What are Back Taxes?
Do you have tax debt? Are you feeling overwhelmed and stressed out? You’re not alone. Millions of Americans find themselves in the same situation every year.
In this article, we will discuss what back taxes are, why they happen, and what you can do about them. We will also provide a few tips on how to get tax debt relief.
Back taxes, also known as unpaid tax liabilities, are taxes that you owe to the government. This can happen for a variety of reasons.
The most common reason is that people do not have enough money to pay their tax bills when it’s due. This can be due to a difficult year financially or because they under-withheld from their paychecks throughout the year.
Another reason for back taxes is that people make mistakes on their tax returns and are missing pertinent information. Whatever the reason may be, if taxes are not paid, you will end up being in debt to the IRS.
Possible Resolutions
If you find yourself in a situation where you owe back taxes, don’t panic. There are a few different things you can do to resolve the issue.
The first thing you should do is contact the IRS and explain your situation. They may be willing to work with you to set up a payment plan so that you can pay off your tax debt over time.
If you can’t afford to pay your tax debt, you may be able to qualify for an offer in compromise. This is where the IRS agrees to settle your tax debt for less than what you owe.
You may also be able to file for bankruptcy. This will discharge most of your debts, including your tax debt. However, it should be a last resort as it will have a negative impact on your credit score.
Penalties
If you don’t pay your back taxes, the IRS will start to impose penalties. The first penalty is called the failure-to-pay penalty. This is a 0.
The second penalty is the failure-to-file penalty. This is a much larger penalty, and it’s imposed if you don’t file your tax return by the due date. The failure-to-file penalty is usually five percent of your tax bill for each month or part of a month that you don’t file.
Looking for Tax Debt Relief? Contact the Highly Reputable Anderson Bradshaw Tax Today
If you are struggling with tax debt, the professional tax consultants at Anderson Bradshaw can help you through your unique tax situation. With over 30 years of experience in the industry, we have seen almost every tax issues and have learned the best ways to handle each one accordingly. You can feel confident knowing your struggles and difficulties with the IRS can be resolved and corrected quickly and efficiently at Anderson Bradshaw Tax Consulting. For further information or to schedule a consultation please contact Anderson Bradshaw Tax Professionals at 877.550.3911 or visit www.AndersonBradshawTax.com to learn more.
