Experienced Tax Payment Installment Agreement Attorneys in the Twin Cities, Minnesota
Owing federal or state tax debt is an unpleasant experience. We know how important it is for you to address the situation and find an option for paying the outstanding balance that works for you. We also understand that the threat of penalties, interest, and punitive collection measures can be overwhelming, and want you to know that a tax debt attorney in Minnesota can help.
If you have outstanding tax liabilities of $20,000 or more, it is important to know that you have options. At the law firm of Pridgeon & Zoss, PLLC, we use our in-depth knowledge of federal and Minnesota tax law to find workable solutions to resolve your tax debt problem.
Outstanding Balance Solutions
Our firm will work with you, reviewing your payment stubs, bank account statements, and all relevant financial documents and information, and preparing the required financial statement. We will interact with the IRS or the Minnesota Department of Revenue to explore the most appropriate form of tax relief for your situation. Potential options are outlined below.
Installment Payment Agreement
We collect the financial information from you that the IRS will require and work to create a payment plan that will work for you. Most installment payment agreements are kept to five years or less but in some instances, the IRS will accept an agreement that calls for one payment amount for a limited time with a reevaluation of the payment amount after time.
Depending on how much tax debt you owe, your options may include:
- IRS Streamlined Agreement: Individuals owing $50,000 or less may be eligible for IRS streamlined installment agreements. The great thing about streamlined installment agreements is that you need not provide financial statements, which saves you a lot of time and money. The balance must be paid within 72 months or before the collection statute of limitations expires.
- Negotiated IRS Payment Plan: A negotiated IRS installment agreement is generally needed if you owe more than $100,000 or if you owe less than $100,000 but cannot pay the balance within the required period. Since you do not qualify for a streamlined agreement, you must provide the IRS with financial information.
Have the Debt Classified as Uncollectible
With Currently Not Collectible status, the IRS concludes that you don’t have the means or resources to pay your federal income taxes. You may be able to defer paying the IRS until you can afford to do so, without being subject to wage garnishment or a bank levy or asked to enter into an installment agreement. In order to qualify for this relief, you must have little or no money left over after paying essential living expenses, such as rent, utilities, and groceries.
Currently Not Collectible status can provide you with the time you need to get back on your feet financially and determine the best way to address your tax debt. Remember that you will still owe the past-due tax, and the balance will continue to accrue interest and late penalties. However, if you are unable to pay within the 10-year statute of limitations for IRS collections, the debt can expire.
The Minnesota Department of Revenue may also stop active collections when a state tax debt becomes uncollectible. The department may identify your debt as uncollectible for reasons like those below:
- Your available income and assets are insufficient to pay
- The cost of collecting the debt exceeds the amount owed
- Pursuing collection would not be in the state’s best interest
If your financial situation simply will not allow for any payment of your tax debt and you have no assets of sufficient value to satisfy the liability, we will request that the IRS or the Minnesota Department of Revenue classify the debt as uncollectible. We have experience setting forth the evidence required to satisfy the IRS or Department of Revenue in these situations, so talk to a MN tax lawyer at our firm.
Innocent Spouse Relief
In the event the underpayment of taxes is wholly the fault of one spouse, our firm can work with the IRS or Minnesota Department of Revenue to absolve the innocent spouse of the tax liability or establish an equitable payment plan. This situation may arise when the parties have divorced or separated, or when one spouse simply had no knowledge – and could not reasonably have been expected to have knowledge – of the underreporting of income or overstating of expenses.
If you filed a joint return with your spouse and your tax obligation was understated, innocent spouse relief may be an option if you truly did not know about the understatement. You must also be able to demonstrate to the IRS that holding you responsible for the balance would be unfair. However, you must act fairly quickly, because once the IRS begins collection activities against you, you generally have only two years to seek innocent spouse relief.
In sum, if you owe money to the IRS or the Minnesota Department of Revenue, there are different avenues you can take to get in compliance. There are a lot of factors that go into selecting the appropriate option, but in most cases, your financial situation will be the most important consideration. Whatever path you want to go down, it’s important you talk to a tax debt attorney in Minnesota sooner rather than later.
Contact a Tax Debt Attorney in Minnesota
If you think you may qualify for any of these forms of tax relief, it would be wise to speak with a qualified tax attorney at Pridgeon & Zoss, PLLC, to discuss your options.
From offices in Edina and St. Anthony, our tax attorneys serve clients throughout Minnesota and Western Wisconsin. To speak with a Minneapolis attorney about your tax penalties, feel free to contact Pridgeon & Zoss, PLLC for a free half-hour consultation. You may call 952-232-0371 or 612-455-8948 if you are located in the Twin Cities metro area. Outside, you can reach us toll-free at 877-221-1651. You may also use our convenient email contact form.
Weekday office hours are 9 a.m. to 5 p.m. in our Edina office and 10:00 a.m. to 4:00 p.m. in our St. Anthony office. Evening and weekend appointments may be available by special arrangement.