What is the best way to get rid of tax debt?

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asked Apr 16, 2023 in Law & Legal by Glueonhands (4,510 points)
What is the best way to get rid of tax debt?

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answered Apr 16, 2023 by Ratpleased (2,980 points)
The best way to get rid of tax debt is to contact the IRS and get on an IRS payment plan to allow you more time to pay off your IRS tax debt.

You can also hire a tax relief company to help you get rid of your IRS tax debt or see if you qualify for the IRS tax debt forgiveness program.

There is also a way to get tax debt forgiven through the debt forgiveness program that the IRS offers for taxpayers who meet the qualifications.

To be eligible for for the IRS debt forgiveness program you must claim extreme financial hardship and have also filed all your previous tax returns.

Debt consolidation can affect your tax liability.

Debt settlement will appear on your credit report as such and hurt your credit score.

Also, you may have to pay taxes on the difference between what you paid and what you owed.

Yes, the amount of debt you didn't pay is generally reported to the IRS as income.

When you do a debt settlement, the amount of your debt that's written off is generally reported to the IRS.

And it's generally considered taxable income.

If you do a debt settlement this year, you may end up owing the IRS money next year when you file your next years tax return.

Debt Consolidation can help with Tax Debt.

A Debt Consolidation plan can enable you to pay your tax debt back in fixed monthly installments, rather than all at once.

And depending on the size of your balance, you can stretch out the repayment period up to six years.

To qualify for an IRS Tax Forgiveness Program, you first have to owe the IRS at least $10,000.00 in back taxes.

Then you have to prove to the IRS that you don't have the means to pay back the money in a reasonable amount of time.

Back tax consolidation involves taking out a loan that covers all your outstanding back taxes, paying them off, and then repaying that loan in the form of a single monthly payment.

You can consolidate just about any back taxes with this process, including most tax back taxes owed to the IRS.

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