Owing money to the treasury can be nerve wracking. The Internal Revenue Service (IRS) wields enormous power to collect its debts and has the legal authority to freeze assets and seize property. In extreme cases, it can subject taxpayers to arrest and imprisonment. With so much riding on getting everything right, it would be wise to avoid navigating the perils of the IRS bureaucracy alone.

The IRS routinely enters into installment agreements with taxpayers for back taxes. To qualify for an installment agreement, you must be up to date with federal tax filings and payments in the current year. The IRS can impose interest and penalties on the outstanding debt. These costs can be rolled into the periodic payments over the life of the plan. Installment plans often span a period of several years. In addition, defaulting on a payment plan can have serious legal and financial consequences for you.

If you are behind on taxes, you should engage a qualified tax attorney for guidance. Understanding the tax code and enforcement regulations takes a high level of legal expertise. Any proposed installment agreement must be both acceptable to the IRS and realistic for you, the taxpayer. Naturally, the IRS wants to get the funds into the treasury as soon as possible, but paying off the debt quickly is also in your best interests. Resolving the enforcement action can shield you from accrued interest and penalties.

The installment plan should not be so aggressive that it leaves no room for error. Missing payments to the IRS can trigger a default, while not paying other expenses in order to pay the IRS can also have significant personal consequences. A good tax attorney can craft a plan that is both acceptable to the IRS and achievable for you.

We here at Anker Law Group are proud to be one of South Dakota’s most respected law firms. Our Rapid City-based tax lawyers each have decades of experience in all aspects of federal income taxation. We are also admitted to practice before the U.S. Tax Courts in all relevant matters. If you or a family member has a tax situation, feel free to contact us online or call 605-519-5967 for an initial consultation.