How to Get Help With Back Taxes

IRS programs for back taxes

There are several IRS programs available to help you manage back taxes, all of which you can handle online.

Offer in compromise

If you can’t pay off your total tax debt, an offer in compromise lets you settle your tax debt for less than you owe if you can’t pay the full amount or if doing so would create a financial hardship. With an OIC, you can choose to pay off your debt in a single lump sum or create a payment plan. Generally, the following need to be true to qualify for an OIC:

• You’ve filed all required tax returns and made all required estimated payments.
• You aren't in an open bankruptcy proceeding.
• You have a valid extension for a current year return (if applying for the current year).
• You are an employer and have made tax deposits for the current and past two quarters before you apply.

You can also use the IRS offer in compromise prequalifier tool to see if you’re eligible.

Delayed collection

Delayed collection, also known as currently not collectible status, can let you temporarily delay the IRS from collecting your tax debt and stop wage garnishment while you’re experiencing a financial hardship.

To file a delayed collection request, you’ll need to fill out a Collection Information Statement and submit proof of your financial status, including your monthly income, expenses and a list of your assets and liabilities.

Penalty abatement

You may qualify for penalty abatement if you have a valid reason and meet the following requirements:

• You didn’t have any IRS penalties for three years before receiving the current IRS penalty.
• You filed an extension request or have paid (or plan to pay) the amount due.
• You already paid the penalty before requesting penalty abatement.

Payment plan

If you need to spread out your back tax payments over time, you can apply for a short-term or long-term payment plan. Note that repayment plans don’t stop the IRS from assessing penalties and interest until your tax debt is repaid.

Short-term repayment plan

To qualify for a short-term repayment plan, you must owe less than $100,000 in combined tax, penalties and interest. Short-term plans are 180 days or less. There’s no fee for setting up a short-term payment plan.

Long-term repayment plan

IRS long-term repayment plans may also be referred to as simple payment plans or installment agreements. To qualify for a long-term repayment plan, you must owe less than $50,000 in combined tax, penalties and interest, and you must have filed all required returns before applying. If you owe back business taxes, you can apply for a long-term repayment plan if you owe $25,000 or less.

A $29 online setup fee applies for long-term plans with automatic payments set up and a $69 online setup fee applies for long-term plans with monthly payments that aren’t automated. Low-income taxpayers may qualify for a fee waiver.

» READ MORE: How far back can the IRS collect?

What to do if you owe back taxes

If you owe back taxes, you may be able to handle the process on your own through the IRS website. Taking the right first steps can help you avoid additional penalties and regain control of the situation. Before applying for relief programs or hiring professional help, focus on getting organized and understanding where you stand with the IRS.

1. Log in to an IRS online account

Create or log in to your IRS online account to view your balance, payment history, tax records and any notices or letters. This tool can help you confirm the amount owed and monitor your account in real time.

2. Review IRS notices

Carefully read any IRS notices or letters you’ve received. You may have paper notices or letters, or you can view these documents in your online account. These documents explain how much you owe, deadlines for responding and any penalties or interest that have been added.

Don’t ignore IRS notices or letters. Ignoring IRS correspondence can lead to more serious collection actions, such as wage garnishment or liens. Even if you can’t pay right away, responding promptly shows good faith and may keep the situation from escalating.

3. File missing returns

File any missing tax returns through your IRS account. The IRS generally won’t approve any tax relief options until all required returns are filed. Filing also helps you determine the exact amount you owe.

4. Evaluate payment options

Once you understand how much you owe, evaluate your payment options. You may qualify for a short-term extension, long-term payment plan or other relief program based on your financial situation.

Free IRS programs for tax help

The IRS has several programs to help certain types of people get free or low-cost assistance with filing tax returns or resolving tax debts.

• The Volunteer Income Tax Assistance (VITA) program offers free tax preparation help for people who make $69,000 or less, people with disabilities or people who speak limited English.
• The Tax Counseling for the Elderly (TCE) program can help people who are 60 years old or older get free tax preparation help.
• The Low Income Taxpayer Clinic (LITC) program can help low-income individuals resolve certain tax debts (usually less than $50,000) with the IRS for free or at a low cost.

Should you hire a tax attorney or tax relief company?

If you don’t want to pursue the IRS’s tax relief options on your own, you may want to hire a tax attorney or a tax relief company to help you with filing your back taxes. Hiring a professional can help you negotiate with the IRS, lower the amount you owe and stop your wages from being garnished or your property from being seized by the IRS.

Tax attorney

Tax attorneys, certified public accountants (CPAs) and enrolled agents are licensed professionals who can find out which tax relief options you qualify for, help you fill out required forms and even represent you before the IRS during an audit.

It’s usually best to hire a licensed tax professional if you owe a large amount of tax debt that you can’t pay back immediately. A tax firm may also potentially save you money. However, most firms that specialize in tax relief are expensive, and the results are not guaranteed.

Tax attorney fees

Tax attorney fees vary based on the complexity of your case and the attorney’s experience. Some charge hourly rates of around a few hundred dollars per hour, while others may offer flat fees for specific services. Complex cases involving large debts or audits can cost several thousand dollars or more.

Tax relief companies

A tax relief company can help you fill out IRS forms and negotiate payments. Tax relief companies can serve as intermediaries between you and the IRS. They can help you navigate the complexities of filling out IRS documents such as an offer in compromise or a penalty abatement request.

It’s important to choose a tax relief company that is reputable and has gotten results for their clients. Some tax relief companies charge high fees and don’t actually help you much with the IRS.

Avoid tax relief scams

Avoid tax relief scams by avoiding companies that:

• Promise instant debt relief
• Guarantee specific results or savings
• Demand full payment upfront before work begins
• Pressure you to sign a contract immediately

Tax relief company fees

Tax relief companies typically charge around $250 to $1,000 for simple tax relief solutions, but they can charge up to $10,000 or more for a complicated OIC case. Some tax relief companies also charge a monthly retainer while working on negotiating your back taxes.

Which tax relief option is best for you?

Consider the following solutions, depending on how much you owe:

• If you owe $10,000 or less: Consider setting up an IRS payment plan online yourself. This is often the fastest and cheapest option if your finances are straightforward.
• If you lost your job or can’t afford payments right now: You may qualify for delayed collection or currently not collectible status to pause IRS enforcement while you recover financially.
• If you owe $50,000 or more: A tax professional may help you negotiate a lower settlement through an offer in compromise or structure a manageable repayment plan.
• If you made a mistake or missed filings: Start by filing your returns yourself, then decide if you need professional help based on complexity.
• If you’re facing wage garnishment or legal action: Contact the IRS immediately and consider hiring a tax attorney or enrolled agent to represent you.

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How long does it take to get help with back taxes?

How long it takes to get help with back taxes depends on whether you handle it yourself or hire a professional, how quickly you submit required documents and the complexity of your case.

Respond promptly to IRS notices and submit accurate paperwork to reduce delays.

Some tax solutions can be set up within days, while others may take months for the IRS to review and approve.

• Offer in compromise: Typically a few months
• Currently not collectible status: Typically a few weeks to a few months
• Penalty abatement: Varies
• Payment plans: Typically a few days to several weeks

Hiring a tax attorney, CPA or tax relief company can speed up organization and communication, but the overall timeline still depends on IRS processing times.

What happens if you ignore back taxes?

If you ignore back taxes, the IRS can file a federal tax lien, garnish wages, levy bank accounts, seize property or even send you to jail. The IRS has broad authority to collect unpaid tax debt, and penalties and interest will continue to grow until the balance is paid.

The IRS will issue a Notice of Intent to Levy (CP504) before taking any action. If you don’t address the notice, the situation can escalate quickly.

• Federal tax liens: The IRS may file a federal tax lien, which is a public record that claims your property as security for the debt. A lien can damage your credit and make it harder to sell or refinance assets.
• Levies: A levy allows the IRS to legally seize property to satisfy your tax debt. This can include personal property, business assets or other valuables.
• Wage garnishment: The IRS can garnish your wages, which means a portion of your paycheck is sent directly to the government until the debt is paid.
• Bank account seizure: The IRS may freeze and seize funds directly from your bank account after providing notice. Once funds are removed, they are applied to your outstanding balance.

Penalties that may apply

If you fail to pay your taxes, the following penalties may apply, depending on your situation:

• Failure to pay penalty: This penalty is 0.5% (maximum 25%) of the unpaid taxes for each month the tax remains unpaid.
• Interest: Interest generally accumulates daily until tax debts are paid in full.
• Unreported taxes: If you attempt to defraud the IRS or evade paying taxes, you may be charged up to $100,000 in penalties ($500,000 for a corporation) and spend up to five years in prison.

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