Are You Facing Civil Penalties? We Can Help

The IRS uses penalties and interest charges to encourage taxpayers to comply with tax laws. The Internal Revenue Service(IRS) usually will not legally prosecute people who file their taxes late.  Instead, they impose consequences by assessing interest and penalties, as well as denying refunds. There are two types of penalties, these two types are criminal and civil tax penalties. Which penalty you are facing depends on the seriousness of your tax issue. The Internal Revenue Service will usually only assess a civil penalty, but the penalty can escalate to criminal if warranted.  If you are facing an IRS civil penalty, getting tax debt relief may be a good idea.

What is a civil penalty?

If you are assessed a civil penalty by the Internal Revenue Service, you will be fined 5% for every month that you are past due up to five months after April 15th. The fines increase to 25% per month after five months. Besides these fines, you will be charged a 1% late payment fee each month and the interest charged on the overdue amount will continue to increase monthly as the balance owed increases each month. Interest is charged on the unpaid penalties and fees that are added to your balance. Each month that passes, you will owe even more.

The expenses of an IRS civil penalty and other fees are not a deductible item on your taxes unless it is a business tax. It is best to settle your tax debts as soon as possible to eliminate the increasing debt amount. 

Even though you may not owe any taxes and are due a refund, the Internal Revenue Service can bring charges against you for failure to file and you will forfeit your refund.

If you have allowed many years to accumulate without filing and paying the taxes due, the Internal Revenue Service can file a legal case against you. If found guilty you can be fined thousands of dollars and possibly go to jail for “tax evasion”.

What Are The Two Most Common Types of Civil Penalties?

The IRS has penalties for taxpayers who do not file and/or do not pay their tax returns. The two most common Civil Penalties are Failure to File (FTF) and Failure to Pay (FTP). If a taxpayer misses the deadline to file, they could be charged both penalties. The worst thing to do is ignore your tax obligations. No matter how late you are, file your taxes to avoid penalties. Even if you can’t afford to pay your taxes, you should always file a tax return. The penalty for Failure to File is much more than the Failure to Pay penalty.

Failure to File

It is an IRS civil penalty when you fail to file your taxes by the deadline. The IRS will charge 5% of your unpaid taxes for every month that you file late. The maximum penalty is 25%.

Failure to Pay

Another IRS civil penalty is when you file your taxes on time, but fail to pay the amount that you owe. The IRS will charge a penalty of .5% per month for the unpaid amount. This penalty caps at 25%.

How Long Can the IRS Collect Civil Penalty?

The IRS can attempt to collect a civil penalty for up to 10 years after the tax liability assessment has occurred.

Are You Facing an IRS Civil Penalty?

Many taxpayers don’t know how to or have the knowledge to ask for penalty relief. At CuraDebt Tax, our team of tax professionals are here to represent you and resolve all of your tax issues.

Help with Back Taxes

Penalties and interest sometimes add up to extreme amounts, making it impossible for the common taxpayer to pay off. Our experienced tax professionals can negotiate for complete penalty abatement or at least reduce the amount owed. This will all depend on your financial situation.

We Will Negotiate with the IRS On Your Behalf 

There are many different strategies that our tax professionals will use to negotiate with the IRS. From penalty abatements, reduced penalties, removing liens, and creating payment plans, we can save you money, stress and time.

Contact us today for your free consultation 1-877-999-0486