IRS Fresh Start Program
IRS Fresh Start Program

The IRS Fresh Start Program was designed to protect taxpayers from financial ruin by the IRS.

But, the IRS Fresh Start Program is not a magic wand that will wipe away everyone’s debt. The IRS Fresh Start Program is complicated to maneuver and understand, and even more difficult to qualify for.

Yes, the IRS Fresh Start Program does have a program that allows tax debt to be completely eliminated, something that many tax relief companies heavily market to obtain clients, but the logistics of qualifying for a total debt reduction is complex, difficult, and more than often requires professional help.

The IRS Fresh Start Program allows taxpayers to free themselves of their tax debt without damaging their financial reputation through bankruptcy. In fact, the IRS Fresh Start Program does not accept applicants who are currently in bankruptcy. However, you may be able to get tax relief via the IRS Fresh Start Program

What is the IRS Fresh Start Program?

The IRS Fresh Start Program is designed to allow taxpayers to pay off their tax debts affordably while avoiding severe collection activities from the IRS such as wage garnishments or tax liens.

The IRS Fresh Start Program has a number of different types of relief options. The most popular and easiest to obtain is an Installment Agreement while an Offer in Compromise is what most taxpayers strive to get.

Installment Agreements: The IRS Fresh Start Program’s Default Option for Taxpayers

Installment Agreements are simply a payment plan to the IRS, and unless you have proven yourself financially unfit for a payment plan, the IRS usually approves just about anyone for a payment plan.

If you have under $5,000 of tax debt, generally an Installment Agreement is the only program that you would be able to qualify for. Of course, this is dependent on your financial situation, so make sure you speak to a tax professional before resolving yourself to an Installment Agreement through the Fresh Start Program.

In general, the IRS Fresh Start Program aims to have their Installment Agreements stretch over the course of six years. This is generally enough time to allow the entire debt to be paid by a reasonable monthly payment.

However, it is important to note that Installment Agreements do still accrue interest on your total balance. While being on an Installment Agreement through the IRS Fresh Start Program allows you to remain compliant with the IRS, there are risks involved. Oftentimes if a taxpayer agrees prematurely to a monthly payment that they can not reasonably afford, they run the risk of defaulting on their agreement. This allows the IRS to immediately begin its aggressive collection tactics while making it more difficult for the taxpayer to requalify for the IRS Fresh Start Program again.

Offer in Compromise: The IRS Fresh Start Program’s

An Offer in Compromise is a settlement that the IRS and taxpayer come to based on the financial status of the taxpayer. Essentially, the taxpayer proves to the IRS that they are unable, and will never be able, to pay off their IRS tax debt without entering a financial hardship.

To compromise, the IRS and taxpayer decide on an amount that the taxpayer realistically could pay and settle the debt for the agreed-upon amount.

An Offer in Compromise, also known as an OIC, is extremely difficult to achieve, but it is possible.

As a rule of thumb, you should only apply for an OIC with the help of a tax relief company as a rejected offer in compromise can hurt your future chances of benefiting from the IRS Fresh Start Program.

If you are unsure about which IRS Fresh Start Program option is best for your financial situation, you may want to reach out to a tax professional to advise you. Many reputable firms will offer free consultations to determine whether you may be a qualified applicant for relief.

How to Apply for the IRS Fresh Start Program

The IRS makes you jump through a number of hoops before you are even able to apply for the Fresh Start Program.

First, you must be sure that you are fully compliant with the IRS. This means all of your past tax returns must be filed before you apply for the IRS Fresh Start Program.

If you have outstanding tax returns, the IRS will not qualify you for admittance into the Fresh Start Program. Additionally, you must stay current with your tax filings for all future years while you are enrolled in the Fresh Start Program.

There are a few ways to enroll into the IRS Fresh Start Program. If you have a low tax debt and are looking to be approved for a payment plan, you can contact the IRS directly via their online portal. If you would like to see if you can qualify for an Offer in Compromise or have a complicated relief case due to a high tax debt amount and/or unfiled tax returns, it would be best to contact a tax relief professional who can guide you in the right direction.

To check your qualification for the fresh start program, click here to complete a brief survey and be connected with a Verified FreshStartInfo partner.