Is One-Time Tax Forgiveness A Marketing Gimmick? Our Florida Tax Attorney Explains Actual Ways To Reduce Your Tax Debts

Tax debts are overwhelming and can pose a major threat to your financial security. If you owe money to the Internal Revenue Service (IRS), you may have heard about one-time tax forgiveness programs and wondered if you were eligible.

Unfortunately, there is no actual program that provides a one-time pass in terms of paying tax debts, but the IRS does offer several programs that can help reduce the total amount you owe. Florida tax-IRS attorney Ronald Cutler explains what you need to know about these programs and how to apply.

Programs That Can Help Reduce Tax Debts

According to the latest IRS statistics, Americans owe more than $120 billion in unpaid taxes, interest, and penalties. It is a staggering amount, even spread out over millions of people. Unfortunately, “one-time tax forgiveness” is a marketing gimmick some tax preparation services use to appeal to those who owe money.

What they are actually referring to is likely the First-Time Penalty Abatement program. Penalty abatement involves an administrative waiver that provides relief from certain tax penalties, depending on the circumstances involved. While it does not forgive past due taxes, it can eliminate the excessive penalty charges, provided you have a good tax compliance history.

First-Time Penalty Abatement is one of several available programs that can help if you are dealing with tax debts. These include:

• Currently Not Collectible status, if your financial situation prevents you from paying tax debts without severe economic hardship;
• Innocent Spouse Relief for those who owe money due to errors or fraud on the part of their spouse, which they were unaware of;
• Offer in Compromise (OIC), which may allow you to settle your tax debts for less than the total amount you owe;
• Filing extensions and IRS payment plans, which can help reduce high penalties and interest while allowing you more time to pay.

Applying for Abatement And Other Tax Relief Programs

Tax abatement and other IRS programs can help you regain control of your life and avoid some of the harsh penalties associated with tax debts. While each has its own guidelines and eligibility requirements, the following are basic steps to follow:

• Determine whether you are eligible for tax relief based on financial hardship or other circumstances;
• Gather copies of past returns, income statements, expense reports, and other relevant documents;
• Complete the appropriate IRS form, such as Form 656 for an Offer in Compromise;
• If applicable, submit a written request for First-Time Penalty Abatement, which can help reduce the overall amount you owe.

To Discuss Whether You Are Eligible For Tax Relief, Contact Our Experienced Florida Tax-IRS Attorney

Navigating tax forgiveness programs can be complex, and mistakes may lead to delays or denials. As a certified public accountant and a former FBI special agent investigating tax cases, Ronald Cutler can help determine eligibility, prepare program applications, and negotiate with the IRS on your behalf. Take the first step toward resolving your tax debt. Contact our office and request a consultation with our experienced Florida IRS attorney today.

Sources:

irs.gov/statistics/soi-tax-stats-delinquent-collection-activities-irs-data-book-table-27

irs.gov/payments/administrative-penalty-relief

irs.gov/pub/irs-pdf/f656b.pdf