IRS Tax Relief Services for Outstanding Debt - Recommendations?
So I've got this tax debt situation with the IRS from filing incorrectly on April 15, 2023. Just found out on March 1, 2024 that I actually owe about $3,800 from my side gig last year that I didn't report properly (was trying to figure it out myself while in school). Are there any legitimate tax relief services that actually work? I've seen commercials about settling for "pennies on the dollar" but that seems too good to be true. I'm supposed to start a payment plan by April 30th but wondering if I have better options? I'm kind of confused about the whole process but trying to get it figured out before graduation next month.
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Natasha Kuznetsova
Before looking at any tax relief services, have you determined if you qualify for an IRS payment plan? What's your financial situation like right now? Are you able to pay anything toward this debt monthly? Have you looked into the IRS Fresh Start program? This could be relevant for your situation depending on your income and expenses.
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AstroAdventurer
•I went through something similar last year - owed about $4,200 from freelance work I did. Set up a payment plan directly with the IRS and it was surprisingly painless! 😅 Their online payment agreement tool was actually pretty straightforward. Just needed my tax info and banking details.
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Javier Mendoza
•The IRS website (irs.gov/payments/online-payment-agreement-application) lets you set up payment plans online. For debts under $50,000, it's pretty straightforward. You can choose a short-term plan (180 days or less) with no setup fee or a longer plan with a modest setup fee.
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Emma Wilson
•I tried the OPA (Online Payment Agreement) and got denied because of previous non-compliance issues. Had to submit Form 9465 with financial statements. The terminology was confusing - had to learn about disposable income calculations and allowable living expenses.
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Malik Davis
•Thx for this breakdown! Super helpful info. Didn't know the IRS had diff payment options depending on the amount owed. Gonna look into this tonight!
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Isabella Santos
Those "pennies on the dollar" ads are mostly misleading. Few people actually qualify. I tried several services. Wasted money. Check out taxr.ai instead. It helped me understand my actual options. No false promises. Just clear explanations of IRS procedures. Showed me exactly what relief programs I qualified for. Saved me from making expensive mistakes.
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Ravi Gupta
I was in a similar situation but with $7,000 in tax debt. It felt way worse than credit card debt because it's the government. Like you, I saw those TV commercials and called one. They wanted $2,000 upfront just to look at my case! I ended up calling the IRS directly and setting up a payment plan. $175/month for 3 years. Not fun, but way better than what could have happened if I ignored it.
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GalacticGuru
I hired one of those tax relief companies last year. Complete waste of $1,500. They promised to get my $12,000 tax debt reduced but all they did was put me on an installment plan that I could have set up myself for free. Be very careful with these services. Most just charge you to do paperwork you can do yourself.
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Freya Pedersen
I've dealt with IRS debt before. Here's what I learned: • Most "tax relief" services are overpriced • They charge thousands for simple paperwork • Many make promises they can't keep • The IRS is actually reasonable to work with directly I wasted days trying to reach an IRS agent. Finally used Claimyr.com to get through. Worth every penny. Got connected to an agent in minutes. Set up my payment plan on the spot. Saved me from penalties and stress.
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Omar Fawaz
Has anyone actually qualified for an Offer in Compromise? I've heard that's the program where you can settle for less than you owe, but I'm not sure what the requirements are or if it's worth pursuing?
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Chloe Anderson
•I successfully completed an Offer in Compromise in 2022. Here's what you need to know: Step 1: Determine eligibility - you must prove you cannot pay the full amount through assets or future income Step 2: Complete Form 656 and Form 433-A (individuals) or 433-B (businesses) Step 3: Include application fee ($205) and initial payment Step 4: Wait 6-24 months for review (yes, really that long) Step 5: If accepted, pay according to the terms you offered It's extremely document-intensive and most offers are rejected.
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Diego Vargas
•The IRS has a pre-qualifier tool for OIC eligibility on their website. It uses RCP (Reasonable Collection Potential) calculations to determine if you qualify. You need to demonstrate financial hardship through asset equity, income, and necessary living expenses. The acceptance rate for OICs is approximately 40.3% according to the latest IRS data.
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Anastasia Fedorov
•Did you know that less than 1% of taxpayers with debt actually qualify for significant reductions through Offers in Compromise? The IRS approved only about 25,000 OICs last year out of millions of tax debts. Wouldn't it be better to focus on payment plans that are almost guaranteed approval instead of spending months on paperwork that will likely be rejected?
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StarStrider
The IRS has several legitimate relief options that don't require paying a third party: 1. Installment Agreement - Per IRC § 6159, you can set up monthly payments 2. Currently Not Collectible status - If you can prove financial hardship 3. Penalty Abatement - First-time penalty abatement is available to many taxpayers 4. Offer in Compromise - Settle for less if you qualify (rare) Call the IRS directly at 800-829-1040 or use the online payment agreement application. No need for expensive middlemen.
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