taking Steps Right Away is Essential
It’s important to get started right away. If you try to ignore the notice that you owe back taxes, you could end up with more issues than you had originally . The IRS can get their money in many different ways. They can put out a tax lien on your property so that when you go to sell, the money that you owe is taken out before you ever see a dime from the sale. They can also garnish your paychecks so that you lose money before you’ve get paid.
Hiring an accountant can cost a lot of money, but it’s well worth the investment if they can save you from a lot of the hassle that the IRS can cause to your life. Most accountants are able to take care of things in a very short period of time so that you can get on with your life and not have to worry about dealing with the IRS again in the future.