bank rates credit cards insurance finance calculators

You know things are bad when…

…The IRS starts taking pity on us.

You almost have to cringe when IRS Commissioner Doug Shulman says: “The IRS will do everything it can to help during these tough times.”

But the Internal Revenue Service says it will be more lenient with taxpayers who are struggling to make their payments.

The new policies apply to those with older delinquent tax bills as well as people who may be struggling to pay their 2008 taxes due to job loss, illness or other hardship.

If you call the IRS with a problem, employees have more leeway to:

Postpone or suspend collection actions on delinquent accounts. If you’ve recently lost your job, had a serious illness or have only a low fixed income, such as Social Security, you may get a reprieve that will halt those nerve-wracking collection calls.

Give you more time to make up missed payments. The IRS usually cancels installment agreements if a taxpayer misses a payment. Under the more lenient rules, agents can reduce your monthly amount or forgive a skipped payment right over the phone. The same goes for those struggling to make payments on an Offer in Compromise agreement, where the IRS has previously agreed to forgive part of a delinquent bill.

Review the value of your home. Some people couldn’t negotiate a reduced payment plan because they had too much home equity. Given the dive in real estate values, the IRS will reconsider whether your home value really is enough to prevent you from getting a compromise deal.

Stop seizing your money. The government will refrain from garnishing your paycheck or bank accounts if you can prove financial hardship. When you call the IRS to ask for a reprieve, be sure to have your bank or employer’s tax identification number and any levy paperwork you’ve received.

Comments (1)
1 Star2 Stars3 Stars4 Stars5 Stars (5 votes, average: 3.20 out of 5)
One Existing Comment
  1. ccnyc said:
    on March 30th at 06:42 pm

    Do Not believe this!!!!!!!!! PAY YOUR TAXES. The IRS and NYSTATE have “lost my forms” levied my business when I had already paid them etc… Maybe it is just the NY processing area but serioiuisly beware! I am currently awaiting a refund for a YEAR now! because they sent my check (they say) to an address I lived at 7 years ago!!!!

    Still they will freeze your assests and I had to hire a lawyer and pay for him to go to court and they never showed up! or were “not ready”

    I had 3 accounting people sit on a conference call and witness them lie about at least 6 documents. Because of this I pay VERY hefty accounting fees to protect myself and my company from this nightmare of mismanaged goverment agencies…..I am frankly shocked how terrible this (and maybe all) agency is run state and federal level. Now we have TARP? oh my god I am scared for all of us!