Question 1

What is the IRS Fresh Start Program and how does it work?

Accepted Answer

The IRS Fresh Start Program is actually a collection of policies designed to help taxpayers manage and reduce their tax debt. It's not a single program, but rather several options including Offers in Compromise, installment agreements, penalty abatements, and Currently Not Collectible status. The program was created in 2011 to help people overwhelmed by back taxes and penalties. It expanded access to streamlined payment plans, increased the threshold for tax liens, and made it easier to qualify for debt settlements. If you owe $50,000 or less, you may qualify for a streamlined installment agreement without having to provide detailed financial information. The key is understanding which option fits your specific situation. An experienced tax professional can evaluate your case and determine the best path forward, whether that's settling for less than you owe or setting up manageable monthly payments.

Question 2

Can I really reduce my tax debt by 90% or more?

Accepted Answer

Yes, but only if you meet specific IRS requirements for an Offer in Compromise. The IRS will accept less than the full amount owed if they determine you can't pay the full debt or if collecting the full amount would create economic hardship. The IRS looks at your income, expenses, asset equity, and ability to pay over time. They use a formula to calculate the minimum they'll accept. If you're unemployed, have significant medical expenses, or your income barely covers basic living expenses, you might qualify for a substantial reduction. However, not everyone qualifies. The IRS rejects about 60% of Offer in Compromise applications, often because people don't meet the strict requirements or submit incomplete documentation. That's why having an experienced professional prepare and submit your offer is crucial—we know exactly what the IRS is looking for and how to present your case in the best possible light.

Question 3

How long does the IRS Fresh Start Program process take?

Accepted Answer

The timeline varies significantly depending on which option you pursue and the complexity of your case. A streamlined installment agreement might be approved within 30-60 days if you meet all the requirements and owe less than $50,000. An Offer in Compromise typically takes 6-12 months or longer. The IRS has up to two years to make a decision, and they often request additional documentation or clarification during the review process. Currently Not Collectible status can be granted relatively quickly if you can demonstrate immediate financial hardship. The key is getting started as soon as possible. Interest and penalties continue to accrue while you're waiting, and the IRS can take enforcement actions like wage garnishments or bank levies if you don't have proper representation. Working with a tax professional can help expedite the process and ensure you're protected while your case is being reviewed.

Question 4

What happens if the IRS rejects my Fresh Start application?

Accepted Answer

If your initial application is rejected, you typically have the right to appeal the decision or explore alternative options. The IRS must provide a written explanation of why they rejected your application, which gives you valuable information about what needs to be addressed. Sometimes rejections happen because of missing documentation, calculation errors, or failure to meet specific requirements. An experienced tax professional can review the rejection letter, identify the issues, and either appeal the decision or help you pursue a different resolution option. For example, if your Offer in Compromise is rejected, you might still qualify for an installment agreement or Currently Not Collectible status. The rejection doesn't mean you're out of options—it just means you need to take a different approach. Having professional representation significantly increases your chances of success because we understand exactly what the IRS is looking for and how to address any concerns.

Question 5

Do I need a lawyer or can I apply for Fresh Start myself?

Accepted Answer

You can technically apply for IRS Fresh Start programs yourself—the forms are available on the IRS website. However, the process is complex and the stakes are high. One mistake on your application can result in rejection and potentially make your situation worse. Think about it this way: would you go to court without a lawyer? The IRS has teams of experienced professionals reviewing your case. They know every rule, every requirement, and every reason to reject an application. You're essentially negotiating with experts while potentially lacking the knowledge to present your case effectively. Professional representation levels the playing field. Tax professionals understand IRS procedures, know what documentation is required, and can present your financial situation in the most favorable light possible. We can also protect you from IRS collection actions while your case is pending and handle all communications so you don't accidentally say something that hurts your case.

Question 6

How much does it cost to get help with the Fresh Start Program?

Accepted Answer

The cost varies depending on the complexity of your case and which services you need. Most reputable tax resolution companies charge between $2,000 and $7,500 for full representation, though simple cases might cost less and complex business cases might cost more. We provide free initial consultations to assess your situation and explain your options. If you decide to work with us, we'll credit 100% of your consultation fee toward the resolution work. This approach ensures you understand exactly what you're getting and what it will cost before making any commitment. Consider the cost in context of what you could save. If you owe $30,000 and qualify for an Offer in Compromise that settles your debt for $3,000, paying $4,000 in professional fees still saves you $23,000. Even if you don't qualify for a settlement, professional representation can often secure better payment terms, penalty abatements, and protection from enforcement actions that make the investment worthwhile.

IRS Fresh Start Program Shohola, PA