We live in a pay as you go tax system. If you are a W2 employee, your taxes are taken out with each paycheck. If you receive 1099s or own a business you should make estimated tax payments quarterly. However, things do not always work out this way. This year we have an expected 28-million taxpayers who will owe for the 2015 tax return. What can you do if you can’t afford to pay? Well, an ETP might be a great option for you.
Do you need a little more time to gather the money?
If you are unable to pay your IRS balance by the due date and have received a notice of deficiency or similar notice, you may be eligible for getting an extension of time to pay. That’s right! There is a program out there that gives you a FOUR MONTH EXTENSION TO PAY!! If you need a little more time than that, this may still be a good option for your situation. Using an ETP along with another alternative arrangement to start streamlining payment arrangements could be just the tool you need to resolve your IRS balance.
Pros of using an ETP
- Gives you time to gather funds and avoid liens and levies
- This may be a tool to use to release current liens and levies
- No Fee to set up this qualifying agreement
- Can be used in conjunction with a First Time Penalty Abatement
- Avoid having to make a financial disclosure to the IRS
- Can be used to get balance below 50k then streamline
- Can be used to get balance down and then enter into another program
- Can work for individuals as well as businesses
Keep in mind this does not stop the interest and penalties from hitting your account, it just provides you some extra time to get the balance owed. Sometimes taxpayers would rather pay around 4% just to have some breathing room. Also, after you get the balance down, if your record is clear for the last few years you may be eligible to abate some of the penalties.
If you have questions about this or other alternative arrangements on an IRS or State bill, please feel free to call 410-793-1231 or click the below button to discuss your eligibility.