Tax Debt Relief

Dealing with Tax Debt? You’re Not Alone—Here’s What You Can Do

Let’s be honest—life doesn’t come with many guarantees. We’ve all seen how unpredictable things can be, like when the weather forecast promises sunshine and you still get caught in the rain. But as Benjamin Franklin once wisely said, “...in this world nothing can be said to be certain, except death and taxes.”

And while we might chuckle at that quote, there’s nothing funny about getting a letter from the IRS saying you owe back taxes. It’s the kind of mail that can make your stomach drop—unless, of course, you thought you owed $10,000 and the IRS tells you it’s only $100. (Now that would be a pleasant surprise!)

But what if it’s the other way around, and the IRS says you owe $10,000 when you were expecting just a $100 bill? It’s enough to leave anyone feeling overwhelmed and unsure of what to do next.

Take a breath—you have options. The IRS actually offers several programs to help people manage their tax debt. Let’s walk through them so you can get a sense of which one might be right for you:

1. Extension of Time to Pay

If paying your full tax bill right away would create what the IRS calls an “undue hardship,” you can apply for an extension of up to 6 months. This might apply, for instance, if you’re between jobs or just finished school and expect your financial situation to improve soon. Just keep in mind—interest still accrues during this time, and penalties will kick in if the debt isn’t paid by the extended due date.

2. Short-Term Payment Plan

The IRS offers a short-term payment plan for those who can pay the full amount within 6 months but just need a bit more time. You’ll still accrue interest and penalties during the payment period but spreading payments out over a few months can make things more manageable.

3. Installment Agreement

If your debt is too large to pay off quickly, you may qualify for a longer-term installment agreement. This allows you to pay monthly over several years (up to 72 months). There is a setup fee, but many find this to be a helpful and realistic way to pay down what they owe over time.

4. Offer in Compromise

In certain cases, the IRS may agree to settle your tax debt for less than the full amount owed. This is called an Offer in Compromise. It’s generally available to those with significant debt and limited ability to pay. If approved, it can be a fresh start—especially when paying the full amount would be unrealistic within your lifetime.

You Don’t Have to Navigate This Alone

Finding the right solution depends on your personal situation—there’s no one-size-fits-all answer. But the good news is that you don’t have to figure it all out by yourself. Our team of experienced tax professionals is here to help. Just clink the link to schedule time to speak with an expert from Lisa Brugman, EA & Associates.

So, if tax debt has you feeling stressed, reach out. We’ll help you find the relief you need—and maybe even turn this tough situation into a manageable one.