If you cannot afford your IRS payment plan you may be able to fix it by…
- Entering a new IRS payment plan
- Putting your case into Currently Not Collectible status
- Filing an Offer In Compromise
- Filing a bankruptcy
New IRS payment plan
Since you already have been paying in on the debt, you may be able to lower your payment per month and stretch it out for a longer period of time.
You might also qualify for a lower payment plan based on your financial information, but this often results in a tax lien being filed.
Currently Not Collectible status
Equivalent to a payment plan for $0 per month. You will need to provide financial information to the IRS in order to get this approved.
You need to prove that you cannot afford to pay based on your financial information.
The IRS takes some figures based on the county you live in and some based on your actual expenses.
When you file a bankruptcy, you will not be required to make payments on your tax payment plan.
Not all tax debts qualify for bankruptcy so check with your bankruptcy attorney to see what qualifies. Often if your main debt is just taxes, you are better off getting an Offer In Compromise instead.
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