That's because the IRS determined that those families didn't have to pay taxes because of their financial situation. If you can no longer afford a large tax burden, the IRS may offer you different avenues to follow. This type of program was designed as a way for the IRS to maximize the collection of the amount of tax money owed to the government while making it much less difficult for the taxpayer. You can also apply for the IRS debt forgiveness program if you are self-employed and have experienced an income loss of at least 25%.
Fraudulent tax debt relief companies often request an advance payment and claim that your tax debt is erased when you request their help. You should also be up to date with all your tax returns, the required estimated payments for the current tax year and receive the invoices for which you plan to apply for an OIC. The relief or forgiveness of the IRS tax debt allows taxpayers who owe unpaid taxes to reduce part of their debt, depending on their circumstances. With a diversity of backgrounds, the tax debt relief professionals at Clean Slate Tax have more than 25 years of combined experience and can solve most state and IRS tax problems.
To find out if you're eligible for the IRS debt forgiveness program, you must review your case. However, for these ineligible penalties, taxpayers can use existing relief procedures, such as requesting relief based on reasonable cause criteria or the First Time Abate program. The incorporation of these programs into the tax code indicated to many that the IRS was seeking to be a little more flexible in recovering more money owed to the government. The penalty is generally applied at a rate of 5% per month, up to 25% of unpaid tax if the federal income tax return is filed late.
Keep in mind that the IRS will only consider you for tax debt relief if you have a good reputation with the agency. IRS debt forgiveness applies if the taxpayer can allege extreme financial hardship and if all previous tax returns have been completed. Programs like this allow taxpayers who owe back taxes to the IRS or who owe back taxes to the IRS or who have a debt to the IRS to settle for a smaller amount.