Without a basic understanding of tax debt IRS forms, you will have difficulty finding which IRS program you qualify for to resolve your tax debt. Some of the most common IRS debt relief programs are:
Learn your options to settle your tax debt and what the necessary IRS forms for each debt settlement program the IRS offers.
Abatement of Penalties & Interest: IRS Forms 843Anyone who has dealt with a tax debt knows penalties and interest can greatly increase your tax liability, leaving many to wonder how to get some or all of their IRS debt penalties removed. To request an Abatement of Penalties, you will need to use IRS Forms 843. This request will usually only cover one tax year, so if you have more than one year of back taxes, you will need to fill out IRS forms 843 for each year you want the penalties abated. However, there are exceptions to this rule.
It is even harder to request an abatement of interest on a tax liability. To do so, just write "Request for Abatement of Interest Under Section 6404(e)" at the top of IRS Forms 843.
Installment Agreement: IRS Forms 9465Most taxpayers that have a back tax debt will need to set-up a payment agreement with the IRS to properly pay their tax debt in monthly installments. In order to do this, you will need to complete IRS Forms 9465. Keep in mind you will still accrue penalties and interest on your tax debt while paying your tax debt in installments, but for those who do not qualify for any other IRS programs and cannot afford to pay their tax bill in full, this is a great option to resolve your tax debt.
Establishing a payment agreement can be quite simple for smaller debts, but can get complicated for larger debts including business debt. The IRS has more IRS forms for people who owe more than $25,000 in combined tax, penalties, and interest than for those who have less than $25,000 in back tax debt.
Less than $25,000 You will need to fill out IRS Forms 9465 and mail it to the address on your tax bill. Also, the IRS has a convenient Online Payment Agreement Application, which will receive immediate notification of approval.
More than $25,000 The IRS will require a Collection Information Statement IRS Forms 433F, along with IRS Forms 9465. Both forms will have to be mailed and the IRS will send its decision back within weeks.
Please Note: When completing IRS Forms 433F, which details your personal finances including liquid assets, property, income, and monthly bills, you are essentially handing the IRS all the evidence it needs to set up a monthly payment amount based off what it thinks you can afford. Do not submit any financial IRS forms until you consult with a tax debt professional first.
Innocent Spouse: IRS Forms 8857If your spouse filed a joint tax return with omitted or improperly reported items without your knowledge, you could qualify for Innocent Spouse Relief by completing IRS Forms 8857. The IRS has strict guidelines and will reject anyone who doesn't meet all of the program's criteria:
- The joint return had a tax liability understatement because of erroneous items reported by your spouse. Erroneous items include:
- Unreported Income
- Incorrect deduction, credit or basis
- You have a reasonable cause to not know at the time of the filed return about the understatement.
- After investigation, the IRS deems it unfair to hold you responsible for the understatement.
- You or your spouse has not transferred property or assets in an attempt to defraud the IRS.
There are two other spousal relief options, including Relief by Separation of Liability and Equitable Relief for those who do not qualify for Innocent Spouse.
Collection Due Process: IRS Forms 12153You can request a hearing with the IRS Office of Appeals by filling out IRS Forms 12153 to review specific collection actions if you have received the following notices:
- Notice of Federal Tax Lien and Your Right to a Hearing
- Notice of Intent to Levy and Notice of Your Right to a Hearing
- Notice of Levy and Notice of Your Right to a Hearing
- Notice of Levy on Your State Tax Refund
Once you receive any of the above notices, you have 30 days to request a hearing, in which time you will go to tax court if you disagree with the Appeals decision. If you miss the 30 day deadline, you are able to still appeal but you have forfeited your right to a court appearance if you still disagree with the Appeals determination.
When you discover you owe the IRS back taxes, you may feel as if you have no options, but the truth is taxpayers have many different tools to resolve their tax debt. If you were unable to use any of these IRS Forms, visit our Tax Forms page for even more debt relief forms. Fill out the form below or give us call today to discuss in detail the specifics of your tax issue.