COVID-19 is affecting millions of Americans in all aspects of their life. As of the beginning of May, 1 million Americans tested positive for the disease.
A much more striking number is the number of people whose finances have been shred to pieces with the prolonged shut down and “stay-at-home” orders.
In just the first 6 weeks of the pandemic, 30 million people filed for unemployment, with that number continuing to climb. We’re now almost certainly in the midst of the most difficult financial crisis we’ve seen in the last 100 years.
As an expert tax resolution firm, our job is to help restore the taxpayers financial life when they find themselves in tax trouble, often because of a difficult financial situation.
In this article, we follow up with a quick update on the current state of affairs in regards to your taxes. We’ll walk you through what you need to know about taxes and the COVID-19 pandemic, including tax relief options you can take advantage of.
Note; If you were negatively affected financially by the COVID-19 pandemic and you find yourself behind on your taxes, contact us for a free, no-obligation, confidential consultation.
The Treasury Department and the Internal Revenue Service released state-by-state figures for Economic Impact Payments, with 89.5 million individuals receiving payments worth nearly $160 billion in the program’s first three weeks.
As of April 17, the IRS issued 89.5 million payments to taxpayers across the nation. More payments are continuing to be delivered each week.
More than 150 million payments will be sent out, and millions of people who do not typically file a tax return are eligible to receive these payments. Payments are automatic for people who filed a tax return in 2018 or 2019, receive Social Security retirement, survivor or disability benefits (SSDI), Railroad Retirement benefits, as well as Supplemental Security Income (SSI) and Veterans Affairs beneficiaries who didn’t file a tax return in the last two years.
Source: IRS News Release Here
OWE BACK TAXES? IRS PUTS HOLD ON CERTAIN COLLECTION PROCESSES DURING COVID-19 TAX RELIEF
People who were already in debt and behind on their taxes are finding it really difficult to keep up with the day to day expenses, let alone cover past bills.
Late March, the IRS announced it’s People First Initiative.
“The new IRS People First Initiative provides immediate relief to help people facing uncertainty over taxes,” Rettig added “We are temporarily adjusting our processes to help people and businesses during these uncertain times. We are facing this together, and we want to be part of the solution to improve the lives of all people in our country.”
These new changes include issues ranging from postponing certain payments related to Installment Agreements and Offers in Compromise to collection and limiting certain enforcement actions. The IRS will be temporarily modifying many of its collection activities and the effort will initially run through July 15. During this period, to the maximum extent possible, the IRS will avoid in-person contacts. However, the IRS will continue to take steps where necessary to protect all applicable statutes of limitations.
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IMPORTANT: It’s highly recommended that you are proactive about resolving your tax problems. The IRS is likely to be more lenient and understanding of taxpayers during this time so you might have options and access to programs you might not have had before. Please reach out to our firm for a consultation.
FILING AND PAYING YOUR TAXES
The IRS announced they’d be extending the filing deadline for the 2019 tax year. The new deadline is now July 15th and the IRS won’t be tacking on penalties or interest, regardless of how much taxes you owe.
This gives you a bit more time to gather your documents, search for new deductions, and file and pay your taxes.
YOUR CHANCES ARE GOING UP TO SETTLE WITH THE IRS
The IRS has a program that allows you to settle your tax debt for less than you owe IF you meet certain criteria. This program has existed before and is called Offers in Compromise (OIC).
Though it’s not a new program, if your financial situation changed due to COVID-19, you might now qualify to settle with the IRS. Our firm can help guide you and see if you would qualify.
The IRS reminds people facing a liability exceeding their net worth that the OIC process is designed to resolve outstanding tax liabilities by providing a “Fresh Start.”
What To Do Next?
There are other tax relief options that the IRS has under normal circumstances, and with coronavirus news changing literally every day during the pandemic, it’s important to have the best tax resolution firm in your corner so you can get through these challenging times.
Remember, you’re not alone and you have options. More than 13 million Americans had already found themselves in tax trouble before the pandemic started, and many millions more will find themselves behind on their taxes.
Our firm specializes in tax resolution and our experts help during this COVID-19 pandemic. We also serve clients virtually so don’t hesitate to reach out. If you want an expert tax resolution specialist who knows how to navigate the IRS maze, reach out to our firm and we’ll schedule a no-obligation confidential consultation to explain your options to permanently resolve your tax problem.