What is IRS Fresh Start Program?

The IRS Fresh Start program is a federal initiative that makes it easier for individuals and businesses to pay back tax debt, avoid liens, and be able to have some relief from the pressures of the IRS itself. The following information will provide you with the information that you need to know about how to qualify for the program. If you would like a further explanation provided by a team of Fresh Start experts, please do not hesitate to call Horizon Tax Relief today.

One of the best recent improvements in the IRS Fresh Start program is the fact that the government increased the minimum liability for filing a tax lien from $5,000 to $10,000 in back tax debt balances. Although the IRS still has the ability to filed liens on back tax balances that are lower than $10,000 in certain cases, this recent change helps to protect tens of thousands of taxpayers each and every year. The Fresh Start tax lien change is not retroactive meaning the they cannot automatically withdraw a lien that was previously filed based on the $5,000 balance amount.

Under the Fresh Start program the IRS now has the power to withdraw a tax lien that was previously filed once the lien has been released. Typically a lien release occurs once your tax debt balance is at a zero balance. The lien remains on your credit report for up to seven years once the lien has been released. The lien withdrawal however will help to remove the lien for your records in order to repair your credit scores. Good credit is essential in applying for future loans.

Taxpayers and businesses that are eligible for the Fresh Start program may qualify to have your tax liens withdrawn once a direct debit payment plan is agreed upon. Both individuals and businesses are allowed for apply for withdrawal if the tax debt balance is below $25,000. The back taxes are required to be paid within five years or prior to the collection statute expiration date expires, whichever situation occurs first. It must be noted that the government does have the ability to file a new lien and re-start collections activity if a default where to happen on the direct debit payment plan once the lien is withdrawn.

The Fresh Start program enables taxpayers to qualify for a streamlined agreement with far more ease. The payment plan has been increased from $25,000 to $50,000 allowing far more people to take part in the program.

Small business that are currently in operation and owe the IRS a tax debt balance may qualify for the In-Business Trust Fund Express program. The government will typically waive the requirement of reviewing financial statements as proof of expenses if the tax debt balance is under $25,000. The entire debt needs to be paid within twenty-four months or before the Collection Statute Expiration Date whichever occurs first.

The Fresh Start program has certainly made it less difficult for taxpayers to qualify for an offer in compromise, which of course allows you to settle your tax debt for less than the full amount that is currently owed.

Factors to consider.

1: In order to qualify for the Fresh Start program the IRS will review your expenses, assets, income, and ability to pay.

2: Individuals and businesses must be have filled all current tax returns.

3: Open bankruptcy proceedings are now allowed.

4: Offers can be paid in a lump sump payment or a monthly payment plan.

5: If the IRS rejects the tax settlement offer all payments that are made during the consideration period are applied directly to the back tax balance amount.

6: The government charges a $186 application fee in order to process your offer in compromise paper work.

The IRS Fresh Start Offer In Compromise initiative is certainly not for everyone. If you owe the IRS a tax debt please make sure to contact Horizon Tax Relief in order to review all of your options.

We encourage you to call us for a FREE Consultation at (888)313-9296 to know more about how we can help you solve your tax situation.