Many businesses get into IRS tax debt because of payroll taxes. Using this money for other debts or to keep your business running can lead to tax penalties, interest, or eventually IRS collection actions.
Get Into Tax Compliance
If you have payroll tax debt, your first step should be to get into tax compliance. This requires filing any delinquent payroll tax returns.
You should also find a way to pay your current payroll taxes. The IRS will not be pleased if you work out a deal to pay off your old payroll taxes, but continue to let your current payroll taxes go unpaid.
Once you’ve got these issues under control, you can work on resolving your payroll tax debt.
Installment Agreements
Installment agreements are an option if you can afford monthly payments. Don’t agree to a monthly payment plan that you can’t afford, or you’ll find yourself back in the same situation if you default on your agreement.
It’s possible to get the IRS to agree to longer repayment periods or lower monthly payments, but it may require some negotiating. A tax attorney can help you get a payment plan that fits your budget and other circumstances.
Offer in Compromise
Businesses can use the Offer in Compromise (OIC) program. This option is only available if you can’t afford to make monthly payments.
Your offer will need to be at least as much as the minimum offer amount as determined by the IRS. Don’t waste your time submitting an OIC if you aren’t eligible—talk to a tax attorney to see if you qualify first.
Currently Not Collectible Status
Currently Not Collectible (CNC) status offers temporary relief from enforced collection actions. Your tax debt will continue to accumulate penalties and interest, but the IRS won’t levy your assets while you are in CNC status.
CNC status is a good option to get temporary relief from an impending bank account levy or asset seizure, but it doesn’t do anything to resolve your tax debt.
Consult a Tax Resolution Attorney
You may also qualify for other tax resolution options, such as penalty relief. Contact a tax attorney to avoid IRS levies and resolve your payroll tax problems.
Get help with payroll tax relief by calling The Gartzman Law Firm at (770) 939-7710. We can listen to your concerns and help you find the best tax resolution strategy for your case.