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Posted by Dennis Jao

What is the IRS Fresh Start program?

What is the IRS Fresh Start program?

Taxpayers are paying lower taxes as individuals or businesses, which is a massive change in the pocket of many. The umbrella covering these taxpayers is called the IRS Fresh Start program. The program started in 2011 but kick-started in early 2008's Great Recession to aid struggling taxpayers. There are many benefits from this program. 

Small businesses get to clear their tax debts, including installments, Offers in Compromise, and many others. The initiative is helping taxpayers pay debt instrumentally, reduce debt and stop collections proceedings. The system favors taxpayers by avoiding incurring debts such as tax liens, levies, or even jail time while struggling with one. The Fresh Start initiative is a paradise for most taxpayers to sit, relax, and build again.


Are You Qualified?

The program is trending, and the benefits are not exaggerated. However, there are requirements to enter paradise. If you fulfill these requirements, you're set for a life of no debt. Here is what you need to get ready. 

  • Those that experienced a 25% cut in salary and are self-employed

  • Those with income lower than $10,000 and single; $20,000 and married

  • Those with debt below $50,000

In summary, you must not have an excessive debt with the IRS to qualify.

Program Option

The IRS Fresh Start Program is legal and the easiest way to clear debt, avoid future debt, and still make back some dollars. 

1.     Extended Installment Agreement 

This option is for those that owe the government $50 000 or less. The debt is paid in percentages from your current salary or earnings and your assets each month. You have six years to pay up without interest. You're also free from wage garnishment, tax liens, and asset seizing. The IRS works hard to ensure the process is swiftly done. 

2.     Offer In Compromise (OIC)

This option is hardly available but allows taxpayers to remit their debt as dues. A taxpayer can negotiate to pay lower than the amount owed. However, your IOC statement has to be convincing to beat the court. The form is complicated and requires trained and experienced persons to get an IOC application accepted. The option is rare and mostly attainable by professionals. 

3.     Tax Lien Withdrawal 

The option interests debit card taxpayers who intend to pay the debt in one sitting. The debtor will hand out a written instruction allowing the IRS to withdraw the fund directly from their account. Taxpayers should avoid this act. However, some past debtors have reported such cases to the credit bureaus.

How To Apply

To be an acceptable candidate for the IRS Fresh Start Program, you must know all your tax debt. The knowledge is to convince the office you're aware and willing to pay the debt. Since the program has different options, so is the protocol. However, here is a general way to make an application. 

  • Most professions are ready to assist you for free regarding these matters. Contact an enroller, a CPA agent, a tax resolution company, or a professional. Any of these people can help you summarize the debt to your understanding. 

  • Gather every document or receipt concerning your tax debt as requested by the application process. 

  • Get a form, complete and submit it on the IRS's website.

  • Get any document that will support your cases, such as hospital, travel, charity, and court records.

You must also report and complete any missing or unfiled tax returns, proof of current tax payment, and your current balance must be accurate. Lastly, the previous 6 months' taxes are to be filed separately, which must be current and correct. 

A shortcut to this process is through a professional tax relief firm or individual. These people can help you file an appeal when you get rejected.



Dennis Jao
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