Question 1

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

Accepted Answer

You likely qualify if you owe $50,000 or less in combined taxes, penalties, and interest, and you're current on all required tax filings. The IRS also requires you to demonstrate financial hardship or inability to pay the full amount without economic strain. Self-employed individuals have additional options if they can show a 25% or more drop in income. The program is specifically designed for taxpayers who are overwhelmed by their tax debt and need realistic payment solutions. We evaluate your specific situation during our consultation to determine which Fresh Start options give you the best outcome. Every case is different, and qualification depends on your unique financial circumstances and tax history.

Question 2

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

Accepted Answer

An Offer in Compromise lets you settle your entire tax debt for less than you owe—sometimes 90% less. You make a lump sum payment or short-term payments, and the IRS forgives the remaining balance. This is the most aggressive form of tax relief but requires proving you can't pay the full amount. An installment agreement spreads your full tax debt over monthly payments, typically 3-6 years. You pay the entire amount owed plus interest, but it stops collection actions and gives you manageable payments. This works well if you have steady income but need time to pay. The right choice depends on your financial situation. If you're facing genuine hardship with limited assets and income, an Offer in Compromise might reduce your debt dramatically. If you have steady income but need payment flexibility, an installment agreement provides predictable monthly payments.

Question 3

How long does the Fresh Start Program process take to complete?

Accepted Answer

Most Fresh Start Program applications take 6-12 months for the IRS to process, but collection actions typically stop within 30 days of filing your application. This gives you immediate relief from liens, levies, and wage garnishments while your case is under review. Installment agreements often get approved within 30-60 days since they're more straightforward. Offers in Compromise take longer because the IRS conducts a thorough financial review. Currently Not Collectible status can be granted quickly if you meet the hardship criteria. The key is submitting a complete, accurate application the first time. Incomplete or incorrect applications get rejected and restart the clock. That's why professional preparation matters—we know exactly what documentation the IRS requires and how to present your case for fastest approval.

Question 4

Will the Fresh Start Program hurt my credit score?

Accepted Answer

Enrolling in the Fresh Start Program itself doesn't hurt your credit score. However, existing tax liens may already be affecting your credit. The good news is that successfully completing your Fresh Start agreement can actually improve your credit over time. When you settle your tax debt through an Offer in Compromise, the IRS releases any liens they've filed against your property. This removal shows up on your credit report and typically improves your score. Installment agreements also demonstrate you're responsibly managing your debt obligations. The bigger credit impact comes from ignoring your tax debt. Unpaid taxes lead to liens, levies, and asset seizures that severely damage your credit for years. Resolving your tax issues through the Fresh Start Program stops this damage and starts your credit recovery.

Question 5

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

Accepted Answer

You must be current on all required tax filings before applying for Fresh Start Program relief. The IRS requires you to file at least the last six years of tax returns and any other missing returns before they'll consider your application. This requirement makes sense from the IRS perspective—they want to see you're committed to staying compliant going forward. Filing missing returns also gives them a complete picture of your actual tax liability, which they need to evaluate your Fresh Start application. We help clients prepare and file all missing returns as part of the Fresh Start process. Sometimes filing those returns actually reduces your total tax debt because you had withholdings or credits you weren't getting credit for. Getting current on your filings is often the first step toward significant tax relief.

Question 6

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

Accepted Answer

If your initial application gets rejected, you have appeal rights and can often resubmit with additional documentation. The most common rejection reasons are incomplete financial information, missing tax returns, or not meeting the financial hardship criteria. Professional representation significantly improves your chances of approval. We know exactly what the IRS looks for and how to present your case to meet their requirements. Our acceptance rates are much higher than taxpayers who apply on their own. Even if your first application doesn't succeed, you have other options. We might pursue a different type of Fresh Start relief, negotiate a more favorable installment agreement, or request Currently Not Collectible status while your financial situation improves. The key is having an experienced advocate who knows all your options and can adjust strategy as needed.

IRS Fresh Start Program Starlight, PA