November 6th, 2020

IRS Announces Taxpayer Relief Initiative to Help Those Struggling With Tax Debt

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Author: Michael Y. Goldberg

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On November 2, 2020, the IRS announced the Taxpayer Relief Initiative to help individuals and businesses struggling with tax debt during the COVID-19 pandemic. The Initiative, announced in IRS Notice 2020-248, provides for simplified payment terms, streamlined application processes, expanded no lien payment plans and an increased focus on penalty relief. One of the main goals of the program is remove bureaucratic barriers and increase flexibility for those whose financial condition has been weakened by COVID-19. The program is open to those with new and long-standing tax issues.

The specific relief programs are as follows:

  • A taxpayer friendly approach to incorporate new tax balances into existing payment plans for certain taxpayers
  • Short-term payment plans are expanded to 180 days (from 120 days)
  • Increased flexibility for accepted Offer in Compromise payments
  • Taxpayers who owe less than $250,000 may set up payment plans without providing a financial statement if the monthly payments are sufficient
  • Taxpayers who owe less than $250,000 for tax year 2019 may qualify for an installment agreement without the IRS filing a Federal Tax Lien

Penalty Relief

The Taxpayer Relief Initiative also encourages taxpayers with clean tax histories to apply for reasonable cause and first-time penalty relief.
There are multiple options available to almost all taxpayers to help through this challenging time.

For more information on how the Taxpayer Relief Initiative may help your situation, please contact the Stein Sperling tax department at 301-340-2020