Negotiating with the IRS: 3 Blunders to Avoid

Taxpayers on the IRS ‘watch list’ know just how intimidating the agency’s enforcers can be. Yet rather than face their tax debt problems head on, most people tend to shrug it all away. Some taxpayers, however, are brave enough to address their situations. Then again, only a few know which mistakes to avoid when negotiating a settlement with IRS.

Not considering the possibility of an error. IRS employees deal with mountains of forms each day, so there is always the possibility of human error. Review your records carefully and request for an appeal hearing if you notice discrepancies. Note, however, that appeals are time sensitive and very technical, so it’s best to consult a tax lawyer first.

Not providing accurate information in the forms. Forms 433a, 433-b, and 433-f aren’t like your tax return forms. The IRS will carefully pore over every detail you provide to make certain you are indeed capable of paying your tax obligations. That being said, it is crucial to fill out these forms correctly. Have them reviewed by a tax debt expert so your story would be airtight.

Not ensuring current tax compliance. The IRS requires full tax compliance for tax settlement negotiations. This means that you are expected to make the correct payments and see to it that all of your filings are updated to the current year. Fail to satisfy these requirements, and your negotiating efforts may all be an exercise in futility.