IRS Fresh Start: The Truth About Tax Relief Initiatives

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Many Americans, especially over the last few years, have found themselves in dire straights of financial hardship. This makes bills and monthly payments difficult, on top of paying their tax debts. No matter your financial situation or the state of your tax returns, it is always good to know where you can get a little bit of help.

IRS Fresh Start Tax Relief Program Overview

The IRS Fresh Start tax program is a set of initiatives designed to help you if you are having problems and cannot pay your taxes. These IRS Fresh Start initiatives work for those who are possibly looking for an installment agreement if they are unable to pay the full amount of what they owe. If you are considering applying for IRS Fresh Start relief, here are some key takeaways from the program:

  • Streamlined and customized procedures
  • Installment payment plans are available.
  • Mandates the IRS cannot collect more than you are able to pay.
  • The program increased the amount qualifying for Federal Tax Liens from $5,000 to $10,000, which led to fewer filings and tax liabilities
  • Allows Installment Agreements for small businesses to be easier to obtain.
  • Expanding the qualifications for the Office-In-Compromise program has made it more user-friendly for taxpayers.
  • Option to work with tax relief companies that specialize in this area such as Tax Relief Advocates, Anthem Tax Services, CommunityTax, Fortress Tax Relief, Precision Tax Relief or Tax Defense Network

To determine if you are eligible you may have to visit the IRS website, call or email an IRS representative or visit your local tax office. 

IRS Fresh Start Pros and Cons

Pros Cons
Reduces penalties and interest on the penalty Every payment option has its own set of qualifications for eligibility.
Can prevent tax lien being filed against you the taxpayer You may have to work with a tax relief company or other tax professionals to make sure you don’t pay more than you owe.
Requires no disclosure of income or assets to the IRS You cannot be associated with any tax fraud or evasion activities.

4 Main Fresh Start Initiatives and Payment Options

Essentially the IRS Fresh Start Program can be broken down into four main initiatives. The payment options include

  1. Offer in Compromise
  2. Installment agreement
  3. Penalty abatement
  4. Currently Not Collectible status
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1. Offer In Compromise 

Offer in Compromise, or OIC, is when you are eligible to settle for a reduced amount rather than having to pay the full amount you owe. Here are some key takeaways from OICs:

  • You are not currently involved in a bankruptcy case.
  • You’ve made all estimated payments on your filed tax returns.
  • You have an approved extension for your current tax year return. 
  • If you are self-employed, you’ll need to verify you’ve made your last two deposits, in addition to your current one. 

2. Installment Agreement 

If you qualify for this option, as the name would suggest, you would be allowed to break your payments into reasonably more affordable monthly payments. These payments would continue to the IRS until the debt was paid in full. You should note that once the debt dips beneath $25,000, previously existing tax liens and levies will be removed. 

3. Penalty Abatement 

For this method, you will need to prove to the IRS that the reason you haven’t paid your tax bill is both reasonable and worthy of penalty relief. If they accept the reason you’ve provided, you may have your penalties forgiven. This can make paying down your tax debt a much more achievable goal. 

4. Currently Not Collectible Status

Unlike the other three payment options, this option is not a method but a status. This status allows payments to be put on hold during times of severe financial hardship. Features of the Currently Not Collectible status include:

  • Eligibility depends on your ability to show that paying both living expenses and back taxes will cause more financial hardship. 
  • It does not forgive tax debt but delays payment until you are more financially stable.
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Final Take To GO 

If the idea of approaching the IRS by yourself is overwhelming, many tax relief services can help you through these taxing times. Here are some top companies to consider:

  • Tax Relief Advocates
  • Anthem Tax Services
  • CommunityTax
  • Fortress Tax Relief
  • Larson Tax Relief
  • Precision Tax Relief
  • Tax Defense Network


Here are the answers to some of the most frequently asked questions about the IRS Fresh Start Tax Relief Program.
  • Who qualifies for the IRS Fresh Start Program?
    • To qualify for the IRS Fresh Start Program here are some possible requirements:
      • -If you are self-employed, you have dropped in income by at least 25%.
      • -You don't owe more than $50,000 in taxes, including penalties and interest.
      • -You must be able to pay your outstanding tax obligations within six years.
  • What is the IRS fresh start program for 2023?
    • The IRS Fresh Start Tax Relief Program is a set of initiatives that gives aid to struggling taxpayers to help reduce their tax debt. This is through the implementation of tax relief procedures such as the following:
      • -Debt settlement
      • -Payment plans
      • -First-time penalty waivers
      • -A temporary delay in tax collections
  • How much is the IRS Fresh Start Program?
    • Unfortunately, depending on the IRS Fresh Start initiative there can be setup and application fees. For example, the Offer-in-Compromise may charge up to a $205 application.
  • Is there really an IRS tax forgiveness program?
    • Yes, the IRS Fresh Start tax relief program offers several initiatives to aid you in paying your tax debts including:
      • -Offer in Compromise
      • -Installment agreement
      • -Penalty abatement
      • -Currently Not Collectible status

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