FinMasters content is free. When you purchase through referral links on our site, we earn a commission. Advertiser Disclosure

If you owe the IRS money, you’re probably wondering what to do. The problem may seem insurmountable, and you may be tempted to try to avoid it. Don’t do that. The IRS will not go away or forget about you. Fortunately, you have options. One of those options is to hire a tax debt relief company.

That may not be your best option. If your tax debt is relatively small and your case is fairly simple, you may be able to deal with it yourself. The process of applying for an installment plan, for example, is fairly simple.

If you owe the IRS $10,000 or more, it’s serious. Before you run for the hills, know that there is a way out.  Hiring a tax debt relief company can take the pressure off.  If you want to make things a little easier, hiring an expert can help. They can talk to the IRS on your behalf, negotiate your tax liability, and even get a bank levy lifted.

If the IRS is sending you bills, here’s when to hire an expert to help with your tax debt. You’re here because you already know about the power of the IRS, their power to garnish wages or file a tax lien on your property, and it’s reached the point where you need to act.

You’re in the perfect place!

This article should help you make the right decision about your next step, whether it will be to attempt this on your own or choose to hire an expert to help.

Best Tax Relief Companies in 2022

Compare tax relief companies, pick the best option, and get help managing your tax debt.

View Companies

Reason 1: Your Tax Bill Is Past Due and You Can’t Pay

Do you owe $10,000? Or maybe you owe the IRS $16k or more?

Whatever your balance, getting slapped with a sizable tax bill is no walk in the park. If you don’t have the money to pay, how will you deal with the IRS?

You don’t have to face the music alone. Give yourself a break. 8% of all U.S. taxpayers are delinquent.  You are not alone! A tax debt relief company will know what options are available if you can’t pay your bill. 

If you give the IRS the cold shoulder, you’ll rack up an enormous amount of fees and penalties. The costs can range from 5% of your balance all the way up to 25% of your unpaid taxes. That means a balance of $10,000 can turn into $12,500 in no time at all.

If you don’t have the confidence or the skills to deal with the IRS yourself, hiring a tax debt relief company is a better move than trying to hide and hope the problem will go away.

Reason 2: You’re Curious About Tax Debt Forgiveness

You must be wondering why the IRS would charge fees on top of a tax bill you can’t pay.  Surely there must be a way to get out of paying tax debt you can’t afford! The truth is that the IRS can forgive some – or all – of the money you owe. They call it an “Offer in Compromise” (OIC), and it’s when you ask the IRS to settle for an amount that’s less than the amount you owe. 

An offer in compromise is not a sure thing. The IRS accepts only about 40% of the offers it receives. If they believe you can pay more than you’re offering, they will reject your offer. You need to get it right.

Offer in Compromise Mistakes:

Tax relief expert (and former IRS revenue officer) Jeffrey McNeal says when he processed offers, he saw tons of mistakes made on the forms, even when prepared by CPAs and enrolled agents!

A company that specializes in tax debt relief will know exactly what to include when submitting an OIC application. Hire a tax relief company, and they’ll do all the talking for you! The company will negotiate on your behalf, so you don’t have to feel the stress or spend precious hours on the phone with the IRS.

Reason 3: You Want a Payment Plan You Can Afford

But what if you’re like most people and don’t have cash lying around to pay off tax debt?

Well, there is a simple solution. Just ask the IRS to let you set up a monthly payment plan. It’s called an Installment Agreement, and you’ll use IRS Form 9465 to get started. The good news is that the IRS can give you up to 72 months to pay back tax debt. At this rate, your balance due of $16,000 would only require a payment of about $225.

Quick tip: Once you start an installment plan, you will have a harder time qualifying for a debt reduction request later.  We recommend you speak to an expert to see if you qualify for tax relief first.

But there is one problem. Payment plans can be very different. Your actual payment might be higher because of application fees and other costs assessed by the IRS.

An experienced tax debt relief company can help you get a payment plan you can afford. Make sure they take the time to explain your options so you understand your options.

Reason 4: You Have a Tax Lien Notice

You probably heard about tax liens or tax levies at some point, but you might not know what that means.

Let me walk you through the basics:

  • A tax lien is when the government makes a claim on your property, such as real estate or other assets you own.

  • A tax levy is what happens after the tax lien when the government takes your property away from you. The IRS can garnish your wages, seize assets, and freeze your bank accounts.

If you are facing a tax lien or a tax levy, you have a serious problem that you need to deal with immediately. If you have no idea how to do that, talking to a reputable tax debt relief company is a way to get started.

Reason 5: You Don’t Want to Deal with the IRS

Life is busy. I get it. Sometimes you don’t have the time (or energy!) to deal with things you know you should, like the IRS. You may even be intimidated, because – let’s face it – the IRS is intimidating.

And even if you could take care of tax debt on your own, it doesn’t mean you should. After all, tax law is complicated. If you don’t know what you’re doing, DIY tax debt relief can get you into trouble. Plus, it can eat up a lot of your time.  If you don’t have the skills, knowledge, or competence to deal with the IRS or you just don’t want to deal with the IRS, hiring a professional makes sense.

Instead of you going back and forth with the IRS, you simply leave it to the experts. They’ll negotiate on your behalf and explain things in a way that you can understand.

Benefits of Hiring a Tax Relief Company:

You might think the only benefit of using a tax relief company would be to help reduce a balance.  But after reading hundreds of reviews of tax relief companies, we’ve discovered that tax relief companies help Americans in a variety of ways:

  • provide guidance on audits
  • help set up payment agreements with the IRS
  • help get current on any unfilled tax returns 
  • some may be able to stop potential penalties such as wage garnishments

Most importantly, they pause the stress of dealing with the IRS – Typically any case submitted to the IRS takes months (or years) to review.  While waiting for their response, the IRS typically suspends any collection activities, and will often life wage garnishments, as is the case with an Offer in Compromise submission.

Our #1 choice for tax debt relief is Optima Tax Relief.  Click here to set up a free consultation.

Choose Carefully!

Hiring a tax debt relief company can be the right move to make. It’s certainly a better move than shoving those notices in a drawer and trying to forget about them.

Hiring the wrong tax debt relief company can still be a terrible mistake. There are lots of companies out there and not all are reputable. Some are outright scams. Never choose a tax debt relief partner on the basis of an advertisement. Do your research, review the options, and make an informed choice.

We’ve done some of the legwork for you in this review of the best tax debt relief companies. Check out several of them and you’ll have a better idea of the options available to you.

Remember that a tax debt relief company does not have magic tricks that can make your tax debt go away. The IRS makes the rules. A reputable tax debt relief company can help you navigate those rules and get the best deal. They can’t change the rules.

If a company promises that they can make your tax debt disappear, you’re being scammed. No reputable company will make that claim!

If the IRS sends you a letter claiming you owe taxes, it’s a perfectly acceptable reason to panic. When the panic passes, you need to act. You can go DIY or you can hire a tax debt relief company, but you need to assess your situation, make a decision, and carry it out. Don’t wait!