A taxpayer who owes a federal tax has several options to choose, depending on the taxpayer's circumstances. This article describes the different payment methods approved by the IRS, which apply to Nevada residents as well as those living in other states. If the taxpayer is ready to pay, the IRS recommends that the taxpayer use the free IRS Direct Pay service online. This will take the funds directly from one's checking or savings account.
Some people in Nevada who owe federal taxes may find themselves being audited, which can be an overwhelming and unpleasant experience. Although those individuals who receive letters about Internal Revenue Service audits can challenge this process, this can be an intimidating notion. A tax attorney can help them to respond to the IRS and address the problems before they become even bigger concerns.
The tax laws pertaining to Nevada and all other states permit the IRS to accept less than the amount of back taxes due in order to compromise and settle and outstanding claims against taxpayers who truly cannot afford the amount due. The practice of using offers in compromise is generally understandable in light of the fact that a substantial amount of back tax bills are made up of late fees, interest and penalties. When one suffers true hardship, the government will do better by receiving what the person can afford rather than continuing futile collection efforts for what is essentially an impossible debt for the taxpayer to satisfy.
The IRS now faces a movement in the U.S. Congress to turn over a large part of its collection activities to private collection agencies. Supporters suggest that private collectors will bring in an additional 2.38 billion over the next 10 years. Opponents point to prior ventures with private collectors that did not work. This movement comes on the heels of one of the worst tax filing seasons for the IRS, where the agency allegedly hung up on millions of callers nationwide, including here in Nevada, because it didn't have the resources to handle the calls.