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Tax Time 2020: IRS Providing Relief to Taxpayers

Tax Time 2020: IRS Providing Relief to Taxpayers
March 31, 2020 Prosperity Connection

IRS’s People First Initiative: Providing Relief to Taxpayers

Last week, the IRS released a sweeping series of steps that can help out taxpayers during this difficult time. Some of these steps have to do with postponing new audits and examinations and changes in how the IRS contacts individuals and businesses. The steps that are most relevant to individuals are in regards to people who haven’t filed their taxes in more than a year and those who owe money to the IRS. Here are some that stand out:

  • “For taxpayers under an existing Installment Agreement, payments due between April 1 and July 15, 2020 are suspended. Taxpayers who are currently unable to comply with the terms of an Installment Payment Agreement may suspend payments during this period if they prefer. The IRS will not default any Installment Agreements during this period. By law, interest will continue to accrue on any unpaid balances.”
  • People who are unable to fully pay their federal taxes can enter into a monthly payment agreement.
  • Offers in Compromise
    1. The IRS will allow taxpayers until July 15 to send in any requested information on pending Offers in Compromise and will not close any pending requests before July 15.
    2. Taxpayers have the option of suspending all payments on Offers in Compromise until July 15.
    3. The IRS will not default an Offer in Compromise for taxpayers who haven’t yet filed their 2018 tax return, but you should do it before July 15.
  • You should file any delinquent tax returns for years prior to 2019. According to the IRS, “more than 1 million households that haven’t filed tax returns during the last three years are actually owed refunds; they still have time to claim these refunds.” Don’t leave money on the table! File your tax return today! If you end up having to owe money, they’ll work with you on a payment plan so you can have a “Fresh Start.”

Read more about the People First measures here: https://www.irs.gov/newsroom/irs-unveils-new-people-first-initiative-covid-19-effort-temporarily-adjusts-suspends-key-compliance-program

Resources:

IRS.gov; CFPB.gov; FTC.gov