Question 1

How much can the IRS Fresh Start Program reduce my tax debt?

Accepted Answer

The reduction depends on your financial situation and which program you qualify for. Offers in Compromise can reduce debt by 90% or more—we've settled $50,000 debts for $5,000 lump sum payments. Penalty Abatement typically removes 25-40% of your total balance by eliminating failure-to-file and failure-to-pay penalties. Currently Not Collectible status doesn't reduce the debt but stops all collection activity indefinitely. If your income stays low enough for several years, the debt expires under the 10-year statute of limitations. Installment Agreements don't reduce the principal but stop penalties and interest from growing, making the debt manageable over time. Your specific reduction depends on your income, expenses, assets, and tax history. During our free consultation, we calculate your potential savings under each program and recommend the best path forward.

Question 2

What qualifies someone for the IRS Fresh Start Program?

Accepted Answer

You qualify if you owe back taxes and meet specific program requirements. For Offers in Compromise, the IRS must believe they'll never collect the full amount based on your income, expenses, and assets. Most qualifying taxpayers earn less than $100,000 annually and have minimal assets beyond basic living needs. Installment Agreements are available if you owe $50,000 or less and can pay within six years. Currently Not Collectible status requires proving that paying any amount would create financial hardship—your necessary living expenses exceed your income. Penalty Abatement works if you have reasonable cause for late filing or payment. The key is proper documentation. We gather your financial records, prepare the required forms, and present your case in the strongest possible light. Many taxpayers qualify for multiple programs, and we structure combinations that maximize your savings while ensuring IRS approval.

Question 3

How long does the Fresh Start Program application process take?

Accepted Answer

Timeline varies by program type and case complexity. Installment Agreements typically process within 30-60 days once we submit complete financial documentation. The IRS often approves streamlined agreements for amounts under $50,000 within weeks if your paperwork is accurate. Offers in Compromise take longer—usually 6-12 months for full processing. The IRS requires extensive financial disclosure and investigates your ability to pay. We handle all correspondence and requests for additional information during this period, keeping your case moving forward efficiently. Currently Not Collectible status can be granted within 30-45 days with proper hardship documentation. Penalty Abatement requests typically resolve in 60-90 days depending on the reasons for late filing or payment. Throughout the process, collection activity stops once we formally represent you, giving immediate relief while your case processes.

Question 4

Will applying for Fresh Start Program stop IRS collection actions immediately?

Accepted Answer

Yes, once we submit your application with proper representation paperwork, most collection activities pause. The IRS cannot levy your wages, bank accounts, or other assets while your Offer in Compromise or Currently Not Collectible request is under review. This protection continues throughout the entire application process. Installment Agreement requests also trigger collection holds in most cases. If you're current on filing requirements and provide complete financial information, the IRS typically stops enforcement actions while reviewing your payment proposal. Emergency situations like imminent bank levies get priority handling to prevent asset seizure. However, the IRS can still file new tax liens during the application process, and existing liens remain until your case resolves favorably. We monitor your account continuously and address any collection issues that arise, ensuring you stay protected while pursuing the best possible resolution for your specific situation.

Question 5

Can I apply for the Fresh Start Program if I haven't filed all my tax returns?

Accepted Answer

You must file all required returns before the IRS approves any Fresh Start Program application. This is non-negotiable—missing returns disqualify you from all relief programs until you become compliant. We handle the preparation and filing of back returns as part of our comprehensive service. Filing missing returns often reveals refunds that offset some of your tax debt. We've seen clients reduce their overall balance by thousands after filing previously unfiled returns with legitimate deductions and credits they missed. The IRS also stops assessing estimated taxes once actual returns are filed, preventing your debt from growing larger. We prepare all missing returns simultaneously and file them strategically to minimize your total tax liability. This includes claiming all available deductions, credits, and loss carryforwards that reduce your taxable income. Once all returns are filed and processed, we immediately submit your Fresh Start Program application to begin resolving your remaining tax debt through the most advantageous program available.

Question 6

What happens if the IRS rejects my Fresh Start Program application?

Accepted Answer

Rejection doesn't end your options—it means we need to adjust our approach. Most rejections occur due to incomplete financial documentation or applying for the wrong program based on your circumstances. We analyze the rejection letter, address the IRS concerns, and resubmit with stronger supporting evidence. For Offer in Compromise rejections, we often appeal the decision or modify the offer amount based on IRS feedback. Sometimes the rejection reveals information that qualifies you for a different program with better terms. Currently Not Collectible rejections usually mean we need additional hardship documentation or expense verification. If all Fresh Start options are exhausted, we explore alternative strategies like partial payment installment agreements, bankruptcy considerations, or negotiating direct payment plans outside the formal programs. Our goal remains the same—finding a resolution that stops collection actions and fits your financial reality. We don't give up until your tax problem is solved.

IRS Fresh Start Program Dundaff, PA