If you find yourself in trouble with the IRS, don’t panic. There are plenty of options to help you get back on track and settle your tax debt.
Once known as the Fresh Start Program, the Fresh Start Initiative is not a program in itself, but rather a series of changes to current IRS Collection procedures and policies. It’s designed to help both individual taxpayers and small businesses attempting to settle an overdue tax liability.
This agreement gives qualified individuals the ability to pay off their taxes in smaller, more manageable amounts over a period of time, with limited penalties. Additionally, the Fresh Start debt program also includes debt reassessment through Offer in Compromise agreements and tax lien withdrawal.
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How Does The Fresh Start Initiative Work?
The Fresh Start Initiative can be broken down into two tax debt settlement solutions — installment agreements and the Offer in Compromise (OIC) program. These solutions are designed to make it easier for taxpayers to pay off tax debt while limiting financial burden.
Here’s how they work:
Installment Agreements: The taxpayer and the IRS work together to identify a monthly payment plan for the total tax debt owed. This can help reduce tax penalties like tax levies from unpaid taxes, and ultimately, make it more feasible for taxpayers to pay aggressive tax dues.
Offer in Compromise (OIC): An OIC agreement is a settlement solution for individuals who face insurmountable tax debt. This compromise can lessen the amount of taxes owed to the IRS.
Yes, a Fresh Start Initiative settlement can be reassessed even after it has been paid. The IRS requires that you finish your payments for the settlement and continue to file and pay all taxes for five years after completing the terms of your settlement package. If you fail to do so, the IRS will likely pursue the full amount of taxes originally owed.
What Are The IRS Fresh Start Program Requirements?
There are many factors that play into whether you meet IRS Fresh Start tax program qualifications. Some of the most common limitations on the Fresh Start Initiative are:
Self-employed individuals must provide proof of a 25% drop in their net income
Joint filers cannot earn more than $200,000 a year and single filers cannot earn more than $100,000
Your tax balance must be below $50,000 at the end of the year in order to qualify
Not sure if you meet the Fresh Start Program requirements? Get in touch with us today! We’ll assess whether or not you qualify for a fresh start and determine if it’s the right course of action for your situation.
What Changes Have Been Made to the Fresh Start Initiative?
In 2012, the IRS made some changes to the Fresh Start Initiative in order to make it more accessible for struggling taxpayers. This expansion included the following changes:
Raising the installment agreement threshold from $25,000 to $50,000 so long as the debt can be paid within six years.
Increasing the length of installment terms from five to six years.
The program now allows taxpayers to avoid tax liens by using a direct debit installment agreement for balances between $25,000 and $50,000.
How Do I Apply For A Fresh Start With The IRS?
You can apply for a Fresh Start with the IRS directly or with the help of a tax professional. The Fresh Start application can take several months to get approved for if you choose to go it alone. With the help of an Advance Tax Relief expert on your side, we can help expedite the process so you can get your Fresh Start debt resolved as soon as possible.
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If you think that you may need help filing your 2018/2019 tax return or past due tax returns, you may want to partner with a reputable tax relief company that can help you get the max refund and reduce your chances for an IRS AUDIT.
Advance Tax Relief is headquartered in Houston, TX with a branch office in Los Angeles, CA. We help many individuals just like you solve a wide variety of IRS and State tax issues, including penalty waivers, wage garnishments, bank levy, tax audit representation, back tax return preparation, small business form 941 tax issues, the IRS Fresh Start Initiative, Offer In Compromise and much more. Our Top Tax Attorneys, Accountants and Tax Experts are standing by ready to help you resolve or settle your IRS back tax problems.
Advance Tax Relief is rated as one of the best tax relief companies nationwide.