Taxes are an important fabric of any society. They are obligatory payments made by citizens of a country to the government of that country. They are then used to fund public expenditures as well as government spending.
In most countries, there are a variety of taxes that citizens pay whether as individuals or as businesses. Not paying your taxes is illegal and you run a risk of getting arrested or convicted depending on how severe your case is. It is not uncommon to find people and companies who try to evade paying taxes but for some others, they get into what is called tax debts.
Tax debts are those taxes owed to the government after the deadline has passed for filing returns. It is when a person is behind in paying their taxes whether partially or fully and this is quite common. As of 2019 in the United States, around 11 million Americans had a tax debt. This is about 1 in 20 people.
Owing the IRS is not fun in any way. This can lead to the seizure of your assets or garnishment of your wages which will further complicate matters for you. When this is the situation, requesting tax relief is probably the best option. You can read about IRS penalties in this article.
What is Tax relief?
These are programs or policy initiatives by the government that are designed to lower the amount of taxes that is paid by individuals as well as businesses. It is more like setting up a plan for payment or negotiating some sort of settlement with the government. Relief intends to reduce the liability of an individual or business. It can be a targeted program that benefits a group of taxpayers or that helps the government to meet up with certain goals.
Tax relief does not mean that your debts are erased nor forgiven although this can occasionally happen but in rare circumstances. It only means that you get an easier way to pay it. It allows you to break down the payments or reduce the amount that you will pay. Often, it will make whatever you are paying manageable but it may cost you more to pay at the end of the day. Also, in cases of natural disasters such as wildfires or hurricanes, victims may be able to qualify for tax relief or an extension to pay their taxes. They may also be eligible to claim losses on their returns.
How Can A Tax Relief Company Help You?
Tax debt companies or services work on your behalf by negotiating with the IRS. When you hire a reliable company, they will contact the IRS and will try to negotiate a compromise such as an installment or interest-based abatement.
Some tax relief companies are disreputable and unreliable. They collect huge sums in upfront fees but they are mostly scams and won’t fulfill their promises. While this is true, there are genuine businesses out there who are trustworthy and reputable with a track record of success.
For this reason, when choosing a debt relief service, you need to be careful. If you would prefer a third party to liaise with the IRS on your behalf rather than do it yourself, ensure that you hire a reputable company.
Choosing a Debt Service Company
If you are already indebted to the IRS, you do not want to get into more trouble by hiring unreliable people to handle your business. This is why taking out time to research and choosing a good company is important. Below are a few tips that can be of help in doing so. You should choose a company that:
- Gets you involved in the process by educating you and providing you with information and resources that will be helpful.
- Offer free consultation
- Have great customer service.
- Are enrolled agents with the IRS and employ certified professionals such as attorneys, tax consultants and Certified Public Accountants.
Beware of those who charge high upfront fees, default billing rates and adverse refund policies. It is also recommended that you meet face to face before hiring anyone. This will help you to ask questions and learn about them before you enter into any agreement with them. You can check out http://www.taxdesk.com for more information.
It is pertinent to note that you can technically do by yourself what debt relief companies will do for you. The advantage of using them is that as experienced professionals, they are more knowledgeable and may be able to negotiate better on your behalf.
While it is important to pay your taxes, you may have fallen behind and this has resulted in debt to the IRS. Not to worry, there are options such as tax relief to help you find a way out. While you may be able to handle this yourself, it is better to use a debt service as they are more knowledgeable and experience in these matters.