Sunday, May 30, 2010

It Pays to Settle Your Back Taxes

Each year there are a significant number of people that fail to file and pay income taxes. These back taxes may be owed to local, state or federal entities. Individuals who fail to file and pay taxes are essentially breaking the law and can eventually have criminal consequences. From a financial standpoint, eventually these payments add up, the government catches up with the outstanding debt and cashes in on the back taxes that are owed to them.

There are several reasons why individuals may fail to file taxes; the most common include not having enough money to pay or disagreeing with the concept of paying taxes altogether. It is not uncommon for some people to owe back taxes for multiple years. Failing to file taxes gets easier if it becomes a habit year after year. The best way to avoid criminal charges for non payment of back taxes is to settle your debt as quickly as possible. It pays to settle this government debt on your terms rather than waiting to get caught. The bottom line is that everyone has to pay taxes or face criminal charges.

Late payments to any entity, including late tax payments, incur penalties and fees. Waiting years to file and pay back taxes results in the individual not only potential criminal charges, the payment of the back taxes but thousands of dollars extra because of fees associated with non-payment. These fees will depending on the length of time the back taxes remain outstanding. Regardless of how long a person has gone without paying taxes it is best to get this taken care of.

You can take the following steps to start the process of settling up your outstanding tax debt.

  • Work up your own budget to determine what type of monthly payment you can afford to make to settle your back taxes.

  • Research tax professionals that specialize in back taxes and identify a professional that can assist with your situation.

  • Review your budget with the tax professional so he or she is aware what you can reasonably afford to pay and begin the process of repayment.

Working with a tax professional can offer the following benefits and services:

  • Minimize any legal consequences that face you.

  • Ensure that you file taxes properly and according to the law.

  • Determine the best course of action to begin payback of you.

  • Arrange with the entity an affordable payment plan and the payment arrangements on your behalf.

  • Negotiate and get lower fees and penalties for back tax payments.

  • Prepare, complete and file your tax documents and returns properly.

It is possible to take matters into your own hands and arrange your own back tax payments. This can be done using a computer program or tax preparation kit, however if you have multiple years of back taxes it pays to seek out the guidance and assistance of a professional.

This article is provided for, a site designed to help you pay back taxes. Owing back taxes to the IRS is stressful, and negligence will only worsen the situation. Learn how to get back tax relief.

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