727·330·3500    ·    Denise Mensa-Cohen, Enrolled Agent    ·    Office Located in Clearwater, Florida
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IRS Fresh Start Initiative

for Taxpayers who Owe Money

While most taxpayers get a tax refund when they file their taxes, some will owe the government money. 

Given the climate of our economy the past several years, the IRS has expanded its “Fresh Start Initiative” for struggling taxpayers.

If you are worried about being able to make your payment all at once, you may be eligible for relief programs.

You can see where Fresh Start Initiative can help you
by clicking on the boxes below to expand the text:

First Time Abatement Policy

The IRS’s First Time Abatement Policy may offer relief for first time penalty charges.

This is a one-time consideration and is also based on the taxpayer’s compliance history.

Generally, the First Time Abatement is available for failure to file, failure to pay, and failure to deposit penalties but only applies to a single tax year.

If the taxpayer is requesting relief for two or more tax periods, the First Time Abatement would be applied to the earliest period if it meets all criteria.

The First Time Abatement does not apply if the taxpayer has not filed all returns and paid, or arranged to pay, all tax currently due.

Installment Agreements   (Monthly Payment Plans)

The Fresh Start program expands taxpayers’ access to installment agreements.

Now, individual taxpayers who owe up to $50,000 can pay through monthly payments. The taxpayer may be required to provide the IRS with financial information.
 Taxpayers in need of installment agreements for tax debts more than $50,000 will need to provide the IRS with a financial statement. The IRS may ask for you to provide a Collection Information Statement.
 Taxpayers who are permitted to utilize an Installment Agreement for repayment must keep their account in good standing during the full term of the agreement.


Offers In Compromise   (Settle for Pennies on the Dollar)

Fresh Start expansion gave the IRS more flexibility when analyzing a taxpayer’s ability to pay, thus, making the program available to a larger group of taxpayers.

Generally, the IRS will accept an offer if it represents the most the agency can expect to collect within a reasonable period of time. The IRS will not accept an offer if it believes that the taxpayer can pay the amount owed in full as a lump sum or through a payment agreement.

The IRS looks at several factors:

  1. Ability to pay
  2. Income
  3. Expenses
  4. Asset equity

A taxpayer must be current with all filing and payment requirements and must not have an open bankruptcy proceeding to be eligible for the OIC program.

There may be light at the end of the tunnel if you feel your tax debt is overwhelming.  The most important thing to is to be proactive in finding a solution to assist you in paying your tax debt and NEVER ignore letters from the IRS.

Contact the Enrolled Agents at Mensa Tax Experts to see how you will benefit with our representation to the IRS.

Contact TaxGenuity Tax Experts

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