When people fail to meet their tax obligations, they are penalized. The biggest fear any taxpayer has is the fear of being penalized. Considering that you are unable to fulfill your tax obligations due to financial hardships, being penalized is adding an insult to an already wounded person. There is, however, a way for such people to evade these penalties. The way to avoid the penalties is through tax reliefs.
When your tax payments are delayed, the only way to evade the penalties is by tax relief. The different methods of tax relief are kept away from the public eyes by the tax firms as much as possible. The accessibility of the information regarding tax reliefs is however not entirely impossible. Seven methods of tax relief known to work in avoiding tax penalties are bankruptcy, hardships, making of partial payments, streamline pay agreements, penalty abatement, offer in compromise and the amendment of own tax obligation. Below are three of the most effective tax relief methods among the seven.
Being declared bankrupt is the first and an almost guaranteed way of getting tax relief. Part or the whole of a person’s tax debt may be lifted if a person or institution is declared bankrupt. Being bankrupt, one is perceived to lack the ability to pay the debt he owes the tax collector. Caution should, however, be taken because tax relief may be denied to a person applying to get tax relief when in the process of filing for bankruptcy. A clear guidance on applying for this type of relief can be given by your attorney. Get tax debt help here!
The other way of getting tax relief is when you are undergoing temporary or permanent hardships. Tax obligations, as well as any penalties, are exempted from these people undergoing hardships by the tax collecting body. Circumstances that may qualify as hardships may include being hit by disasters like earthquakes and tsunamis, having a permanent medical condition that affects your income generation among many more in that line. When such happens, you only need to file for tax relief quoting the hardship as the reason for exemption. Discover more facts about taxes at https://www.britannica.com/topic/value-added-tax.
The partial pay agreement with the tax collection firm is the third method of obtaining a tax relief. As a taxpayer, you may enter into an agreement with the tax collection firm to allow you to make your payments in agreed monthly remittances and not necessarily in full. Signing of the agreement gives the taxpayer the opportunity to send monthly minimum amount to the tax collector until the debt is paid in full. This solution can work best if the chunk being taken by tax is crippling your other activities and needs. The above methods of getting tax relief may be known by a few people but they are all legal and open to any taxpayer. Get irs tax help here!