The IRS Fresh Start Program
IRS Fresh Start Program
If you don't pay your IRS taxes on time, you could face penalties, interest, tax levies, tax liens, asset seizure, wage garnishment, and potentially result in the IRS taking you to court.
In response to the IRS's exploitative collection techniques, the government developed the IRS Fresh Start Program, which makes it easier for individual taxpayers and businesses to pay their back taxes.
The IRS Fresh Start Program provides taxpayers with more flexible repayment terms and initiatives that may decrease or eliminate their tax debt without imposing penalties. Taxpayers may be able to have their federal back taxes forgiven almost entirely under certain circumstances.
There are four programs that make up the entirety of the Fresh Start Program:
Offer in Compromise
Currently Non-Collectible Status
What Is The IRS Fresh Start Program?
The Fresh Start Program, also known as the Fresh Start Initiative, was established by the U.S. government in 2011. The Fresh Start Initiative Program offers tax assistance to a certain crowd of people who owe the IRS money. It is the federal government's reaction to the IRS's predatory methods, which include the use of compound interest and financial penalties to penalize people with unpaid tax debt.
How Does The Program Work?
Let's say a taxpayer owes the IRS $10,000 in unpaid taxes, plus compounded interest and penalties, over the course of several years. This taxpayer may be unemployed and unable to pay for electricity and other living expenses. They do not have the financial resources to pay the IRS $10,000, and they will very certainly never be able to return the amount owed to the IRS.
The IRS is prohibited from collecting more than a taxpayer is able to pay under the Fresh Start Program. This assists the taxpayer in reaching an arrangement with the IRS and allows them to pay a reasonable amount. The IRS's key criteria for the interview is the taxpayer's financial status.
Before being accepted, the taxpayer may be required to fill out a form on the IRS website, contact or email an IRS employee, or schedule an appointment to visit their local IRS office to determine eligibility. To save some time, IRS Fresh Start Initiative has made it easier to get qualified for the Fresh Start Program, and it all begins here.
The IRS Fresh Start Program In 2021
Shortly after its outset in 2012, the Fresh Start Program was expanded to allow more taxpayers to apply for tax relief. The most significant change to the program is that the IRS now makes it easier to calculate a taxpayer's future income when considering an Offer in Compromise.
There have been no significant changes to the program since 2012. Nonetheless, the rate at which IRS examiners determine whether a taxpayer qualifies for tax relief has fluctuated in recent years.
The Fresh Start Tax Program received a record number of applications in 2020. The COVID-19 pandemic, which caused financial hardship for millions of Americans, was a major factor in the large increase in accepted offers for Fresh Start tax relief, as well as the IRS' leniency in approving cases.
However, many taxpayers, particularly students, parents, and small-business owners, are still facing financial difficulties in 2021. Tax experts believe that the IRS Fresh Start Program qualifications will remain loose around for much longer, but that the IRS will not continue to relax their strict application requirements forever.
The best way to find out if you qualify for tax debt relief in 2021 is to check your eligibility for the IRS Fresh Start Initiative with us as soon as possible.