TAX RESOLUTION: Meaning & Everything You Should Know

Tax resolution

Tax resolution specialists are qualified people who examine and evaluate your tax position and represent you in communications with IRS officials. On the other hand, knowing the ins and outs of financial disclosure and being able to assess the tax relief alternatives you qualify for based on your financial circumstances are essential skills for a tax resolution professional. So in this article, you find out what tax resolution means and every other thing you need to know about it.

What Is Tax Resolution

Tax resolution is the process of engaging with the IRS and tax experts to resolve your tax issues. For a number of reasons, the IRS may not be satisfied with your tax return or current tax situation. The IRS may audit you, for instance, if your tax return is difficult, to make sure you are reporting the correct amount of income and making legal deductions. In rare circumstances, the IRS might think you underreported your income and want to investigate your tax status further.

Why Tax Resolution Should Be Offered

There are many excellent reasons why tax professionals all over the country are expanding their tax resolution services, but let’s quickly look at the main three.

#1. Income that Isn’t Seasonal

Help is needed for people with IRS issues all year round, not just from February to April. Offering tax resolution services enables you to make consistent revenue throughout the year as opposed to having to earn the majority of your income during the few months known as “tax season.”

#2. Increase Income

Do you wish to double your income 8–23 times? Boost your practice by offering tax resolution services. Just $21.43 per hour is the average wage for tax preparation work. On the other hand, tax resolution might be valued at between $175 and $500 per hour.

#3. Enhanced Contentment

Even in a sector where statistics are crucial, it can be challenging to put something like contentment into numerical terms. However, tax professionals virtually unanimously concur that tax resolution work is much more fulfilling (not to mention less monotonous) than tax preparation.

How Does the Tax Resolution Work

Contrary to popular belief, the IRS is more sensitive and understanding. The organization runs a number of initiatives aimed at offering tax relief to eligible people and companies. In order to assist persons and businesses who were having trouble paying their taxes, the IRS established the program in 2011. Three things changed as a result of the initiative:

#1. Liens

The IRS increased the lien dollar threshold as part of Fresh Start. Additionally, it made it simpler to release liens following the payment of taxes and permitted their release whenever a taxpayer established a direct deposit payment plan.

#2. Installment Agreements

 Fresh Start facilitates the creation of an installment agreement between a taxpayer and the IRS to settle back tax obligations. People who owe less than $50,000 now have a simpler application process for agreements because they can do so online without having to complete specific papers. Additionally, Fresh Start increased the repayment period from five to six years.

#3. Offer in Compromise

 Fresh Start also increased the program’s eligibility, which made more people eligible for it. You can reach a settlement with the IRS and pay less than what you owe by submitting an offer in compromise. When all other options for tax relief have been explored and exhausted, this one is still an option. Taxpayers with earnings up to $100,000 and tax liabilities up to $50,000 may qualify for an Offer in Compromise under Fresh Start.

Tax Resolution Service

You might employ tax resolution services in the following situations:

#1. Representation in Audits

Don’t freak out if you get a notification from the IRS saying you’re about to be audited. Although the audit procedure might seem scary, you don’t have to go through it alone. For a variety of reasons, the IRS audits people, but just because they choose to audit you don’t indicate you did anything wrong. You can feel more secure knowing that the results of the audit will be as accurate and fair as possible by hiring a qualified tax expert to assist you in putting together an audit defense.

#2. Installment Contracts

You have the option to spread out your tax debts over a period of time, typically a few months or years, through an installment arrangement. You can prevent additional penalties like wage garnishment, tax levies, and other things by setting up a payment plan. There are different kinds of installment agreements, and a tax resolution specialist may help you choose the best one for your particular situation and assist you with filing.

#3. Statement of Protest

Even the IRS is not perfect. Sometimes it estimates your income higher than it actually was or includes income from an ex-spouse or a previous business partner. If that occurs, you have the right to argue with the IRS and provide supporting documentation. To avoid having to pay the money you don’t owe, tax professionals can assist you in putting up a transcript protest.

#4. Non-Recoverable Debt

What happens if you owe the IRS so much money that you are unable to repay it while still managing to pay your basic living expenses? You don’t have to decide between having a roof over your head and paying the IRS in that case.

When you are unable to pay your tax burden, the IRS does provide some sort of help. The IRS won’t make an effort to collect the debt you owe while you are in what is known as a “Currently Not Collectible” status. You can determine if you are eligible for the status and learn about its advantages and disadvantages by using tax resolution services.

#5. Penalty Taxes

When people or corporations pay their taxes late or not at all, the IRS frequently assesses interest and tax penalties. Thankfully, there are several situations where the IRS will forego the fine. Tax resolution companies can guide you through the process of evaluating whether or not you qualify for the penalty waiver and can assist you in determining your eligibility for tax penalty abatement.

#6. Incomplete Returns

Every year, you are required to file a tax return, but there are times when life’s circumstances may prevent you from doing so. When that occurs, the IRS may make an educated guess as to how much you owe based on the paperwork it has already received, like Forms W-2 and 1099. You can get help preparing returns from prior years from a tax counseling company. Additionally, it can assist you with filing current taxes and collaborate with you to create a future tax strategy.

What Can Tax Resolution Do For You

Even though you do have the option of handling your tax problems with the IRS on your own, it’s frequently to your best advantage to consult with tax experts who can assist you in dealing with the IRS and finding a solution to your issue.

The Taxpayer Bill of Rights published by the IRS describes your rights as a taxpayer. You are entitled to: 

  • Be informed 
  • Receive top-notch service
  • Never pay more than you have to
  • Challenge the IRS and make your voice heard.”
  • Appeal the IRS’s ruling, retain counsel, and maintain confidentiality.
  • A just and equitable taxation system

By collaborating with a business that offers tax settlement services, you can make sure your rights are upheld. A tax resolution company can:

#1. Analyze the Situation

Setting up a consultation is the first step when working with a tax resolution company. You will have the chance to discuss your specific problem at the meeting, and a tax expert will have the chance to look through your records and evaluate your case.

#2. Construct A Defense

The next step is to develop a plan to assist you in working with the IRS to reach a resolution that is acceptable to both parties if a tax consultant or enrolled agent thinks your case can be resolved. An enrolled agent will review your records to gain a complete picture of your circumstances if you are the subject of an audit before putting up a defense for you.

#3. Fill The Go-Between Role

Your tax advisor may act as a middleman or arbitrator between you and the IRS. You won’t ever have to worry about dealing with the IRS alone if you work with a tax resolution company.

Enrolled agents and tax consultants have extensive knowledge of tax law and years of experience working with the IRS. They are aware of your legal rights and what the IRS may and may not hold against you. By hiring a professional to represent you, you’ll experience less stress and have a better chance of success.

Tax Resolution Companies

#1. Precision

In every category, Precision Tax Relief comes out on top, including the firm’s substantial money-back guarantee, open pricing, and practical communication methods. And this happens to be one of the most reliable tax companies.

#2. Tax Defense Network

For those who struggle to communicate with the IRS and speak Spanish, Tax Defense Network provides bilingual tax assistance. Given the company’s lengthy history of success, we would suggest it as a dependable middleman for Spanish-speaking people who owe taxes.

#3. Anthem Tax 

Anthem Tax Services offer the only money-back guarantee of its sort in the tax relief sector. If the organization fails to modify your IRS tax debt payback schedule, the guarantee, which has no time restrictions, guarantees a fee refund.

#4. ALG Tax Solutions

ALG Tax Solutions provides a vast collection of free instructional materials aimed at empowering customers and reducing tax debt in the future. We value the business’s dedication to assisting clients in finding the best answer for their particular circumstances, regardless of whether or not that solution entails using paid tax relief services. ALG Tax Solutions gains recognition as the tax relief business with the best resources as a result of this.

#5. CommunityTax 

Despite not having the lowest minimum debt requirement in the tax relief sector, CommunityTax earned the title of Best for Small Tax Debt thanks to its extensive resources and services catered to those with smaller debt loads. Through CommunityTax’s generous free online resource library and mobile app, you might be able to find all the assistance you require for nothing if your tax burden is less than $10,000.

Tax Resolution Specialist

A tax lawyer, certified public accountant, or enrolled agent must successfully complete a demanding certification program that includes educational, practical experience, and examination requirements in order to become a certified tax resolution specialist.

Regardless of how big or minor your tax issue is, employing a professional with knowledge and experience can significantly lessen your suffering. A trained tax resolution professional can assist you in the following cases:

#1. Missing Tax Returns

Regularly failing to file can seem like a huge obstacle to overcome, especially if you haven’t done so in a while, but it isn’t necessarily that bad. An expert in tax resolution can examine your records and sort everything out.

#2. Owe a Sizable Quantity of Money to the IRS

Aggressive collection methods are frequently used when there is a significant IRS debt, which can be very distressing. In order to prevent the problem from growing worse, hire a skilled tax resolution specialist to negotiate on your behalf.

Combining personal and business money can result in errors on your tax return that could get you into trouble if you’re a small business owner or a self-employed person. It is essential to have a professional untangle the mess and make the necessary repairs so that the issue does not worsen.

#3. Relief for the Innocent Spouse

It might be a tremendous shock to learn that your current or former spouse is to blame for your fines and tax obligation. An expert tax advisor can assist in clearing up any misunderstandings and obtaining relief from unfair fines.

The IRS determines how much money to deduct from your salary, frequently leaving you unable to pay your payments. Your wage garnishment can be resolved permanently by working with a licensed tax settlement consultant who can assist in negotiating the amount.

#4. Lien Relief

 Normally, the only way to get a lien lifted is to pay your tax due, but in some circumstances, tax professionals may be able to help you have a lien dropped, subordinated, or dismissed from a particular property.

Are Tax ResolutionCompanies Legitimate?

There are reputable tax settlement companies. These businesses are open and straightforward about whether you can use their services and charge reasonable costs.

What does a Tax Resolution Specialist do?

An expert in finance or law who assists people and corporations in managing their tax issues is known as a tax resolution specialist. These tax professionals have a wealth of knowledge when it comes to IRS tools like offers in compromise, installment plans, and penalty reduction.

How Much Can You Make in Tax Resolution?

Work From Home Tax Resolution Specialists in the US make an average of $42,478 a year. That comes out to about $20.42 an hour, in case you need a quick pay calculator. This amounts to $816 per week or $3,539 per month.

What is the Best Way to Resolve Back taxes?

  • Consult a qualified tax relief practitioner.
  •  Know your options
  • File any outstanding tax returns right away
  •  Pay any back taxes
  • Don’t give false information.

How much will the IRS usually Settle for?

Generally speaking, the IRS will only accept payments that it believes you can make. Your assets (such as a home or car), your income, your monthly expenses (such as rent or mortgage payments or child care costs), your savings, and other factors will all be considered in calculating this. A typical OIC settlement is in the neighborhood of $5,240.

Will IRS Negotiate Back  Taxes?

You can settle your tax liability for less than the whole amount you owe by making an offer in compromise. If you are unable to pay your entire tax debt or doing so would put you in a difficult financial situation, this may be a viable choice.

Who Qualifies for IRS fresh start?

Every taxpayer who owes taxes and is having trouble making payments is eligible for the Fresh Start program. No financial requirements apply. In order to determine your eligibility for the IRS Fresh Start program, you must first speak with one of your tax lawyers or accountants.


You can submit a tax relief application on your own, but many people choose to engage with a tax expert to make sure they are following the procedure correctly and to increase their chances of receiving the relief they require. Be aware that not just anyone can assist you or represent you if you decide to seek aid with your tax issue.


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