Owe the IRS Tax Law is a highly intricate area of the law. Attorneys who specialize in this area of the law are admitted to a special tax court, which deals only with tax law issues.

If after filing your tax returns you find out that you owe large tax liability, here are some tips on what to do next.

Ways you can end up owing the IRS

You can find out that you owe the IRS a large sum in several ways, including:

  • Following an audit--the IRS audits you and determines you have  a liability
  • Final assessment, district court or tax court order-- your case has been unsuccessfully argued in court
  • Filed return but couldn't pay at the time
What to do
If you find yourself in the position of owing a large liability, and not being certain you can pay, you should still:
  • File your return on time, even if you don't have the money to pay when you file, you don't want to risk the additional penalty of filing late
  • Talk to someone- whether it is an attorney, accountant, or other qualified professional
Payment options
There are several different options if you cannot pay your liability right away, you might be able to secure:
  • An Installment agreement
  • Non-collectible status- due to your financial status, you could be temporarily placed on non-collectible status
  • An Offer in Compromise
  • Discharge liability in bankruptcy court
Additionally, watch out for potentially predatory tax settlement firms. Firms that spend large amounts on advertising may have less to spend on high quality legal representation. In addition to thoroughly assessing the quality of the attorneys to represent you, be sure you understand the terms of payment, e.g. whether there is a large up front fee versus a flat fee, and what those fees pay for.

Most importantly, however, do not ignore any correspondence from the IRS. Sometimes mistakes are made, and even if not, you will surely be in a better position to negotiate a more favorable resolution if you are responsive to correspondence from the beginning.

Start your search for a qualified Tax Attorney today.

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