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  • Writer's pictureBui Taxology

Options For Settling Your IRS Tax Debt

Debt is never a good thing, but when it comes to owing the Internal Revenue Service (IRS) money, they don't mess around. If you owe the IRS tax arrears, in most cases tax agents can seize practically everything you own without approval. This includes bank accounts, certificates of deposit, and accounts receivable. With an IRS manager's approval, an IRS Revenue Officer can take things like your vehicles, business assets, jewelry, and real estate. With a judge's permission, even your homestead can be seized and sold to pay I.R.S. taxes.


The IRS is willing to work with you if you are willing to compromise and work with them. There are several different ways that things can be handled:

Currently not collectible. Some people, even according to I.R.S. standards, cannot afford to pay. For them, it's important to demonstrate to the I.R.S. that they cannot pay, and the I.R.S. will "put their file on a shelf," and periodically check back to see if anything has changed. If it doesn't the taxes can eventually become barred by the runnnig of the statute of limitations.

Installment Agreements. If a taxpayer has a significant income and/or a sizable amount of property, Mr. Black can negotiate with the IRS on your behalf to work out a payment plan. He will help you fill out an IRS Collection Information Statement listing all of your assets, debts, income, and necessary monthly living expenses and then he will try to get the IRS to let you do a payment plan.

Offers in Compromise. If you owe a large amount of taxes, an Offer in Compromise may let you settle with the IRS for less than the full amount owed. However, one big part of the offer is that you must agree to strictly comply with IRS laws for the next five years.

File for Bankruptcy. Once you file for bankruptcy, an automatic stay goes in to effect and it stops the IRS from taking any further collection on your account. Not all taxes are dischargeable, so it's essential that you speak with a knowledgeable Houston bankruptcy attorney like Mr. Black to make sure that the taxes can be discharged.

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