Taxes are a regular and expected part of the year for everyone, including healthcare workers. However, for those healthcare workers that get behind on taxes, they can be very stressed and worrisome.
Unpaid taxes add up; tax debt, penalties, and interest grow, creating an overwhelming situation for taxpayers. As a healthcare worker, you’re already in a high-stress career. Tacking on the tax debt, fees, and legal troubles can be debilitating.
If you are a healthcare worker with back taxes, it’s important to understand the tax relief options available to you. When you can see a viable resolution to your situation, you’ll be able to breathe easy and focus on your life, family, and work.
Take a look at the options available for tax relief for healthcare workers:
IRS Payment Plans
Healthcare workers who have an unpaid tax bill may find relief from their growing debt with an IRS payment plan. The payment plan is a practical way to pay back taxes as well as penalties and interest that have accrued.
With this option, you will enter into an agreement with the internal revenue service. This agreement states that you will pay a set amount of money each month for a specific length of time until your tax debt is paid off.
Healthcare workers have two types of payment plan options. There is a short-term plan and a long-term plan. The short-term payment plans are for those with a maximum of $100,000 in tax debt, penalties, and interest. They last for a maximum of 120 days. The long-term payment plans are for those with a maximum of $50,000 in tax debt, penalties, and interest. They last for over 120 days.
When you are approved for a payment plan, penalties and interest are not removed. In fact, they can continue to accrue until your tax debt is paid in full.
Offers in Compromise
The offer-in-compromise is another tax relief program offered by the IRS. With this program, taxpayers who cannot pay their back taxes without creating financial difficulties for themselves can settle their debt for less than they owe.
While this can be a beneficial program for many first responders who do not have the means to pay their tax debt, it is a hard program to qualify for. The IRS only approves less than half of those who apply for the offer-in-compromise program. Due to the cost of applying, you may want to consider a different option or talk to a tax relief professional to discover whether or not you are likely to qualify.
If you choose to apply, the IRS will take a look at your income and expenses, your ability to pay your tax debt, and any assets you may have. When applying, you will need to pay a fee of $205 and make an initial payment, both of which are non-refundable. Low-income applicants may be able to have the application fee waived. To qualify, you must not be behind in filing your tax return or be undergoing bankruptcy.
Currently Not Collectible
Essential workers that have back taxes may be able to find tax relief by obtaining currently not collectible status. Taxpayers with extreme financial hardships that prevent them from paying their taxes could be eligible for the program. In order to qualify for currently not collectible, you must be able to show the IRS that you cannot pay for your living expenses if you pay your tax debt. If approved, collections attempts will stop during the time that you remain in currently not collectible status.
When you apply, you will need to complete a Collection Information Statement. Here you will prove your income and expenses, in order to show that paying your debt will prevent you from paying for your living expenses. Those who are approved have only a temporary reprieve from their taxes. The IRS may review your case annually to determine if you still qualify for the program.
Hire a Tax Relief Company
Tax relief programs such as payment plans, offer in compromise, and currently not collectible, can be applied for without assistance. However, many people are overwhelmed by back taxes and dealing with the IRS. They find that hiring a tax relief company for advice and assistance relieves the stress and worry of negotiating with tax agencies.
A professional tax relief company understands the tax relief process. They will be able to help you determine the best program for your situation and accurately submit forms and information when you apply. A company with tax attorneys, CPAs, and enrolled agents will be able to negotiate with the IRS on your behalf.
Be careful because there are many scam companies out there offering tax relief. These companies charge high upfront fees and often are not able to represent their clients in front of the IRS. They claim to be able to help people find tax resolutions through unlikely programs and IRS negotiation, however, they are not qualified to do so. Scam companies will take their clients’ money without providing results.
When you are looking for a tax relief company, you need to ensure that you find a qualified company with licensed professionals that can represent you. Make sure that you hire a reputable tax relief company with positive customer reviews and multiple satisfied clients.
The IRS Tax Relief Network is an experienced company with experts who can provide effective tax relief services. Their team is able to deal with the IRS to ensure that you get the tax resolution you need. The professionals from the IRS Tax Relief Network are experts in tax law and helping healthcare workers find tax relief.
