Are you looking for a way to settle IRS debt? There are many ways you can do this, with some being more common than others. Before you do anything, it is important that you know which steps to take and how you are going to reach the best end result. The last thing you want to do is confuse yourself and make the process more complicated.
Here are four steps to follow if you are interested in settling IRS debt:
- Are you being audited? Did the auditor determine that you owe the IRS additional money? If so, you need to ask upfront for the reduction or elimination of any penalties or interest that has accumulated. If the auditor believes that you made an honest mistake, there is a very good chance that they can wipe out any penalties or interest. But remember this: you never know if this is a possibility until you ask.
- Do not fight against all of the adjustments that the auditor has suggested. If you are irrational, it may show that you are trying to hide something. Your goal is to settle IRS debt for as little as possible. There is no way you are going to have all your debt eliminated. Be reasonable during your negotiations, while attempting to save as much money as possible. Just make sure you are willing to negotiate, as opposed to fighting for every last dollar.
- As you negotiate, do not speak about dollars and cents. Instead, use terms such as disallowances and adjustments. These are the terms that the IRS uses, day in and day out, so your auditor will be much more familiar with them. If you can back up any of your claims with records, it will make it much easier for you to negotiate with the IRS.
- Make sure you keep detailed, accurate notes of your negotiations with the IRS. Remember, this is a process that unwinds over an extended period of time. Do not be surprised if it takes several months, or longer, before your tax settlement comes to an end. You need to take notes on all conversations that you have. This should include everything that was said, as well as the name and contact information of the person you have communicated with. You never know when you will need these notes in a future conversation.
Along with the four steps above, it may be easier to settle IRS debt if you hire a tax professional. The reason for this is simple: a professional knows how to deal with the IRS, and the best ways of saving you the most money. If you are unsure of what you are doing, hiring a tax professional to work on your behalf may be the best move to make.
With these four steps you should be able to settle IRS debt. In the end, this means that you will pay the IRS less than what you actually owe. Any money that you can save should be considered a big win!