Uh Oh, I owe the IRS Money
Have you found that you owe the IRS money? This can be a lot or a little. It doesn’t matter. The only thing you should be thinking about is that you need to pay this debt as soon as you can. When you owe the IRS money it means that they will be watching closely to ensure that you pay as soon as possible. Of course, owing money and paying money is not the same thing. The worst situation to be in is to owe a lot and not be able to give the IRS what they want.
Instead of sitting around feeling sorry for yourself you need to open the lines of communication with the IRS. Tell them that you are aware of your tax liability, but that you are not going to be able to pay them in one lump sum. This is not something that they are going to fight. In fact, they will be glad that you are aware of your situation and willing to pay them in another way. They will more than likely suggest an installment agreement that allows you to pay your entire debt, but over the course of several months.
Those who are in a terrible financial place and have no prospects for a comeback in the near future may be able to settle their tax debt. This means paying less than what is owed. The IRS allows you to make an offer in compromise. Just remember, they do not have to agree to settle your debt.
It is a big deal to owe the IRS money. But you can make things much worse on yourself if you decide that you are not going to pay.
