What Is Tax Resolution? Everything You Need to Know


Did you know that in 2019 more than 61 million people visited the IRS for assistance with handling their taxes? That is almost 20 percent of the United States' population.

Taxes can be a confusing maze to try to navigate, and handling them wrong has some severe consequences, especially if you are behind on your bills.

Thankfully, there are tax resolution specialists out there that can help you through these difficult circumstances with your tax resolution.

Continue reading to learn all about what a tax resolution is, how it can affect you, and the tax relief that you can get.

What Is A Tax Resolution?

Tax resolution is a process that is handled by a tax resolution company to assist you with any debt that you have with the IRS. The goal is to minimize what you owe to the IRS as much as possible.

Tax resolution is usually needed when someone owes the IRS back tax and has put off paying it for a length of time. When the IRS runs out of patience, they will contact your bank in order to get a tax lien or bank levy to your property.

This allows the IRS to take your assets and use them as payment for the taxes that you owe them.

Signs of a Levy Heading Your Way

If you owe the IRS back taxes, then you likely have worries that a bank levy is heading your way in the near future. Luckily, there are some warning signs so that you have a heads up and can start to find tax resolution companies to help.

A big sign that a levy might be heading your way is a notice of action. The IRS can move forward with the levy process. The notice of action will be in the form of written notices that are addressed to the taxpayer who owes the money.

The good news is that you can contest and appeal these notices from the IRS with the help of a tax resolution specialist. Taking this action can prevent the levy from ever occurring.

If the levy does end up materializing or you start a payment plan, you are still able to have it released prior to the funds exiting your bank account.

Ignoring the IRS will only escalate the situation to the point of them sending IRS officers to your door. Working together with them is always the best step to take towards a resolution.

How Can a Tax Resolution Company Help?

Tax resolution specialists are qualified individuals who will inspect and assess your tax situation and speak to the authorities at the IRS on your behalf.

The key to a successful tax resolution specialist is knowing the ins and outs of a financial disclosure, as well as being able to determine the tax relief options you qualify for based on your financial situation.

Most taxpayers are eligible for an installment package. An installment package has you pay old taxes in addition to new ones.

This may sound daunting, but your tax resolution specialist will speak on your behalf and get you the lowest installment payments possible. The amount of the installment payments can have a massive impact on your finances and property.

If paying installments isn't an option, there are other alternatives that might be available to you. One of those alternatives is a partial pay agreement.

A partial pay agreement is similar to the installment package. With this type of agreement, you have the length of the statute of limitations to pay back the debt that you owe. That length of time can be as many as 10 years.

Because you have such a long time to pay back your debt, your payment installations are significantly lower. This can make the process of paying back what you owe much easier and attainable.

The downside to this plan is that the IRS inspects the situation every two years, and they can raise your monthly payment amounts depending on your situation.

If your financial situation does not improve by the end of the statute of limitations, your debt is erased and you will no longer have to pay the installations.

Another tax resolution option is "Currently Not Collectible". With this tax resolution option, the IRS collections are suspended. The IRS will assess your living situation and if your expenses exceed your income they will stop attempting to collect the debt from you.

Offer in compromise is also a great option for tax resolution. It can allow you to make an agreement to pay a lesser amount than what you owe on your taxes while still taking care of your tax debt.

Offer in compromise is similar to paying in installments in the sense that the IRS can still monitor your finances and decide to raise your payments on your debt.

How to Find the Right Tax Resolution Specialist

Finding the right tax resolution specialist for your situation is simple, but there are certain criteria that you should consider before hiring anyone. Some important factors to look at are their:

  • Experience and qualifications

  • Success rate

  • Tax resolution processes

  • Reviews, testimonials, and references

Doing the little things to make sure you hire the right person will save you money in the long run, and ensure that you get the best tax relief process for your situation.

Are You in Need of Tax Relief?

In today's economy, tax debt can seem like an unconquerable obstacle. Knowing your options for tax relief is a great tool to have at your disposal and tax resolution specialists are here to help.

If you are in need of tax relief or know someone who needs tax resolution, book your consultation online today.