If you currently owe the IRS tax returns, now is a good time to contact a tax professional to determine if you qualify for the IRS new start program. Recently, the IRS released information relating to their decision to seek assistance from four third-party collection companies to help recover an estimated $138 billion dollar tax debt. What this means for indebted taxpayers is the start of multiple phone calls, harassing letters, and less time to prepare financially for payments due to faster collection enforcement techniques.
The probability of program success is hindered by well-documented incidents of harassment by third-party agencies. Collection agencies are subject to the Fair Debt Collections Practices Act (FDCPA), which protects consumers from abusive debt collection practices. However, collectors often ignore this rule due to pressure to generate a certain level of income and/or earn bonuses in addition to regular payouts. This could prove toxic because of the potential for harassment lawsuits that could cost the IRS millions.
Moreover, this is not the first time the IRS has implemented such a program. According to the New York Times, “Twice previously, in 1996 and 2006, the IRS had attempted to complete some of its collection tasks. Both times, the program was closed and deemed a failure.” However, not before causing significant stress to millions of taxpayers. The most famous were an elderly couple who received more than 150 calls in less than a month.
The IRS currently offers a resolution program that can help taxpayers settle unpaid tax obligations without being exposed to the harsh collection practices of third-party agencies. Ignoring the opportunity to protect yourself and possibly settle your tax issues for less than expected (Offer-In-Compromise), is tantamount to living in a burning house. No sane person would do that… right?
The IRS New Beginning Program provides the opportunity to settle your tax debt in a variety of ways. Depending on your assets, you may be able to create an Installment Agreement (IA) that is conducive to your financial capabilities, or save money by paying a lower amount through an Offer-In-Compromise (OIC). If you choose to research the resolution options mentioned above, make sure you keep the following in mind when choosing your tax professional:
1. Tax professionals must be licensed as Registered Agents, CPAs, or Lawyers.
2. Check with BBB for ratings
3. Check or ask for testimonials from previous clients
Don’t neglect the time given to secure your opportunity to resolve your tax debt problems without any additional unwanted hassles. Contact your tax professional today.