Is there free legal help to resolve tax debt?

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Am in debt to the IRS for around $ 6000 or so. They are on the verge of filing a levy against me, but not if I can pay at least $ 95 a month towards my debt. Know I will never be able to pay it all off because of interest and all. And I don’t wish to spend the rest of my life with them keeping my tax refund every year. Just can’t continue to live like this. They have no heart. Know there’s an Offer In Compromise, but who can I get to help me with that? I can’t afford to pay an attorney. Is there an agency that offers “free help”? Or a loan company that will make a loan regardless of my credit, because it’s really bad.

7 Comments
  1. Reply
    Bob F
    November 12, 2011 at 1:28 pm

    They won’t accept an offer in compromise if either 1) they feel you have assets you could sell to pay your taxes or 2) they feel you have enough earning power to come up with the installment payments.

    $ 6000 or $ 95 a month is not an overwhelming amount to come up with. If you worked a second part-time job for a year, you could pay it all off. So unless you are disabled or something, forget about the OIC and find a way to make the installments. Even if you can’t come up with the whole amount every month, pay what you can and eventually it will go away. Right now you are incurring about $ 30 a month in interest, so any month you pay more than that, you are gaining on it.

  2. Reply
    Helen, EA in PA
    November 12, 2011 at 2:23 pm

    Just set up a payment plan. You really are not a candidate for an offer unless you cannot work. Don’t worry about paying it all, after 10 years after assessment, it disappears.

    And stop getting a tax refund, use that extra money to pay off your debt.

    Helen, EA in PA

  3. Reply
    Big Woof
    November 12, 2011 at 2:27 pm

    The IRS will accept a payment plan. They will huff about paying it all now. See a competent professional tax person. Many will help on your behalf for not a whole lot of $ $ $ .

  4. Reply
    Wayne Z
    November 12, 2011 at 2:52 pm

    Unfortunately, you have to owe over $ 10,000 usually before the IRS will even consider an OIC.

    Get on the installment agreement and stick to it.

  5. Reply
    Judy
    November 12, 2011 at 3:30 pm

    In theory you can file an Offer in Compromise yourself, but it’s not easy to do correctly. And I don’t know of any agency that would do it at no charge – if you want help doing it, you’d almost surely have to pay the person.

    With really bad credit, extrememely unlikely that you can get a loan for this. And then you’d just owe the payments to someone else, so what would you have gained? If you say well, then you could get it wiped out by bankruptcy, you just answered your own question on why you wouldn’t be able to get a loan.

  6. Reply
    wartz
    November 12, 2011 at 4:23 pm

    If, based on IRS allowable expense standards, you are unable to make any payments, your account can be classified as currently not collectible. I would stay inactive until you income improved. If you can pay it in full within five years, IRS will set up an installment agreement.

    There is no official lower limit to the amount that can be included on an offer in compromise but there ordinarily is little point in making an offer on a small amount unless it is more than obvious that the collection potential is zero.

    You are not going to get professional help for free. I handle these professionally and have a lower rate for small cases but ir is never going to be free and the retainer has to be paid up front. Offers all take a good deal of time to put together and once they are done you have to pay the amount offered. If you can’t do that there is no point in starting.

  7. Reply
    John Scott
    November 12, 2011 at 4:23 pm

    As others have noted, you’re not likely to qualify for an offer-in-compromise if you have any payment ability. Moreover, it costs $ 150 to apply and you have to pay 20% of your offer amount up front (or the first month’s payment if you elect the payment option).

    Your best bet is to get an installment agreement for the minimum amount requested and then send more as you are able. Between that and your tax refunds, you’ll eventually get it paid off.

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