The IRS is responsible for assessing and collecting all due federal income tax. The body has the absolute authority and the Congress has given it power to carry out its functions in a proper manner. The powers and resources vested in it make the IRS the world’s most powerful and largest collection agency today.
The powers of the IRS are muted by a degree as it is not allowed to harass the citizens or create unnecessary and unreasonable financial hardship in the course of the collection process. The framework of its powers and functions is very clearly defined by the Congress. These norms ensure that the tax payer is also given assistance in the calculation and recovery of back tax issues.
What is IRS Installment agreement?
The IRS payment plan or the installment agreement is a powerful tool to discharge your tax debt. The IRS is vested with the powers to draw up a monthly payment plan in accordance with the paying capacity of the tax payer. The plan is based on the total tax liability of the defaulter and the resources available to him. A disclosure of the defaulter’s financials is mandatory.
The conditions that are stringently applied relates to the fact that the tax payer is liable to pay the future taxes and pay them in good time. In the situation that the tax payer is not viable for an offer in compromise the court may order the person to agree to an installment agreement. It is a good situation if the amount to be paid is less than $25000, as the process becomes simpler and more readily accepted by the IRS. The IRS will enter into an installment agreement when the taxpayer has successfully filed all of the federal income tax returns. The IRS may then file a Notice of Federal Tax Lien in order to protect its interest until the total tax liability is paid fully.
Dealing successfully with the IRS can be challenging for the individual taxpayer. It is often in the tax payer’s interest to get the help of a CPA or experienced tax lawyer to facilitate the best possible solution to their tax problems. So, if you are reeling under pressure and would like to get respite from your tax related woes, it is a good idea to get in touch with an IRS professional at the earliest.