Expert Guide: What to Do When You Owe the IRS But Can't Pay Your Tax Bill
Friday, 8 March 2024, 15:30
Owing the IRS: Consequences and Options
Owing the IRS can lead to severe penalties and even legal consequences. It's crucial to address your tax situation promptly to avoid further issues.
Don't Ignore Your Tax Bill
- Penalties: Failure to pay penalties can reach up to 25% of your unpaid taxes, while failing to file on time incurs an additional 5% penalty.
- Warning: Tax evasion can result in fines and imprisonment.
Repayment Options
- Short-term Plans: Offer up to 180 days to repay in full, with no setup fee.
- Tip: Consider a long-term plan if you owe less than $50,000.
- Long-term Plans: Monthly installments via various payment methods, subject to fees and penalties.
- Insight: Explore an offer in compromise to negotiate payment terms based on your financial situation.
Contact the IRS or a tax professional for tailored advice on managing your tax debt.
This article was prepared using information from open sources in accordance with the principles of Ethical Policy. The editorial team is not responsible for absolute accuracy, as it relies on data from the sources referenced.