Question 1

How do I know if I qualify for the IRS Fresh Start Program?

Accepted Answer

You may qualify if you owe $50,000 or less in combined taxes, penalties, and interest, are current on all required tax filings, and can demonstrate financial hardship or inability to pay the full amount without economic strain. Self-employed individuals may qualify if they show a 25% or more drop in income.The key is proving to the IRS that paying your tax debt in full would create genuine financial hardship. This requires detailed financial documentation including income statements, expense records, and asset valuations. We know exactly how to present this information to maximize your chances of approval.Even if you owe more than $50,000, you might still qualify by making a partial payment to reduce your balance below the threshold. The IRS evaluates each case individually, which is why professional representation makes such a difference in the outcome.

Question 2

What's the difference between an Offer in Compromise and installment agreement?

Accepted Answer

An Offer in Compromise lets you settle your tax debt for less than you owe—sometimes 90% less—if you can prove you'll never be able to pay the full amount. An installment agreement spreads your full tax debt over time with monthly payments, but you still pay everything you owe plus interest.Offers in Compromise are harder to qualify for but provide much greater savings. You need to demonstrate that your income and assets will never allow you to pay the full debt before the collection statute expires. The IRS looks at your reasonable collection potential—what they could realistically collect from you over time.Installment agreements are easier to obtain and stop collection actions immediately, but interest continues accruing on your balance. For many Middletown Center residents, the right choice depends on their long-term financial outlook and current ability to make monthly payments.

Question 3

How long does the Fresh Start Program application process take?

Accepted Answer

The timeline varies by program type, but most applications take 6-12 months for the IRS to review and approve. Installment agreements typically process faster—often within 30-60 days—while Offers in Compromise can take 6-24 months depending on complexity and IRS workload.During the application process, the IRS generally suspends collection activities, meaning no wage garnishments, bank levies, or property seizures. However, interest and penalties may continue accruing, so it's important to submit a complete, well-prepared application the first time.Our experience significantly speeds up the process because we know exactly what documentation the IRS requires and how to present your case for the fastest approval. We also maintain direct relationships with IRS agents, which helps move cases through the system more efficiently.

Question 4

Will the Fresh Start Program stop IRS collection actions immediately?

Accepted Answer

Yes, once you submit a properly prepared Fresh Start Program application, the IRS typically suspends most collection activities including wage garnishments, bank levies, and asset seizures. This protection continues while your application is under review.However, the IRS may still file new tax liens during the application period, and they won't remove existing liens until your case is fully resolved. Interest also continues accruing on your debt, though penalties may be suspended in some situations.The key is submitting a complete, accurate application that meets all IRS requirements. Incomplete applications get rejected quickly, leaving you vulnerable to resumed collection actions. Professional representation ensures your application is done right the first time, maximizing your protection period and approval chances.

Question 5

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

Accepted Answer

No, you must be current on all required tax filings before applying for any Fresh Start Program relief. The IRS views filing compliance as a prerequisite for any payment arrangement or debt reduction program.If you have unfiled returns, we can help you get caught up quickly and accurately. We'll prepare all missing returns, often uncovering deductions and credits that reduce your overall tax liability. Sometimes unfiled returns actually result in refunds that offset part of your debt.Once all returns are filed, you become eligible for Fresh Start relief options. The IRS prioritizes taxpayers who demonstrate good faith efforts to comply with their filing obligations, so getting current on returns actually strengthens your case for favorable treatment under the program.

Question 6

What happens if my Fresh Start Program application gets rejected?

Accepted Answer

If your application is rejected, you have appeal rights and can often resubmit with additional documentation or corrections. The IRS must provide specific reasons for rejection, which gives you a roadmap for addressing their concerns.Many rejections occur due to incomplete financial information, mathematical errors, or failure to meet technical requirements rather than actual ineligibility. Professional representation dramatically reduces rejection rates because experienced tax professionals know exactly what the IRS expects and how to present your case effectively.We've handled thousands of Fresh Start cases and know how to navigate the appeals process when necessary. We'll analyze the rejection reasons, gather additional supporting documentation, and resubmit your case with the strongest possible presentation to secure approval.

IRS Fresh Start Program Middletown Center, PA