The Internal Revenue Service, the US nation’s tax collecting agency, enforces the Internal Revenue Code, which Congress adopted. Moreover, the IRS Strategic Plan is a road plan to guide IRS operations and meet the evolving requirements and expectations of our nation’s taxpayers and the tax professionals who assist them.
The main goal of the IRS is to investigate illegal activities. To elaborate, criminal investigation supports the broader IRS Mission by investigating suspected criminal breaches of the Internal Revenue Code and associated financial crimes in a way that builds trust in the tax system and compliance with the law. Compliance with the law is vital to the IRS, and one-time tax offenders are usually treated very respectfully with the many debt repayment solutions the IRS offers.
What the IRS does and how it’s changing
The IRS’s resources have been reduced in recent years, while the agency’s workload has expanded. The IRS must process more returns, oversee more deposits and refunds, and devote more resources to keep people compliant as the taxpayer population grows. Economic and societal changes have produced new obstacles to tax enforcement and compliance. These include globalization of business activity, growth in the percentage of income taxed through partnerships and other pass-through companies, and changes in family structure. The later modifications have made it more difficult for the IRS to establish whether individuals are eligible for tax advantages based on complicated factors such as household living arrangements, family ties, and support tests.
The IRS’s expanding responsibility in managing social programs has contributed significantly to the rising burden. The IRS now oversees a variety of benefits for low- and middle-income families, with tax breaks for higher education and premium subsidies under the Affordable Care Act.
The IRS and their solution for financial hardship
The IRS implemented a ‘Fresh Start Program’ to help relieve debt repayment stress for individual taxpayers. The IRS may concede that you are experiencing financial hardship (economic hardship) if you can demonstrate that you cannot or barely can pay your basic living expenses. To decide if you are in a hardship position, the IRS will utilize its collection financial guidelines to calculate permitted basic living costs. In short, The Fresh Start Program requires the IRS not to seize more than a person can pay. This assists the taxpayer in reaching an arrangement with the IRS and allows them to pay a sum they can moderately afford. The IRS’ key criterion for review is the taxpayer’s financial status.
Although the many names may cause some people to become confused, the IRS Fresh Start Initiative is equal to the Fresh Start Program or the Fresh Start Tax Relief Program. The program was founded by the federal government, but the IRS is required to make it available to qualified American citizens with existing tax liability. This is why it is known as the IRS Fresh Start Program. Before approval, the taxpayer may be required to fill out a form on the IRS website, phone or email an IRS person, or arrange an appointment to visit their local IRS office to confirm eligibility. The IRS receives and processes their application once they submit them.
Here’s why getting zero back from the IRS might be a good thing
Reaching zero with the IRS implies you’re neither owing nor receiving a refund. It shows that you paid the total amount of your tax due. People mostly regard not receiving a return as a failure, but it is further from the truth. You’re paying the appropriate taxes if you can avoid owing money or receiving money back. Furthermore, you’ll have cash in your hands to accomplish whatever you want. If you neither got a refund nor had a balance of $0 and have serious problems repaying your debt to the IRS. We strongly urge you to contact the IRS or one of our tax professionals immediately to negotiate the best possible outcome for your situation.
What about tax debt in retirement?
The IRS also considers lifetime tables, among many other things, when considering your tax debt situation. The agency considers average life expectancy and relatively low living costs. However, the IRS legally must verify that they are not inflicting financial hardship on the debtor. If your retirement account can sustain more than those essentials, the IRS can seize the excess, but the requirements and rules are rather stringent. Extenuating facts about your finances and any other retirement accounts, such as your assets, obligations, income, and spending, will also be evaluated by the agency. Contact one of the Ideal Taxes trained tax specialists to obtain the best potential solution for your circumstance.
