I had a pleasant conversation earlier today with the IRS and learned some interesting stuff about paying my taxes that I wanted to share in hopes it might help someone.
I received a letter in the mail saying my tax refund was applied to the balance of my back taxes, which I knew was going to happen. What I didn’t expect, however, was the remaining balance the letter claimed was owed.
A little frustrated and confused I decided to call the IRS and see what was up. Eventually, after being transferred to the balance department, the wonderful lady on the phone explained to me that there was interest and penalties that accrues on these back taxes.
Now I just want to note, I knew this going in, but I didn’t know why the remaining balance was so much. She walked through each month’s payment, as well as the interest and penalties that accrued over the last 10 months.
Relieved that I wasn’t going crazy, she told me I could write in a letter called a “First Time Penalty Abatement.” Basically, this means that I can write in and request that they remove the penalty fees that accrue, which then adjusts the interest accrued and overall lowers the balance owed.
So my $429 remaining balance dropped down to $306 after this abatement was applied.
I had no idea this was possible and I am so grateful that this wonderful lady took the time to explain and submit it for me over the phone. It saved me a good chunk of money to pay back.
She also told me that once I approach the payoff of the remaining balance to call back and request the abatement for the penalties and it would be removed. Because it’s being applied to the same tax year, the abatement is still considered “first time.”
I’ll also provide a link to the IRS website that explains how one qualifies for a First Time Penalty Abatement and how it works.
I hope this helps anybody who owes on their taxes and is able to cut down on their amount owed.
Just to add some more information as to why my situation was this way: -I had to set up a payment plan to pay those taxes because I couldn’t afford to pay it off at one time. - I never received any statements by mail and have been trying for at least 6 months via the IRS website and phone to set up my online account, to no avail. -My taxes owed was under $2000, so in retrospect saving $100 might seem minuscule to what others might owe or even save.
Submitted March 07, 2018 at 07:30PM by ennylaceb http://ift.tt/2oVVmWk
