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3 Tips to Manage and Get Out of IRS Debt


Owing money for taxes that you don’t know how you will pay off can be unsettling. With 11.23 million Americans owing money to the IRS, you are not alone. While it may feel like a hopeless battle to get out of debt you owe the IRS, it is not an impossible feat.


Orange County tax resolution firm Morgan Sebastian Law has extensive experience in helping clients resolve tax debt. The following tips will not only help you get out of your debt owed to the IRS but may also help you avoid future tax issues. Do not let tax debt take hold of your life. Consider these tips and get your financial goals back on track.


1. Do Not Ignore Filing Your Taxes

Even if you’re not sure how you will pay your taxes, it’s important to file them anyway or apply for an extension. If you do not qualify for an extension, be sure to file them on time to avoid penalties. Avoiding filing your taxes altogether will make your tax issues worse in the long run. When you file taxes late or not at all, you may face the following penalties that will only increase your debt:

  • Late Filing Penalty: five percent of the tax owed up to 25 percent of the total balance

  • Underpayment Penalty: 0.05 to one percent per month of the balance due

You may be able to avoid penalties and lessen the burden of your tax debt by speaking with a tax resolution attorney who is familiar with current tax laws. At Morgan Sebastian, we offer free consultations.


2. Consider Your Payment Options


After 120 days have passed, the IRS will provide a few options for you to repay the balance you owe. They include the following:

  • Payment Plan: If you owe less than $50,000, then a long-term payment plan may be your best option. However, it is important to note that you may be subject to penalties and interest if you need longer than 120 days to repay what you owe.

  • Delay Payment: If you can prove that paying your debt would leave you in a position where you cannot pay for basic living expenses, you may get a delay on your payment deadline. However, do not mistake this delay as your debt being forgiven. You will still have to pay up eventually.

  • Settle: If you can prove that paying what you owe would cause financial hardship, you may be able to compromise and pay less than you originally owed. You will need the help of a skilled tax settlement attorney to help you through this process.

3. Get Help from a California Tax Resolution Attorney

Navigating your options when it comes to repaying tax debt can be difficult. If you owe more than $10,000, then hiring an experienced tax attorney is crucial to negotiating your debt with the IRS. Some benefits of hiring a tax attorney include:

  • They can help you get better terms for your payment plan

  • They can help you avoid a tax lien being placed against you, which can damage your credit

  • They can give you peace of mind as you attempt to manage your debt

Hiring a tax resolution attorney is valuable to your pursuit of a debt-free future.


Orange County Tax Resolution Attorneys Can Help You


Dealing with debt owed to the IRS can be stressful and frustrating. Like some creditors, the IRS can be relentless and will keep trying to collect what you owe. Do not let your debt get to that point. Morgan Sebastian Law will help you find a solution to your debt.


Voted as the Expertise Best Tax Services in Orange, California, you can trust you are in good hands with Morgan Sebastian. Prevent your situation from getting worse or reoccurring. Contact us today by clicking here or call (877) 223-6605.