IRS Hardship: IRS Hardship Status Explained, Get the Relief with IRS Back Taxes!
IRS Hardship? Use IRS Hardship Status to relief your IRS Back Taxes problems.
Flat Broke: Many people are in an IRS Hardship- they simply cannot afford to pay their IRS Back Taxes. If you can't afford to pay IRS Back Taxes due to an IRS Hardship situation, you may qualify for IRS Hardship Status! When you're in an IRS Hardship, IRS Hardship Status gives you a reprieve from paying your IRS Back Taxes until you can get back on your feet. Keep reading to see if you qualify for IRS Hardship Status.
IRS Hardship Status: IRS Hardship Status is for people who cannot pay on their IRS Back Taxes without sacrificing their basic needs. The IRS will compare your monthly gross income versus what they consider your "allowable expenses" to determine if you qualify for IRS Hardship Status. If you qualify for the IRS Hardship program, collection efforts on your IRS Back Taxes may be extended for up to 1 year.
Basic Needs? Basic needs or "allowable expenses" for IRS Hardship Status include food, housing, clothing, transportation, medical expenses, and insurance. The IRS will not count any luxury expenses as basic needs. So don't try to include the price for weekly lawn maintenance (The IRS wants you to mow your own lawn), or even the price of private school for your kids. The amount of money you can spend on your basic needs are national standards, which the IRS updates every year. Here as the national standards as of March 1, 2008:
Basic Needs Applying to One Person:
Housekeeping Supplies: $28
Apparel & services: $85
Personal care products & services: $30
As you can see, the IRS is not very generous with what they consider "allowable expenses."
Qualify? If paying the IRS will make you go without basic needs, you may qualify for Hardship Status. How do you apply for it? First, you fill out Form 433A. The IRS will use this form to figure out your financial situation and see if you qualify to have IRS Back Taxes suspended.
Remove IRS Back Taxes: It's not over yet. The IRS Hardship Plan does not suspend collections forever. After the grace period given to you has expired, collections efforts will resume full force. Additionally, the IRS will check up on your every couple of months during the IRS Hardship period. If your income has changed, the IRS might expect you to pay on your IRS Back Taxes.
IRS Hardship Criminal Charges: Do not lie on Form 433A in any way to achieve Hardship status. When the IRS finds out, you'll face severe penalties and/or criminal charges. If you are unsure about anything you put on your form, contact a professional that will help you. Don't go to jail just to skip out on your debt for a few months!