When a business or taxpayer fails to pay all of their taxes on time, they owe a debt to the Internal Revenue Service. If your business owes IRS debt, severe consequences may result. The IRS charges interest and additional penalties for late payments, and they can also garnish your wages or take possession of your property if the debt remains unpaid for an extended period of time. In the worst of cases, the IRS may even press criminal charges.
Fortunately, owing a debt to the IRS doesn’t have to lead to trouble if you take the proper action. As soon as you know you won’t be able to pay the taxes you owe, you should begin seeking IRS debt help. The debt relief method you choose depends on your individual circumstances. For example, if you can show that you do not owe the taxes the IRS has assessed, the IRS may erase the debt altogether.
If you have financial problems that are preventing you from paying the debt, you may qualify for certain IRS tax debt relief options, such as Offer in Compromise. If you qualify for Offer in Compromise, you will make an agreement with the IRS that allows you to settle the debt for less than you actually owe. Before approving an Offer in Compromise agreement, the IRS will consider all of your available resources, as well as your expenses.