Fresh Start Initiative

Are you having trouble paying off your tax debt? The Fresh Start Initiative may help you get relief.

The Fresh Start Initiative is one of the more recent programs the IRS has implemented to help taxpayers who are struggling with tax debt. Through a series of changes to IRS policies, the Fresh Start Initiative offers expanded relief to taxpayers that are experiencing financial hardship and difficulty resolving their tax debt.

Commonly Asked Questions About the Fresh Start Initiative

What is the IRS Fresh Start Initiative?

The Fresh Start program is an IRS initiative that’s designed to help taxpayers who are struggling to pay back taxes. The program offers relief and exemptions to qualifying taxpayers as a way of helping them get back on their feet financially.

How Long Has the Fresh Start Initiative Been Around?

The Fresh Start Initiative began in 2008, then underwent some modifications in 2012 to better help taxpayers resolve their debt.

Who Qualifies for the Fresh Start Initiative?

Both individuals and small businesses may qualify for the Fresh Start Initiative, though there are rules about which individuals and businesses qualify. Tax issues like bankruptcies, future income concerns, current tax liens, and defaulted installment agreements can affect Fresh Start eligibility.

There are also some limitations on who can receive Fresh Start relief. For example, to use the Fresh Start Initiative, a taxpayers debt balance must be below $50,000 at the end of the year. Additionally, taxpayers must make $100,000 or less per year for individuals or $200,000 per year for couples filing jointly to qualify for Fresh Start relief.

There are many variables that the IRS will assess for Fresh Start program qualification; they make their qualification decision on a case-by- case basis. To help you take advantage of the Fresh Start Initiative, it’s a good idea to consult a tax professional who can help you determine if you qualify and present your case to the IRS in the best possible light.

How Does the Fresh Start Initiative Affect Installment Agreements?

The Fresh Start Agreement has made it possible for more taxpayers to use streamlined installment agreements. The provisions of the agreement raised the threshold for using an installment agreement from $25,000 to $50,000. The provisions also expanded the maximum timeframe for installment agreements, which is now 72 months rather than 60 months.

Installment agreements are an excellent tool to use to help settle tax debt, so the expansion of the installment agreements made by the Fresh Start Agreement can help many more taxpayers get relief from debt.

How Does the Fresh Start Initiative Affect Tax Liens?

The Fresh Start Agreement has raised the tax debt threshold for filing a Notice of Federal Tax Lien from $5,000 to $10,000. It also made changes on tax lien withdrawal policies. Now those seeking to have a lien withdrawn have three ways to do so: by paying off their lien in full or by reaching the statute of limitations for the lien, by making three direct debit payments on direct debit installment agreement for an amount of $25,000 or less, or by making three successful payments on a regular installment agreement. These lien withdrawal qualifiers may sometimes trigger automatic lien release, but taxpayers may also need to request a lien withdrawal.

How Does the Fresh Start Initiative Affect Offers In Compromise?

The Fresh Start Initiative streamlined the Offer in Compromise program and allowed it to cover a larger group of struggling taxpayers. However, an Offer in Compromise is still based on a taxpayer’s unique circumstances. The IRS individually assesses taxpayers for OIC eligibility and IRS one time forgiveness, and will not accept offers from those who the IRS determines can pay off their debt through installment agreements or in full with a lump sum.

How Long Does Using the Fresh Start Initiative Take?

All tax debt cases are unique, so the amount of time it takes to resolve tax debt will vary per each individual’s financial situation. On average, the Fresh Start Initiative tax debt resolution process takes a few months, though it can take up to a year under certain circumstances. Because the Fresh Start process takes some time, it’s best to start it as soon as possible to get the fastest relief.

Can the IRS Reopen My Debt After or During a Fresh Start?

As with any other tax resolution process, the IRS retains the right to reassess or reopen any tax debt, even a after settlement has been paid. Common reasons the IRS has for reopening or reassessing Fresh Start settlements include failure to make payments on time, failing to pay in full by the end of the payment plan period, and failure to comply with changes to IRS programs.

Tax law is complicated and ever-changing, so sometimes taxpayers may fail to fully understand the terms of their agreement or be unaware of changes in the law that affect their agreement. That’s why, for those who feel they don’t fully understand their tax obligations, seeking the help of a tax professional may be the best way to make sure your Fresh Start remains settled.

Get Help With The Fresh Start Initiative

The Fresh Start Initiative can be a huge relief for those struggling to pay their taxes. But, because tax law is complicated and ever-changing, many people don’t know that they qualify for the Fresh Start Initiative, or they may not understand how it applies to them.

If you’re struggling with tax debt, reach out to a tax expert at Vanguard Tax Relief by calling us at (866)900-6060 for a free consultation. Our tax experts are fully trained at applying Fresh Start Initiative policies to our clients’ cases, and will fight to make sure you’re able to take full advantage of every form of tax relief you’re qualified to receive. Don’t wait— contact us today and start getting relief from your tax debt.

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