You may want to consider getting help with unpaid taxes before your debt spirals out of control. Working with a tax debt attorney or another professional could save money and avoid collection agencies. But it is never too late to ask for help. 

The best tax relief help for you depends on a few factors, like how much you owe, how much you can afford, and the duration of time you have owed money to the government. A payment plan may be an option if you have manageable debt. You may need to request IRS debt forgiveness if you owe an exorbitant amount. 

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When You Might Consider Seeking Tax Debt Relief Help
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The IRS is responsible for verifying your taxable income, collecting owed taxes, and sending notifications of debt. The IRS has the following six categories of tax debt:

  • Liable is when you owe taxes, but the IRS has yet to notify you of debt.
  • First notice is the first letter the IRS sends you about your tax debt, which should include an explanation, the balance, and any accrued interest or late penalties. This notification is the agency’s first request for full payment. 
  • The IRS sends second and subsequent notices through different means to collect payment.
  • The IRS then usually files a Notice of Federal Tax Lien if you do not pay the amount in full. A Notice of Federal Tax Lien may affect your credit and ability to obtain loans and other debts. The government removes the lien 30 days after you have paid in full. 
  • Collections are the process of obtaining payment. The IRS may keep any future tax refunds, send a Revenue Officer to your home or workplace, and deduct money from your paycheck or other government payments, like subsidies and stimulus checks.
  • ·Serious Delinquency is when you owe at least $55,000. The government could confiscate, deny, or revoke your passport, or it may place limitations. 

Your unpaid tax debt is subject to daily compound interest and monthly late payment charges. Paying your debt as soon as possible may help you minimize these extra fees. 

Several entities offer tax debt relief help, from tax attorneys to preparation organizations. Tax debt help companies can often negotiate with the IRS, request extensions, and prevent wage garnishment on your behalf. They may also help with an audit or tax lien. However, keep in mind that third-party organizations may charge a one-time or monthly fee for services.

Some tax debt relief groups have a minimum tax debt requirement, meaning they will only take your case if you owe more than a certain amount. Using these services can cost hundreds to thousands of dollars, so you should only consider seeking help if you owe a significant amount. 

You may avoid the expense of tax debt relief lawyers by contacting the IRS promptly. The government can work with you to collect owed taxes and may offer payment plans and debt forgiveness. 

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