Hawaiian taxpayers can use a variety of Internal Revenue Service tax settlement options to repay their outstanding tax debt. Some tax settlement options will allow the taxpayer to pay much less than the full amount of money owed. The IRS wants to help taxpayers meet their tax obligations and will often accept an IRS tax settlement offer if it will help taxpayers pay all of their future tax obligations.

The IRS has been given the authority from the federal government to collect outstanding IRS tax debt. The IRS also has the ability to use very aggressive collection tactics such as wage garnishment, bank account levies and property repossession if Hawaiian taxpayers fail to pay their tax debt. All Hawaiian taxpayers who have outstanding tax debt will want to discuss the IRS tax settlement options with a tax professional.

Offer in Compromise

Although Offer in Compromise (OIC) is one of the most common settlement options it also can be one of the most difficult to qualify for. An OIC allows the Hawaiian taxpayer to make an offer to the IRS and if the IRS accepts the offer, the taxpayer may be able to settle IRS tax debt for a fraction of the total amount of tax debt owed. To qualify for an OIC, the Hawaiian taxpayer must meet stringent OIC requirements and convince the IRS that the amount of their offer is greater than or equal to the total amount tax the IRS could collect through aggressive collection actions.

The IRS will not accept all OIC offers and if they deny an offer, the IRS can use the detailed information they have gathered to continue collections. Penalties and interest will continue to collect on all outstanding IRS tax debt until the OIC is accepted. All Hawaiian taxpayers who are considering Offer in Compromise should contact a tax professional for more information.

Qualifying for Offer in Compromise

Hawaiian taxpayers must meet one of the following requirements to qualify for Offer in Compromise:

• Doubt as to Liability- There must be a legitimate question about the amount of tax debt owed by Hawaiian taxpayers for the IRS to grant an OIC under this condition. This condition is not frequently met.
• Doubt as to Collectibility- The amount of tax debt is not in question only the ability of the IRS to collect the federal taxes before the statutory period of time expires.
• Effective Tax Administration- Hawaiian taxpayers who can not pay their federal tax debt with out suffering a hardship which would be inequitable or unreasonable may qualify for an Offer in Compromise. This condition is most frequently used for handicapped or elderly individuals.

The following tasks must also be completed by Hawaiian taxpayers:

• Hawaiian taxpayers must pay all federal tax debt on or before the federal deadline for the next five years.
• Hawaiian taxpayers must meet all of the requirements outlined in the Offer in Compromise.
• Hawaiian taxpayers must complete and submit all federal tax returns to the IRS by the federal tax deadline.

Installment Agreements

Installment agreements are the most common type of IRS tax settlement option. An installment agreement allows the Hawaiian taxpayer to pay their back taxes in monthly installment payments. The taxpayer will be required to pay all their tax debt in a specific time period which can vary based on the total amount of outstanding tax debt owed.

The IRS will generally accept an installment agreement if the taxpayers owes $25,000 or less. If the Hawaiian taxpayer owes more than $25,000 they will want to consult with a tax professional who can help negotiate an installment agreement. Penalties and interest will continue to accrue until the full amount of tax debt is paid. It is always less costly to make a lump sum payment for the full amount of IRS tax debt.

The IRS has the authority to deny or cancel an installment agreement if any of the following occurs:

• If the Hawaiian taxpayer does not pay their monthly installment payments or pays less than the full amount due. First time violators may be given a thirty to sixty day grace period.
• If the Hawaiian taxpayer fails to submit their federal tax returns each year.
• The financial status of the Hawaiian taxpayer substantially improves.
• The Hawaiian taxpayer provides incorrect financial data to the IRS when applying for the installment agreement.
• Hawaiian taxpayers who are self-employed must file federal tax returns each quarter and make their quarterly tax payments.
• If the Hawaiian taxpayer does not pay all of their tax debt for the five years before the IRS debt which can not be paid.
• If the Hawaiian taxpayers has had another installment agreement within the last 5 years.

Partial Payment Installment Agreement

Hawaiian taxpayers who are unable to make the minimum payment with an installment agreement may qualify for a partial payment installment agreement or PPIA. The PPIA will allow the Hawaiian taxpayer to pay less than the full amount owed to the IRS for a specific time period. The PPIA can be less expensive, time consuming and less complicated than an Offer in Compromise.

Unfortunately, interest and penalties will continue to collect on the outstanding tax debt until the debt is completely paid. The IRS will cease collection actions under a PPIA but will review the financial status of the taxpayer every 2 years to determine if the PPIA can be modified for cancelled.

Currently Not Collectible

The IRS may decide that some debt can not be collected. If the IRS makes this determination about a Hawaiian taxpayer’s IRS tax debt the status will be changed to currently not collectible. If a taxpayer’s debt is determined currently not collectible, the Internal Revenue Service will stop all collections against the taxpayer.  If the IRS can not collect the debt within ten years the debt will be forgiven.

Interest and penalties will continue to accumulate on the outstanding tax debt even under the currently not collectible status. The Internal Revenue Service will send written notification each year to the Hawaiian taxpayer outlining the amount of taxes owed. This notice is not considered a tax bill.

Penalty Abatement

Penalty abatement allows the IRS to eliminate part or all of the penalties assessed against taxpayers. The IRS assesses penalties for a variety of reasons including: failing to file a federal tax return, providing inaccurate tax information or requesting a false refund.

The IRS will, under certain conditions, abate or lower penalties against Hawaiian taxpayers. Valid reasons might include: receiving incorrect advice from a tax professional, or failing mental or physical health. The may be certain penalties which the IRS will not lower or abate.

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Montana taxpayers now have a variety of IRS tax settlement options they can use to settle federal tax debt. Many available options will allow Montana taxpayers to pay a fraction of the total amount owed. The Internal Revenue Service (IRS) may accept an IRS tax settlement to help Montana taxpayers meet their tax obligations and help the IRS avoid an extended installment agreement or avoid declaring debt as currently not collectible.

The federal government has given the IRS the authority to collect federal tax debt and if necessary to use very aggressive tax collection actions (wage garnishment, repossession, bank levies, imprisonment) against the taxpayer. Montana residents who have become the target of these actions may want to consult with a tax professional to discuss their IRS tax settlement options.

Offer in Compromise

One of the most common types of IRS tax settlement options is Offer in Compromise or OIC. Offer in Compromise allows the Montana taxpayer to make an offer to the IRS. If the IRS accepts this offer it is considered a “compromise” and all the taxes outlined in the OIC agreement will be settled after the Montana taxpayer meets the requirements of the agreement. The IRS has sole discretion to reject or accept Offer in Compromise offers.

The IRS will accept approximate 25% of first time OIC offers but may be willing to accept more after negotiations or a formal appeal.  Penalties and interest will continue to accrue while the IRS is considering the OIC, but if the OIC is accepted, collection efforts will cease.

Offer in Compromise can be expensive, time consuming and difficult to implement. The Offer in Compromise application process will require Montana taxpayers to send detailed financial information to the IRS which they can use to continue collections if the Offer in Compromise is denied. Offer in Compromise is one of several IRS tax settlement options available to Montana taxpayers and it may not always be the best.

Qualifying for Offer in Compromise

Montana residents will only qualify for Offer in Compromise if they meet one of the following criteria:

• Doubt as to Liability- The IRS must believe the amount of IRS tax debt assessed could be incorrect. This could be due to a miscalculation or if additional tax information is provided. This condition does not frequently occur.
• Doubt as to Collectibility- The IRS may grant an Offer in Compromise if they believe they will not be able to collect the IRS tax debt either now or in the future.
• Effective Tax Administration- Montana taxpayers who can not pay their IRS tax debt because doing so would cause a “hardship which is inequitable or unfair” may receive an Offer in Compromise. The handicapped and elderly most frequently qualify under this condition.

The following tasks must also be completed by Montana taxpayers:

• All IRS tax debt must be paid on or before the federal deadline for the next 5 years.
• All of the requirements outlined in the OIC must be completed.
• All federal tax returns must be completed and submitted to the IRS by the federal tax deadline.

Installment Agreement

Montana taxpayers who do not want to apply for an OIC or who may not qualify may be able to use an installment agreement to pay IRS debt. The installment agreement will require the full amount of tax debt to be paid, but payments can be extended over a set period of time. The IRS generally accepts installment agreements for taxpayers owing $25,000 or less as long as the debt is repaid within 60 months.

Montana taxpayers who owe more than $25,000 should contact a tax professional for help negotiating an installment agreement. The installment agreement will not stop the penalties or interest from accumulating, but it will stop the aggressive collection efforts. It is always less expensive to make one lump sum payment for tax debt. The IRS has the authority to deny or cancel an installment agreement if any of the following occurs:

• Fails to pay their monthly installment payment.
• Fails to submit their federal tax returns each year.
• Fails to pay the full amount of the tax payment due each month. First time violators may be granted a 30-60 day grace period.
• The financial status of the Montana taxpayer improves drastically
• The Montana taxpayer provides incorrect financial information to the Internal Revenue Service on the installment agreement application.
• Montana taxpayers who are self-employed fail to file federal tax returns each quarter or make their quarterly tax payments.
• Montana taxpayers fail to pay all of their federal tax debt for the five years before the IRS debt which can not be paid.
• Montana taxpayers have had another installment agreement within the last five years.

Partial Payment Installment Agreement

Montana taxpayers also may be able to settle their IRS tax debt with a partial payment installment agreement or PPIA. The PPIA can be much simpler and less expensive to implement than the OIC, but it may allow Montana taxpayers to pay only part of the tax debt owed. Unlike the installment agreement, the PPIA will allow Montana taxpayers to make partial monthly installment payments. All taxes which are not paid may be forgiven.

Penalties and interest will continue to accrue, but the IRS will cease all debt collection actions against the Montana taxpayer. The Internal Revenue Service will review the partial payment installment agreement every 2 years to determine if the Montana taxpayer’s financial condition has improved, if it has, the IRS may decide to modify or terminate the plan.

Currently Not Collectible

Under certain conditions the IRS may determine the Montana taxpayer’s debt is not collectible and they will change the tax status to “currently not collectible”. Under this status, the IRS will cease all collection actions against the Montana taxpayer. Interest and penalties will continue to collect on the outstanding tax debt.

The IRS will send a letter each year detailing the amount of outstanding tax debt the Montana taxpayer owes, but this letter is not considered a tax bill. The IRS has ten years to collect all tax debt. If the IRS fails to collect the tax debt within this time period the statute of limitations on the debt will expire and the debt will be forgiven.

Penalty Abatement

Penalties may be assessed against Montana taxpayers for a variety of tax reporting infractions including: failure to file a federal tax return, misrepresenting financial information either accidently or intentionally, or requesting a false refund. The IRS may be willing to abate or lower the penalties if the Montana taxpayer has a valid reason for the mistake such as: personal duress, incorrect professional tax advice, poor physical or mental health or a natural disaster occurred. The IRS may not be willing to abate all penalties.

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New Hampshire taxpayers who have outstanding IRS tax debt may be able to settle their debt for a fraction of the full amount owed by using an IRS tax settlement option. The Internal Revenue Service or IRS has the ability not only to collect federal tax debt, but to use a variety of very aggressive debt collection tools against New Hampshire taxpayers. Collection methods can include: wage garnishment, property repossession and bank account levies.

All New Hampshire taxpayers who have become the target of aggressive tax collection efforts or who have outstanding tax debt can contact a tax professional for help.

Offer in Compromise

Offer in Compromise or OIC is one of the most popular tax settlement options used by taxpayers. OIC allows New Hampshire taxpayers to make an offer to the Internal Revenue Service to settle their federal tax debt. The IRS can either accept or reject the offer. If the IRS accepts the Offer in Compromise and the taxpayer meets all of the requirements, the tax outlined in the OIC will be considered settled.

Currently the IRS accepts approximately 20% of first time OIC offers but more may be accepted after negotiations or on appeal. New Hampshire taxpayers whose OIC is denied will not have any legal authority to pursue legal action against the IRS. The IRS has the sole authority to accept or deny all OIC offers.

Offer in Compromise, if accepted, will stop all IRS collection actions against the taxpayer and stop penalties and interest from accruing. Offer in Compromise can be difficult and time consuming. The IRS will need detailed financial information from the New Hampshire taxpayer. If the OIC is denied, this information can be used by the IRS to continue their debt collection efforts. New Hampshire taxpayers who are considering Offer in Compromise should contact a tax professional to determine if OIC is the best option for them to settle their IRS tax debt.

Qualifying for Offer in Compromise

The IRS will not accept all OIC offers. To qualify for an Offer in Compromise, New Hampshire taxpayers must meet one of the following conditions:

• Doubt as to Liability- If there is some question about the amount of tax liability which has been assessed against the taxpayer the IRS may accept an Offer in Compromise. Doubt as to liability can occur if the IRS administrator misapplied the tax laws, made an error in calculation or if the taxpayer has produced additional tax information. This condition is not frequently met.
• Doubt as to Collectibility- Under this condition the amount of tax debt is not in question only the ability of the IRS to collect the debt before the statutory period ends for collection. The IRS also may accept an OIC under this condition if they believe the cost to collect the tax debt may be too high.
• Effective Tax Administration- The IRS may accept an OIC if they believe New Hampshire taxpayers who pay their federal tax debt may experience a hardship which is inequitable or unfair. The elderly and handicapped frequently qualify under this condition.

New Hampshire taxpayers must also complete the following:

• New Hampshire taxpayers must pay their federal taxes before the federal tax deadline for the next 5 years.
• New Hampshire taxpayers must meet all of the agreed upon requirements outlined in the OIC.
• New Hampshire taxpayers must submit their federal tax returns on or before the federal tax deadline.

Installment Agreement

Installment agreements are the most popular tax settlement option used by taxpayers. The installment agreement allows New Hampshire taxpayers to pay all of their tax debt in monthly installment payments. The time allowed to pay the IRS tax debt will vary based on the amount of debt the taxpayer owes.

New Hampshire taxpayers who owe $25,000 or less can either contact a tax professional or the IRS directly to discuss their payment options. Taxpayers who owe more than $25,000 should contact a tax professional who can help them negotiate the installment agreement. Penalties and interest will continue to accrue until the full amount of the tax debt is paid, but collection efforts will cease after the IRS accepts the installment agreement. It will always be less expensive for New Hampshire taxpayers to pay all of their tax debt in one lump sum payment and avoid an installment agreement if possible.

The Internal Revenue Service can terminate an Installment agreement for a variety of reasons including:

• The taxpayer fails to make the full installment agreement payment each month. First time violators may be granted a 30-60 day grace period.
• Federal tax returns are not submitted each year by the federal tax deadline.
• A New Hampshire taxpayer’s financial condition substantially improves.
• The taxpayer provides false or incorrect information to the IRS on the installment agreement application.
• Self-employed New Hampshire taxpayers fail to submit their federal tax returns each quarter or fail to make their estimated tax payments.
• Taxpayers fail to pay all of their IRS tax payments for the 5 years before the Internal Revenue Service tax debt which can not be paid.
• Taxpayers have had another installment agreement within the last five years.

Partial Payment Installment Agreement

New Hampshire taxpayers who do not meet the requirements of OIC or who can not make the monthly payments for the installment agreement may be able to qualify for a partial payment installment agreement (PPIA). PPIA allows taxpayers to pay only part of the tax debt in partial monthly installment payments. The IRS will forgive the tax debt which is not outlined in the PPIA.

Interest and penalties will continue to accrue until all the tax debt is paid under the PPIA, but the IRS will stop their debt collection efforts against New Hampshire taxpayers. Every two years the IRS will review the financial condition of the New Hampshire taxpayer to determine if their finances have substantially improved. If they have, the IRS has the authority to increase the PPIA tax payments amount or to cancel the PPIA.

Currently Not Collectible

If the IRS determines a New Hampshire taxpayer can not pay their IRS tax debt either through an installment agreement or another IRS tax settlement option, they may change the tax status to currently not collectible.

If the IRS determines a taxpayer’s debt is currently not collectible they will cease all collection actions against the taxpayer. Penalties and interest will continue to accumulate on all outstanding tax debt. The IRS will send a letter to the New Hampshire taxpayer each year outlining the amount of outstanding tax debt. This letter is not considered a tax bill. The IRS has 10 years to collect the debt or the statute of limitations will expire and the debt will be forgiven.

Penalty Abatement

The IRS will charge New Hampshire taxpayers penalties for a variety of tax violations including: filing a late tax return, failing to file a return, submitting false tax information or requesting a false refund. There may be valid reasons for violating a tax law and if the New Hampshire taxpayer can prove they have a valid reason, the IRS may be willing to abate or lower their tax penalties. New Hampshire taxpayers who have had penalties assessed against them can contact a tax professional such as an enrolled agent, tax attorney or certified public accountant for help.

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Kentucky taxpayers who want to settle IRS tax debt may be able to use an IRS tax settlement option. The United States federal government has given the Internal Revenue Service (IRS) the legal authority to collect federal taxes for a fraction of the full amount owed.

Kentucky taxpayers who fail to pay IRS tax debt may face wage garnishments, repossessions or bank account levies. IRS tax settlement options may allow a taxpayer to repay their debt and avoid debt collection. The Internal Revenue Service may be willing to negotiate with a Kentucky taxpayer to avoid declaring debt currently not collectible or agreeing to a protracted installment agreement.

Kentucky taxpayers who need information about IRS tax settlement options can contact a tax professional such as an enrolled agent, certified public accountant or tax attorney.

Offer in Compromise

Offer in Compromise is one type of IRS tax settlement option available for Kentucky taxpayers. Kentucky taxpayers can make an “offer” to the Internal Revenue Service to settle their IRS tax debt. If the Internal Revenue Service agrees to the compromise amount and all of the requirements of the Offer in Compromise are met, the federal tax debt will be considered settled. Under certain conditions, the Internal Revenue Service may be willing to accept less than the total amount of federal tax owed.

Approximately 80% of first time Offer in Compromises are declined by the Internal Revenue Service. The IRS may be willing to continue negotiations with Kentucky taxpayers to find an amount which is agreeable to the federal government and the taxpayer. Offer in Compromise can be time consuming, expensive and complicated. The IRS will request a substantial amount of financial data to process the Offer in Compromise agreement and if the OIC is denied, the Internal Revenue Service can use this information to continue their debt collection efforts.

Qualifying for Offer in Compromise

Not all Kentucky taxpayers with IRS tax debt will be able to qualify for an Offer in Compromise. Offer in Compromise may be accepted by the Internal Revenue Service for the following reasons:

• Doubt as to Liability- Kentucky residents may have questions about the amount of tax liability they have been assessed. If the IRS agrees, they may be willing to grant an Offer in Compromise. This condition is not frequently met.
• Doubt as to Collectibility- The Internal Revenue Service may accept an Offer in Compromise if they believe they will not be able to collect federal tax debt. This is not the same as the first condition in that the amount of tax debt owed is not in question, only the ability of the IRS to collect the tax debt.
• Effective Tax Administration- Kentucky taxpayers who believe they will experience “an economic hardship which is unfair and inequitable” if they pay their IRS tax debt may qualify for an Offer in Compromise. This condition is most frequently met for the elderly and the handicapped.

Kentucky taxpayers applying for an OIC must also complete the following:

• Kentucky taxpayers will have to pay all of their future IRS tax debt on or before the federal tax deadline for the next 5 years.
• All the Offer in Compromise requirements must be completed by the Kentucky taxpayer.
• Kentucky taxpayers must fill out and complete all of their Internal Revenue Service tax returns by the federal tax deadline.

Installment Agreement

The most popular method used by taxpayers to settle IRS tax debt is the installment agreement. With an Installment Agreement or IA the IRS can make monthly installment payments to repay federal tax debt. Kentucky taxpayers with tax debt of $25,000 or less can generally get an installment agreement and repay their debt over 60 months. Kentucky taxpayers who owe more than $25,000 should talk to a tax professional that has the expertise to negotiate the best installment agreement possible. Penalties and interest will accrue for the entire duration of the installment agreement. Paying all federal tax debt in one lump sum is always less expensive than an installment agreement.

The Internal Revenue Service can revoke an installment agreement for any of the following reasons:

• If the Kentucky taxpayer fails to pay the monthly tax payments or file tax returns.
• If the Kentucky taxpayer pays less than the agreed upon monthly payment amount.  First time violators may be granted a 30-60 day grace period.
• If a Kentucky taxpayer’s financial condition improves.
• If a Kentucky taxpayer provides false or inaccurate tax information to the IRS during the installment agreement application process.

Kentucky taxpayers who are considering an installment agreement must meet the following requirements:

• All self-employed Kentucky taxpayers must file quarterly IRS tax returns and make quarterly estimated federal tax payments.
• Kentucky taxpayers must submit all federal tax returns.
• Kentucky taxpayers must pay their IRS tax debt for the 5 years before the tax liability which can not be paid.
• Kentucky taxpayers can not have made another installment agreement with the Internal Revenue Service with in the last 5 years.
• The IRS will perform a review of the Kentucky taxpayer’s financial situation every two years.

Partial Payment Installment Agreement

Kentucky taxpayers who do not qualify for an Offer in Compromise or who can not pay their full amount of tax debt may be able use a partial payment installment agreement or PPIA. Partial payment installment agreements differ from an installment agreement by allowing the Kentucky taxpayer to repay their tax debt with partial monthly payments. Any debt which is not paid will be forgiven by the IRS.

Partial payment installment agreements can be less complicated, less expensive and less time consuming that an OIC agreement. Penalties and interest will continue to accrue during the PPIA period, but the IRS will stop their collection actions such as wage garnishments and bank account levies. The partial payment installment agreement will be reviewed by the Internal Revenue Service every two years and if the Kentucky taxpayer’s financial situation improves the PPIA payments may be increased or the plan may be terminated. It is always more cost effective to pay all IRS tax debt with one lump sum payment.

Currently Not Collectible

Tax debt not paid by the Kentucky taxpayer may be determined “currently not collectible”. Currently not collectible will stop all Internal Revenue Service collection tactics such as tax levies and wage garnishments. Notice will be sent each year to the Kentucky taxpayer outlining tax debt owed. This notice is not considered a tax bill. The expiration for the Internal Revenue Service to try and collect the tax debt is ten years.

Penalty Abatement

The Internal Revenue Service may assess the Kentucky taxpayer penalties for a variety of tax infractions including but not limited to: failure to file a federal tax return, requesting a false refund or reporting inaccurate tax data. The Internal Revenue Service may be willing to abate or reduce a tax penalty if the Kentucky taxpayer can provide a valid reason for the abatement. Valid reasons may include: personal duress, environmental disasters, inaccurate tax professional filings or failing physical health. The Internal Revenue Service may not be willing to dismiss or lower all penalties.

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