Question 1

Do I qualify for the IRS Fresh Start Program in Pennsylvania?

Accepted Answer

Most North Abington residents with tax debt qualify for some form of Fresh Start relief. The basic requirements are owing $50,000 or less in combined taxes, penalties, and interest, and being current with all required tax filings. However, qualification for specific programs within Fresh Start depends on your financial situation. For Offer in Compromise, you need to demonstrate financial hardship—that you can't pay the full amount without creating severe economic difficulties. For installment agreements, you need steady income to support monthly payments. Self-employed individuals in North Abington need to show a 25% income decline to qualify for certain penalty relief options. The key is having a tax professional evaluate your specific situation, because the IRS has different qualification standards for different relief programs, and choosing the wrong approach can hurt your chances.

Question 2

How much can I actually save with the Fresh Start Program?

Accepted Answer

Savings vary dramatically based on your financial situation and which program you qualify for. Offer in Compromise settlements can reduce your debt by 80-90% or more—we've seen $50,000 debts settled for $3,000. Penalty abatement alone often saves 25-40% of total debt since penalties compound aggressively. A $20,000 tax bill might include $7,000 in penalties that can be eliminated with proper documentation of reasonable cause. Currently Not Collectible status doesn't reduce what you owe, but it stops all collection activity and prevents additional penalties and interest in many cases. For North Abington residents facing genuine financial hardship, this breathing room can be invaluable while you get back on your feet. The key is getting professional evaluation to determine which approach maximizes your savings while ensuring IRS compliance.

Question 3

What happens if the IRS rejects my Fresh Start application?

Accepted Answer

Rejection isn't the end of the road—it's often just the beginning of the negotiation process. The IRS rejects about 70% of initial Offer in Compromise applications, usually due to incomplete documentation or calculation errors rather than actual ineligibility. When we handle your case, we immediately analyze the rejection letter to understand exactly why the IRS said no. Often, it's something we can fix with additional documentation or a revised offer amount. We then have 30 days to file an appeal with the IRS Independent Office of Appeals. The appeals process gives us a second chance to present your case to a different IRS agent who wasn't involved in the original decision. We've successfully overturned many rejections at this stage by providing better financial documentation or presenting legal arguments the original agent missed. Even if appeals fail, we can often negotiate alternative solutions like installment agreements or partial payment plans that still provide significant relief.

Question 4

How long does the IRS Fresh Start Program process take?

Accepted Answer

Timeline depends on which Fresh Start option you're pursuing and how quickly we can gather your documentation. Installment agreements can often be set up within 30-60 days since they're more straightforward and the IRS processes them faster. Offer in Compromise takes longer—typically 6-12 months from application to final decision. The IRS has specific timeframes they must follow: they have 24 months to make a decision or your offer is automatically accepted. However, the clock stops if they request additional information, which is why having complete, accurate documentation upfront is crucial. Currently Not Collectible status can often be achieved within 30-45 days if your financial hardship is clear and well-documented. The key is having a tax professional who knows exactly what documentation the IRS requires and can present your case efficiently. Trying to navigate this yourself often leads to delays, rejections, and missed opportunities that extend the process unnecessarily.

Question 5

Can I handle the Fresh Start Program application myself?

Accepted Answer

Technically yes, but it's rarely advisable. The IRS provides forms and basic instructions, but one mistake can destroy your chances and potentially make your situation worse. The Offer in Compromise application alone is 58 pages of complex financial disclosure that must be completed perfectly. The IRS scrutinizes every number on your application. They'll question unusual expenses, verify income sources, and challenge any calculation that seems favorable to you. Without professional experience, you're likely to either leave money on the table by offering too much, or get rejected by offering too little. More importantly, the IRS uses your application against you if it's rejected. They now have detailed information about your finances that they can use to pursue collection actions. A tax professional knows how to present your information in the most favorable light while staying within IRS guidelines. Would you go to court without a lawyer? Then why would you go before the IRS without a trusted tax professional?

Question 6

What if I owe money to both the IRS and Pennsylvania?

Accepted Answer

Dual federal and state tax debt is common for North Abington residents, especially small business owners dealing with both IRS issues and Pennsylvania Department of Revenue problems. The good news is that both agencies offer relief programs, though they operate independently. Pennsylvania has its own payment plan options and penalty abatement programs, but they're generally less forgiving than federal options. The state is often more aggressive about collection actions and less willing to negotiate significant reductions. However, Pennsylvania does offer Tax Forgiveness for low-income residents based on family size and income. The strategy is coordinating both cases to maximize your overall relief while ensuring you don't create problems with one agency while solving issues with the other. For example, a federal Offer in Compromise might improve your financial situation enough to handle Pennsylvania debt through installment payments. We handle both federal and state cases simultaneously to create a comprehensive resolution that addresses all your tax obligations.

IRS Fresh Start Program North Abington, PA