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Key Points:
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The IRS usually has 10 years to collect your tax debt, plus penalties and interest.
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Dealing with a tax debt can be painful. But it’s better to get it over with sooner rather than later.
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Working with a reputable tax relief company can help you get a handle on your tax debt.
Tax debt is an uncomfortable financial obligation. While it’s tempting to put this burden off for another year, dealing with this type of debt should be a top priority. Unfortunately, this is an issue that won’t be resolved until you take action.
Let’s explore why you should close your tax debt before the end of the year. Plus, look at how you can move forward today.
Tax Debt Consequences
If you are carrying tax debt, you may face serious financial ramifications. It’s impossible to ignore your tax debt obligations because the IRS starts the collection process by sending you a series of tax notices.
If you don’t catch up on your tax bill, the IRS may choose to issue liens on your assets and levy your bank accounts. The IRS also has the authority to take your tax refund, seize your assets, and garnish your wages. Along the way, the IRS may add to your balance through penalties and interest charges.
Timing Matters: Consider Year-End Tax Debt Closure
The IRS deadline for collecting your back taxes is ten years. With that, the process can stretch out for years. Most taxpayers don’t want to deal with the IRS hounding them for years. The good news is that you can take action to resolve your tax debt.
As you explore your year-end financial planning, take time to consider your tax debt repayment strategy.
Tax Debt Resolution
If you are ready to close your tax debt obligations by the end of the year, you have several options. Below is a closer look at some of the strategies you could pursue:
Pay the balance in full: If you have the funds available, consider making a full payment to resolve your tax debt immediately. Repaying the balance will stop all collection activity from the IRS.
Consider an installment agreement: If you are unable to repay your tax bill immediately, an installment plan is an option. Eligible taxpayers can stretch out their repayments for months or years. This could present a manageable pathway to paying off your tax debt in the near future.
Tax Preparation & Relief Related Articles
How Much Do You Have to Make to File Taxes? Income Guidelines Explained
How to Open an Account With The IRS
Tax Season 2024: It’s Time to File
Tax Season Is Here: Learn Savvy Ways to Use Your Tax Refund
Make an offer in compromise: An offer in compromise involves settling your tax debt for less than you owe. If you are facing financial hardship or are unable to repay your total tax debt, this is a worthwhile option to consider.
Seek tax relief services: Some companies, like Anthem Tax Services, offer tax relief services. Taxpayers with tax debt could find a lot of value by working with this type of company. If you want to resolve your tax situation by the end of the year, Anthem Tax Services can help you explore your options, like tax debt relief programs and tax debt settlement. Plus, the company can help you navigate the path to a solution.
Takeaway
Resolving your tax debt is possible. If you want to resolve your tax debt by the end of the year, you have many options to consider. But seeking the help of a reputable tax relief company, like Anthem Tax Services, can streamline your path to resolving your tax burden.
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Personal Finance
Sarah Sharkey is a personal finance writer with a Master's in Management from the Hough School of Business at the University of Florida. She enjoys helping people make better financial decisions and has written for numerous personal finance publications, including Money Under 30, Business Insider, and The College Investor. Sarah enjoys traveling, hiking, and reading when she is not writing.
