The IRS has three months from your submission date (including extensions) to inform you of outstanding taxes and ten years after your initial notification to retrieve all taxes due. According to Raanan, the 10-year period begins on the day the tax was "assessed," or recorded. However, "the statute date can be prolonged owing to conduct on an account," including bankruptcy, appeal, delivering an offer in compromise, and other similar actions. When a tax debt is not paid for long, the Internal Revenue Service may take enforcement procedures to collect the money owed. These actions include bank levies and tax liens.

Methods to Pay Your Taxes

There are alternatives to immediately paying the whole amount of your tax bill. Tax Act's vice chairman of tax operations, Mark Jaeger, suggests credit card payment if taxpayers are confident they can pay it off during the 30-day grace period. He explains, "The IRS does provide several sorts of installment arrangements," and he points out that the interest rate on these plans is roughly 4%, which is a lot better than even a credit card bill of 18% to 25% percent.

Get on an installment plan.

You can apply to make installment payments on your tax bill. Interest will keep piling up while you delay.

Ask for a compromise offer.

Your tax debt can be settled for far less than the whole amount owed in this way. The process often includes applying.

Register, and pay how much you can.

Since the penalty for failing to file is greater than the penalty for failing to pay, it is better to complete your taxes and do what you can rather than risk the higher of the two penalties. Now is the time to negotiate a payment plan with the IRS or see a tax attorney about your choices.

Ask for a determination of hardship.

The IRS may lift a bank levy if doing so would relieve undue financial strain.

Conclusion

When you initially learn that you face a tax payable, you must initiate the process of resolving it as soon as possible by following the appropriate steps. Taking action as quickly as possible is the single most critical step that taxpayers can take to lessen the danger of receiving correspondence from the Internal Revenue Service (IRS) and the fines and fees associated with such a letter. However, clients commonly say that the Internal Revenue Service (IRS) has sent them inaccurate letters, not answered their phone calls, and caused administrative delays in recent years. Because of this, it has become more challenging for citizens to appreciate and make their way through the agency's dealings with them.