I Can't Pay the Taxes I Owe! What Are My Options?
Tax season is no one’s favorite time of the year, and during periods of inflation or other financial struggles, it can be even more painful. Around $1 trillion is paid annually in individual income taxes, and the average tax rate is around 15% in America. If you have been faced with the troubling thought, “I can’t pay the taxes that I owe,” there are several ways to address your tax burden this year, including an auto pawn. It’s never a solution to not pay your taxes. Here's what you should do instead.
7 Options To Try When You Can't Pay Your Taxes
1. Look Into An Online Payment Plan
If you find yourself unable to pay the taxes you owe, an online payment plan may be the way to go. This plan lets taxpayers pay off a tax balance over time, agreeing to pay equal amounts as installments every month.
It’s easy to apply on the IRS website and such plans are quickly processed (usually even faster than electronically filing your taxes).
There are two main payment options. A short-term plan usually covers up to 120 days in a payment period for amounts owed that are lower than $100,000. A long-term plan is over 120 days, paid monthly, and the amount owed is under $50,000.
2. Try For An Offer In Compromise
Another IRS-sponsored approach if you can’t pay taxes that you owe is what’s known as an “offer in compromise.” This allows citizens to settle tax debts for a compromised amount that is less than the originally owed amount. There are stricter guidelines tied to this option, and the IRS will consider your assets, income, expenses, and more when weighing approval.The IRS says a compromise is generally approved if what’s offered is close to what they can expect to collect within a fair timeframe.
3. Pay What You Can
It’s tempting to avoid paying your taxes entirely when it truly seems that you can’t pay the taxes you owe. But when it comes down to it, it’s always better to file and pay what you can or send monthly payments on your own.
By submitting even part of your taxes on time, you’ll avoid fees associated with late payment or no payment. And, by avoiding payment completely, you could be setting yourself up for an even more substantial financial burden in the future.
4. Consult a Tax Attorney
Paying for a tax attorney may not be for everyone. But if your tax situation is complicated or you owe a lot of money, that can leave you feeling overwhelmed, and a tax professional can help. They can help you sort out exactly what you owe, offer advice if an installment plan is the best route to make, and more.
A tax expert can also work with you to set up a plan, so you won’t face the same tax issue again. They can outline a savings plan, help you adjust the amount you’re withholding from your income each month, and generally foresee any future problem that can be taken care of sooner rather than later.
5. Be ProactiveThere is usually a two-month or so, unofficial grace period before the IRS gets in touch with you about owed taxes. But even so, if you can’t pay the taxes you owe, it’s wise to continue sending the IRS every little bit you can to deduct from your balance before they contact you.
6. Procure Hardship Status
The IRS can declare your taxes owed ‘uncollectible’ if you qualify for hardship status. Taxpayers need to prove that they simply do not have the means to cover their tax bills. Though it stops collection, hardship status is temporary. The IRS will check back into your tax account every year or two to see if your situation has improved.
7. Get an Auto Pawn
If you find yourself with a very high tax bill, an auto pawn is an option to overcome such a financial emergency. With an auto pawn at Georgia Auto Pawn, Inc. you may qualify for a title pawn of up to $15,000 in as little as 30 minutes.
It’s easy to qualify at Georgia Auto Pawn, Inc. All you need is a driver’s license or state-issued I.D., the lien-free title to your vehicle, and your car for inspection.
To begin, just fill out the short auto pawn inquiry form on our website. One of our pawn representatives will quickly get in touch to guide you through the rest of the process. If you are approved and qualify, you can receive your auto pawn cash the same day or the very next business day.
Get Started Today
Owing taxes is often a very stressful experience, but it doesn’t have to be. An auto pawn offers the option of a short-term loan to help you quickly and easily address this financial emergency. Just go online, give us a call, or visit one of our many Georgia locations most convenient to you today.
Note: The content provided in this article is only for informational purposes, and you should contact your financial advisor about your specific financial situation.