The Most Important Information to Give the IRS to Settle Your IRS Tax Debts
If you Owe Back Taxes, if you are suffering from an Economic Hardship and if can’t pay your Monthly Living Expenses, you May be in Luck!☘️
When you owe back taxes to the IRS, May suddenly become very interested in your monthly income and expenses!
In fact you may want the IRS to know about your personal financial situation!
You may want to share your monthly expenses, such as your;
• Housing costs
• Car payment, gas, and insurance
• Gas, water, electric and other utility bills
• Medical insurance
• Cell phone
• Groceries and dining out
…and much more.
Why would you share this information with the IRS?
It all comes down to what the IRS calls Allowable Living Expenses.
The second you become a tax debtor, the IRS has a Secret tax lien against everything you own, including your future income. This is a feature of federal law, and it’s the basis for all the other collection actions that the IRS can take against you, such as a Wage Garnishment or Bank Levy.
Because of the lien, the IRS legally has a say in how you spend your money. Nobody likes this, but it’s the reality of how the US tax code works.
As with most laws, there is a long and complicated list of rules that go into determining what place the IRS holds in line behind or ahead of your other creditors, but the bottom line is that the IRS wants to get paid, and they have power to make your life a living nightmare by enforcing the tax laws over your money and assets.
It’s not all bad, however. There are specific legal protections that exist to prevent the IRS from taking everything you own. In simple terms, the IRS is not allowed to make you destitute. In other words, they are not allowed to put your family out on the street or force your children to starve if it creates an Financial Hardship on you and your family.
This is where those Allowable Living Expenses (ALE) come in. The IRS must allow you to pay all your basic living expenses, even if it means you cannot pay the IRS what you owe them. Sounds Great! Mostly, other than the tax lien they may file.
The IRS has legal standards that is required to follow and allow you and your family to pay before the IRS can collect anything. These are the usual categories:
• Food, clothing, personal care products, and “miscellaneous”
• Out of pocket health care costs
• Vehicle ownership and operating costs
• Rent or mortgage
• Utilities, including gas, water, electric, cell phone, Internet, and more
For vehicle operating costs, housing, and utilities, they do take into account regional variations for these costs. The rest are all based on national numbers. All the numbers also have adjustments based on family size.
These numbers “dictate” what the IRS will allow you to spend every month to live. Your income, when compared to these allowable standards, is what determines which IRS tax relief options you may be eligible for.
If your income is less than the total monthly allowable living expenses for Honolulu or where you live and family size, you might be eligible for a program that allows you to pay the IRS nothing. Yes, nothing. Zero. Nada. Zilch.
If your income is also less than the total monthly allowable living expenses, the IRS calculate for you, but you have assets – such as lots of equity in your home, stocks, bonds, classic cars, crypto, or the world’s most valuable Vinyl Record collection – then they’re going to take into consideration the value of those assets, too. But, in such a situation, you may be able to settle your tax debt for less than what you owe, and walk away from the rest.
If your income is more than the allowable living expense calculation, then the IRS is going to take that “excess” income into consideration for a reduced settlement. If you’re not eligible for a reduced settlement – which most people are not – then this “excess” income becomes the monthly minimal payment the IRS can require as a monthly payment.
One of the first things that Tax Relief Services can help our clients when they hire us to help them with a tax debt problem is to conduct a detailed Preliminary Analysis the exact same detailed financial analysis that the IRS should do but most of the time will not. We do the Preliminary Analysis for a number of reasons, such as:
1. Determining which IRS programs you’re eligible for.
2. Seek opportunities to legally increase your allowable living expenses.
3. Determine if the IRS balances are correct.
4. Look for unique circumstances that might open doors to outside-the-box resolution options.
This preliminary financial analysis is crucial for us to be able to get the best possible deal for our clients. Since the vast majority of tax debtors will end up on a monthly payment plan to the IRS, our job is to help get you the smallest possible monthly payment and help you minimize the short-term financial impact on your budget.
The IRS is NOT LOOKING OUR FOR YOU, BUT TAX RELIEF SERVICES IS!
If you’re in a situation where the IRS is hounding your, then we should chat. You don’t want to wind up in a situation where the IRS simply pigeon-holes you into the situation that is most convenient for them, leaving you unable to pay other monthly bills. Just schedule a time to chat:
WWW.TAXRELIEFSERVICES.COM
CALL TODAY!
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808.589.232
