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IRS Settlement Options

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When clients think of settling their IRS tax debt, they often assume that there is only one option.  There are in fact six options available.  Here is a basic summary of those options:

 

1. Let it expire
2. Suspend it
3. Adjust it
4. Pay it
5. Compromise it
6. Discharge it

 

Each of these options has a pro and a con to it.  However, one option is better than the other five and it is usually obvious.  On occasion, the best option is to start with one and at an appropriate time switch to a better one that did not qualify for at the time the IRS or you wanted a settlement.

 

In order to properly evaluate how each of these options applies to your situation we need to know four facts:

 

• The tax years you have a debt.

• Did the IRS file a substitute return for any of the years you have an IRS tax debt.

• The amount you owe for each year.

• Full and complete financial information about your income and personal living expenses.

 

No IRS resolution professional can tell you which settlement option you qualify for and what the settlement amount will be without these four pieces of information.