Filing Your Taxes When You Know You'll Owe Money to The IRS
Filing Your Taxes When You Know You'll Owe Money
to The IRS
As we being the new year, most people are thinking about their taxes. Planning ahead can have a serious impact on your tax bill next year, especially if you know you’ll owe taxes. In this article, we’ll talk about some steps you must take if you know you’ll be owing taxes to the IRS or state.
Note: If you already
have tax troubles or owe more than $10k to the IRS or state but can’t pay in
full, contact our firm today. We help people find tax relief, file years of
unfiled tax returns, and sometimes settle their tax debt for a fraction of
what’s owed. Return to the main page of www.fairtaxsolutions.com to learn more.
Report
All Your Income
One of the biggest reasons people get in
trouble with the IRS is their failure to report income. Oftentimes it’s an
honest mistake and they simply forget about income they’ve made throughout the
year.
-Did you take on a consulting gig? Your
client might have filed a 1099 reporting your income.
-Did your savings and investments earn
interest? You’ll likely need to report that income as well.
The stock market has been on a wild ride,
and breaking records despite COVID-19. If you sold stock and cashed on on the
gains, these gains are reported to the IRS and it means that a lot of Americans
might get an unexpected tax bill.
As the year wraps up, it’s wise to take
inventory of where your income came from this year so you can stay on top of
any tax forms you might get outside of your normal W2.
Run
The Numbers Ahead of Time
Some people like surprises but when it
comes to taxes, it’s best to avoid them.
You do not have to wait for tax filing
season to estimate how much you might owe. Be proactive about consulting with
your tax advisor, or us, and estimate your tax liability based on how you did for the
year.
They’ll be able to suggest tax strategies
before the year ends that can save you thousands of dollars on your tax bill. If you don't already have a tax advisor or CPA, we can help!
Set
Money Aside to Pay Your Taxes.
Taxes are inevitable. If you know for
certain you’ll owe money to the IRS but don’t have the money to pay all of it
up front, it’s best to set at least some money aside early so you can pay as
much of your tax bill upfront as possible.
The IRS can be more lenient if they see
you’re trying to honor your responsibilities and settle your tax debt.
Learn
About Tax Relief Options
The IRS has the authority to levy your
bank account, garnish your paycheck and seize your assets if it has to, but
they also have many tax relief options to help taxpayers in need.
Things like settling your tax debt for a
fraction of what you owe, installment plans, penalty abatements, and more, can
all be viable tax relief options depending on your situation.
If you owe money to the IRS and can’t
afford to pay, you have options. It’s best to reach out to a tax relief firm
like ours to learn more about them. Call us at (470) 305-1233 for more information about us.
Don’t
talk to the IRS, talk to us first.
If you do get hit with a surprise tax
bill and lack the money to pay it, you need to settle your tax problem as soon
as possible. The IRS wants their money, and they have unbridled authority to
get it, so simply avoiding the tax bill will not make it go away, but make it
worse. A lot worse.
However, dealing with the IRS is often
intimidating for most taxpayers. Talking to the IRS and trying to resolve your
own tax problem is like going to court without a lawyer, you’ll most likely get
crushed.
A tax resolution firm like ours has years
of experience helping taxpayers just like you resolve IRS and State tax
problems and negotiating the best deal on your behalf. If you owe the IRS money
either for 2019 or prior years, contact us now for a consultation to learn
about your options, at chloe@fairtaxsolutions.com or (470) 305-1233.
The good news is the IRS has several debt
settlement options including their Fresh Start Initiative and is generally willing to settle with
taxpayers who have been blindsided by a surprise tax bill and can’t pay it off
in full.
Hopefully, tax filing season will bring
the big fat refund you are expecting, but it is important to be prepared for
the unexpected. The new tax bill has unleashed a host of unintended
consequences, including smaller refunds and surprise tax bills. By being
prepared, you can reduce the pain of a surprise tax bill, so you can get on
with the rest of your life.
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