Things You Can Do About Your Back Taxes

Posted on 16. Sep, 2011 by in IRS

Times are financially difficult, both for our nation and individual households, and things can become even more difficult when you have to deal with your back taxes.

How you wound up having a problem with your back taxes is one issue. You should try to correct any mistakes and be sure not to repeat them in the future.

But you still have to clear things up with the Internal Revenue Service and our nation’s tax collector seems to really be trying hard to help individual taxpayers.

What assistance can the agency offer regarding your back taxes?

First, it will work with you to ensure that, in fact, you owe delinquent taxes.

A letter or notice from IRS will give specific instructions on what you are asked to do to resolve the matter.

If you receive a correction notice, take the time to review the IRS notice and compare it with the information you inserted in your federal income tax return. If you agree with the correction, you may not have to reply unless a payment is due or you are instructed to contact the agency.

On the other hand, if you disagree, you should respond as soon as possible. Explain in writing the basis for your disagreement and include any back-up documentation you may have.

It is best to give IRS a minimum of 30 days to reply. But even though the wait can seem too long, keep in mind that the agency is looking for an equitable way to deal with your back taxes.

According to IRS, most agency correspondence can be handled without the need to telephone or visit an IRS office. Just remember to keep copies of everything you send to them.

At the end of this process, you may face a bill for your back taxes. If you can’t handle it all at once, there are various possibilities for you to pursue.

You may want to contact a tax professional, either a certified public accountant (CPA) or a tax attorney.

If you think it is best to just pay off your back taxes, IRS may allow you the opportunity to enter into an Installment Agreement or an Offer in Compromise.

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