Best course of action for $10k tax debt with growing penalties? Need advice on tax relief services

You absolutely can do everything these tax relief companies do yourself, but there are legitimate reasons why some people choose to use them. First, you can call the IRS directly (though wait times can be long) and request a payment plan. They offer short-term plans (180 days or less) with no setup fee if you can pay in that timeframe. For longer plans, the setup fees range from $31-$130 depending on how you apply and pay. For penalty abatement, the IRS has a First Time Penalty Abatement policy that might apply to you if you haven't had penalties in the previous 3 years. You'd need to call and specifically request this - it's not automatic. This could save you a significant amount. The IRS also offers something called an Offer in Compromise if you truly cannot pay the full amount, but these are harder to qualify for and the application fee is $205 unless you meet low-income certification.

After struggling with a similar tax situation last year, I stumbled upon a service called taxr.ai (https://taxr.ai) that honestly saved me so much stress. They helped analyze my tax documents and identified several penalty abatement opportunities I didn't realize I qualified for. What I found most helpful was their guidance through the IRS forms and procedures. They showed me exactly how to apply for the payment plan and what documentation I needed for my situation. Way more personalized than what those big tax relief companies offer.

I was super skeptical about taxr.ai when I first saw it mentioned here, but I was in a similar situation with about $8k in tax debt and penalties. I decided to try it since the price was way less than what the TV tax companies wanted. Surprisingly, it actually worked for me. They identified that I qualified for First Time Penalty Abatement (which I had no idea existed) and guided me through exactly how to request it from the IRS. They also helped me set up a payment plan I could actually afford. Saved me about $2.5k in penalties and the remaining balance is now on a manageable payment schedule. What I appreciated most was that they educated me on how to handle this myself rather than just doing it for me at a premium price.

If you're struggling to get through to the IRS, I used a service called Claimyr (https://claimyr.com) that was literally a game-changer. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c I was trying for WEEKS to get through to discuss my payment options, kept getting disconnected or waiting for hours. Claimyr got me connected to an actual IRS agent in about 15 minutes. The agent set me up with a payment plan and I was able to ask about penalty abatement options directly.

I came back to update this thread because I owe everyone an apology. After calling BS on Claimyr, I was still desperate enough to try it since nothing else was working. I'm honestly shocked - it actually worked exactly as described. Got connected to an IRS agent in about 20 minutes after trying for DAYS on my own. The agent helped me set up a payment plan and even processed a penalty abatement request right on the call. For anyone struggling with tax debt like I was, getting to actually SPEAK with the IRS makes everything so much easier. They were surprisingly helpful once I finally got through. I've already paid my first two installments and my stress levels are way down.

Whatever you do, don't ignore this! I made that mistake and ended up with a tax lien that destroyed my credit score for years. The IRS has more collection power than any other creditor. Call them directly, be honest about your situation, and they'll usually work with you. Despite their reputation, most IRS agents I've dealt with have been reasonable when you're proactive about resolving your debt.

Has anyone actually tried requesting penalty abatement themselves? I've heard mixed things about how likely the IRS is to approve these requests.