IRS Fresh Start Program Provides Safe Harbor From Your Financial Storms
"Streamlined" or "No Document" Installment Agreements
If you have a tax debt, this is the best time in years to work out a deal. Starting on Feb. 24, 2011, the IRS has rolled out a series of “Fresh Start” programs to help struggling taxpayers. The “Fresh Start” Program is important for small businesses and individual taxpayers. Overview of the Program: (1) “Streamlined” or “No Document” Installment Agreements for taxpayers owing $50,000 or less; (2) Increases limit to qualify from $25K to $50K; (3) Extends payment options from 60 to 72 months. Plan Requirements: (1) Requires Direct Debit payments; (2) Example: You owe $40,000 in back taxes. After you take into account your mortgage, food expense, vehicle expense, and other basic living expenses, you have $2,000 left over each month. The IRS will take a payment plan of $556/mo, no questions asked.
For taxpayers who will make a lump sum payment to resolve their tax liability, the IRS has provided a once-in-a-lifetime opportunity. (1) An “Offer” is based on the sum of the value of your “liquid assets” and your “discretionary income” for a number of months; (2) Offers calculated based on your discretionary income for 12 months, instead of 48; (3) Offers will allow: (a) greater flexibility in expenses the IRS accepts; (b) businesses can exclude “income-producing assets” so they can continue operations; (c) expenses for payment of certain government backed student loans may be counted; (d) taxpayers can keep some of what is in the bank for personal needs; and (e) allows a credit for state tax debts.
GET MORE INFORMATION FROM THE IRS WEBSITE. GO TO:http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Struggling-with-Paying-Your-Taxes%3F–Let-IRS-Help-You-Get-a-Fresh-Start. Struggling with Paying Your Taxes? Let IRS Help You Get a Fresh Start. The Internal Revenue Service’s Fresh Start initiative makes it easier for individual and small business taxpayers to pay back taxes and avoid tax liens. The Fresh Start initiative fundamentally changes IRS Collection practices in the following areas:
• Fresh Start Notice of Federal Tax Liens
• Fresh Start Installment Payment Agreements
• Fresh Start Offer in Compromise
• Fresh Start Penalty Relief