IRS Installment Agreements
If you have a tax liability and cannot pay the entire amount at once, you have the right to pay the liability in monthly installments based on your ability to pay. When the IRS sends a notice of your tax liability to you, if you do not respond to the first notice or subsequent IRS notices, the IRS will consider your account to be delinquent. Tax liabilities that the IRS considers to be delinquent are generally turned over to the Automated Collection System (ACS) or to the Collection field function. A Los Angeles tax attorney can negotiate an IRS installment agreement on your behalf to obtain an affordable payment plan taking into account your standard of living.
ACS is a network of call centers and agents across the nation that you can call and that can access your tax account. They can establish installment agreements for taxpayers. On the other hand, an IRS revenue officer, or RO, is a local IRS collections agent who is assigned to work with the taxpayer to obtain a collection strategy. The IRS has power to levy assets and bank accounts, to assert liens, and to summons financial documentation from the taxpayer to collect assets from the taxpayer to satisfy the liability.
If I Have an IRS Tax Liability, What are my Options?
There are a number of payment solutions that the taxpayer can utilize to resolve their tax liability and work out a solution that works best for the taxpayer:
- Extension of time to pay your tax liability — You may be eligible for an extension of time to make a payment to the IRS. This strategy can be beneficial for a variety of reasons.
- Delaying Collection (currently non-collectible status or CNC) — If the IRS determines that you are unable to pay, it may delay collection until the taxpayer’s financial condition improves. This can be a welcome reprieve. The IRS will monitor the taxpayer’s income from time to time to determine if taxpayer still qualifies. To qualify for CNC, the taxpayer generally must establish that he or she does not have the ability to make any payments.
- Offer in Compromise — You may be able to settle your tax liability for less than the amount you owe by submitting an Offer in Compromise (OIC). You will need to demonstrate that the IRS’s reasonable collectible potential is lower than your total tax liability. The reasonable collection potential is based on your monthly net income and the equity in your assets. If you have questions about an offer in compromise, call the Los Angeles tax attorneys at Disparte Tax Law today for a free consultation. Also, please read more on our website about IRS offers in compromise.
- Collection Due Process– If you or your business have received a final notice of intent to levy, you may request a collection due process hearing. A CDP request stops all collection action by the IRS revenue officer and allows the taxpayer time to prepare a vigorous defense to any unwarranted and unjustified enforced collection activities. Once the CDP request is processed, the IRS will assign a settlement officer to review the case history and revenue officer’s actions. Moreover, when a settlement officer makes a decision, he or she prepares a notice of determination. Thereafter, you can file a Tax Court petition to have the Tax Court hear the petition.
Contact a Tax Attorney for IRS Installment Agreement Representation
If you or your business have a tax liability and need fast and effective advocacy, call a Los Angeles IRS tax defense attorney at Disparte Tax Law for a free consultation. We have a wealth of experience in negotiating with the IRS and are skilled in tax procedure to protect and secure your business and livelihood.