Understanding IRS Tax Debt
For some people, filing taxes means a tax refund check will be coming in the mail. For other Americans, tax season translates into tax debt.
If you know you’ll owe money on your taxes this year, do not put off filing a return. While it might be tempting to delay repaying the debt or just not filing all together, you’ll only make matters worse if you file late. The IRS charges penalty fees of up to 25 percent for filing late.
If you can’t repay your IRS tax debt, check to see if you qualify for settlement options or extensions from the IRS. If the IRS doesn’t grant you a settlement or payment extension, there are still other ways to pay back your debt, including using credit cards and personal loans.
If you could repay your tax debt if you just had a little more time, you might be able to use an IRS payment plan. Research your options to ensure you have the best plan in place.