If you or your company is dealing with tax debt, getting resolution of the debt can seem overwhelming, especially when penalties and interest are considered. Typically, whether you are dealing with the state or federal government, payment plans are available. Sometimes, penalties can be waived as part of the deal. Typically, the Kentucky Department of Revenue does not permit tax repayment plans beyond (36) thirty-six months. Depending on your case, the Internal Revenue Service will likewise have time limits on repayment plans. You may also be eligible for an offer in compromise if you have financial hardship. Such an offer may be a lump sum discount and will take into consideration your finances and assets.
If you are denied relief on an offer in compromise and cannot reach terms on a repayment agreement, you might want to consider bankruptcy relief. For individuals, Chapter 13 bankruptcy relief will allow you up to (5) five years to repay the taxes with applicable interest. Likewise, for corporations or individuals not eligible for Chapter 13 relief, Chapter 11 bankruptcy plans typically propose (5) five -year repayment plans for priority tax claims. When dealing with tax debt, you must be diligent to read all tax notices from the government as these will contain important deadlines regarding liabilities, appeal deadlines, and tax levy information. You should consider whether you are eligible for innocent spouse relief or if you have been incorrectly assessed tax liability on any grounds. Failure to take prompt action to address tax liabilities will only result in additional civil penalties and interest and expedite collection activity.
About DelCotto Law Group
DelCotto Law Group is Kentucky’s asset protection law firm known for its commitment to the lifetime success of its clients. With offices located in Lexington, Louisville and Danville, DLG serves Kentuckians with complicated financial matters, especially in the areas of bankruptcy, complex litigation, and estate planning. For more information about filing bankruptcy or DelCotto Law Group, please call (859) 231-5800 or email [email protected].