Tax Filing And Compounding Problems: How To Manage This Year’s Taxes With Last Year’s Lien

Taxes are weighing you down. While you can agree that everyone should pay taxes, yourself included, it is not always possible despite the fact that you had money all year. Whatever the cause or reason, it is understandable that you would want to avoid filing your income taxes this year when you already stare a tax lien in the face on last year's taxes. Here are some tips on how you can manage this financial matter, and eventually come out of it even.

Continue to Work Through the Tax Lien

Find a way to reduce the amount the government will allow you to pay. The IRS is actually pretty flexible when it comes to these issues. They are also quite fair, so long as you were not trying to evade them for ten years or more. If this is your first ever tax lien, call them. Talk to someone in their office and let them know that you cannot pay as much as they demand. Request some sort of payment plan that you know you can manage. Present them with an initial payment over the phone, as a sign of good faith. Continue paying on the lien faithfully.

File This Year's Taxes on the Very Last Possible Day

The good news is, now that you can file your taxes online and have them accepted almost immediately, you can file this year's taxes on the very last possible day. This gives you a lot of wiggle room to deal with last year's taxes before the IRS starts demanding payments on this year's taxes. You can get at least an extra month before they start sending you payment notices for this year's taxes.

Consolidate

See if there is a way you can consolidate the taxes from this year and last year. When the IRS is informed (by you) that you owe for a previous year and the current year, they can consolidate the debt into one instead of two debts so that you only have to make one payment each month. If the required payment on the consolidated debt is too high for you, request a lower payment. As long as the IRS is getting paid each month, they tend to drop any other legal action.

When All Else Fails, Hire a Lawyer

When all else fails, hire a lawyer. The lawyer can make formal requests to the IRS to drop the interest accrued or penalty charges, along with a lower monthly amount than you could have negotiated. You should not have to juggle double the debt to the same debt holder.


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