By Kaeb Mils
If you have recently got a notice from the IRS for tax penalty, you might want to act on it fast. If you decide to ignore it, the IRS is liable to freeze your assets and use them for the payment of your tax penalty.
Options Available to Pay off Your Tax Penalty
If you live in New Jersey, you can hire reputable tax relief companies. Searching on the net for IRS tax settlement companies new jersey will offer you a list of firms in and around your neighborhood. Such companies can offer you different options on how to settle your debt with the IRS.
First and foremost, your tax settlement company will carefully analyze your financial records. They might ask you questions about why a notice has been issued by the IRS. After evaluating all your records, your firm will submit an Offer in Compromise.
An Offer in Compromise is an agreement between you and the IRS to settle your tax debts for less than the actual amount. The IRS will consider special circumstances and in very rare cases might agree to an Offer in Compromise.
If your agreement gets rejected, then you might need to enroll in an installment plan to pay off your tax debts. The duration of these installment plans is up to 5 years. For this term, you need to pay monthly installments. If you miss out on an installment, you might need to pay the balance amount in one go.
Eligibility for Offer in Compromise
You are eligible for Offer in Compromise if:
- If you have diligently filed all your tax returns in the stipulated timeframe
- If your business is not undergoing any bankruptcy proceedings
- If the IRS doubts whether you would be able to pay back the complete amount
The timeline for the IRS to consider your Offer in Compromise can take up to 18 months to either accept or decline your offer.
Conclusion
If you have applied for an Offer in Compromise, then your debt period is suspended till the time the compromise is investigated. If it gets denied, then they have a 10-year stature to settle the debts.
