One of the biggest mistakes taxpayers make is failing to pay their back taxes. This is a common problem for many Americans, especially those who are self-employed or have multiple sources of income. When you owe back taxes, it can be tempting to ignore the problem and hope it goes away, but this is not a good strategy and will just make the situation worse.
In this blog post, we will discuss the consequences of avoiding paying back taxes and what you can do to resolve the issue.
Consequences of Avoiding Paying Back Taxes
There are several consequences of avoiding paying back taxes. The first and most obvious consequence is that you will incur interest and penalties on the amount you owe. The longer you wait to pay, the more interest and penalties you will accumulate, making it more difficult to pay off your debt.
In addition, the IRS can impose liens and levies on your property, including your wages, your home, car, and bank accounts. This can make getting credit, selling your property, or accessing your funds extremely difficult.
Another consequence of owing the IRS is that it may damage your credit score, making it harder to get approved for loans, credit cards, and other financial products.
How to Resolve Back Tax Issues
If you owe back taxes, it is important to take action as soon as possible. The longer you wait, the worse the situation will become. Here are some steps you can take to resolve your back tax issues:
Seek professional help – Do not contact the IRS alone. That’s like going to court without a lawyer. In some cases, you can reduce the amount you owe to the IRS but only a tax resolution professional can help walk you through the maze of dealing with the IRS. If you need help with how to proceed or need help negotiating with the IRS, consider seeking professional help from a CPA, Enrolled Agent, or an attorney who is also a tax resolution expert.
When you are working with a tax resolution specialist firm like ours, we can help you as there are a number of options to resolve your back taxes. The good news is the IRS has several debt settlement options including their Fresh Start Initiative and is generally willing to settle with taxpayers who can prove that don’t have the funds to pay the IRS in full.
If you owe back taxes, it is essential to take action as soon as possible to resolve the issue. The IRS offers payment plans and other options for taxpayers who are unable to pay their full tax debt. By working with a tax resolution specialist, you can resolve your back tax issues and avoid further problems in the future.
If you need an expert tax resolution professional who knows how to navigate the IRS maze, reach out to our firm and we’ll schedule a no-obligation confidential consultation to explain your options to permanently resolve your tax problem. Contact us here.