IRS fresh start program for Struggling Taxpayers
  • April 18, 2016
  • admin
  • 0

Taxpayers who are unable to clear their tax liabilities live under a constant fear of the IRS finding out about the non-payment. The IRS, in general, has 10 years to collect unpaid taxes, and therefore, the risk of being caught does not go away if the people lay low. It is, therefore, advisable for taxpayers to address all tax liabilities as quickly as possible. If they struggle to pay what they owe, the IRS Fresh Start Program is there to make it easier for them to pay taxes and avoid liens. Let’s explore the four major components of the Fresh Start Program that help struggling taxpayers.

1. Tax Liens

The Fresh Start Initiative (FSI) has increased the Notice of Federal Tax Lien filing limit from $5000 to $10000. In a few cases, however, the US taxation agency may file a lien notice on amounts less than $10000. The IRS may withdraw the filed Notice of Federal Tax Lien if the taxpayer fulfills certain requirements and pays off their tax debt. To request the lien withdrawal, Taxpayers need to use Form 12277 (Application for Withdrawal) after filing their tax returns and paying their liabilities.

2. Offer-in-Compromise

The IRS Fresh Start Program expands and smoothens the Offer-in-Compromise (OIC) process. An Offer-in-Compromise refers to an agreement that permits taxpayers to settle their tax debt for less than the full amount. The IRS has, therefore, become more flexible in analyzing a taxpayer’s ability to pay. It accepts the offer if the offer represents the maximum that the IRS can expect to collect within a reasonable period. If somebody wishes to find out whether they qualify for this program, they need to fill out Form 656-B.

3. Installment Agreements

Similar to tax liens, provisions of this Initiative raised limits on balances due and the time given to pay the tax liability. IRS announced that the threshold for using an installment agreement without having to supply the IRS with a financial statement has been raised from $25,000 to $50,000. In addition, the time taxpayers have to pay back the taxes they owe had risen from five to six years. The easiest way to file payment plan application is using the Online Payment Agreement tool on the official website of the IRS. The taxpayers who do not have internet access may file Form 9465.

4. Inability to Pay Penalties

The IRS Fresh Start Program has provision for new penalty relief for the unemployed on failure-to-pay penalties. A six-month grace period on failure-to-pay penalties is made available only to eligible wage earners and self-employed individuals. The FSI allows you to delay paying your 2011 taxes due by April 17, 2012, till October 15, 2012 – provided the tax, interest, and any other penalties are paid in full. This penalty relief is also subject to income limits. Taxpayers meeting the eligibility criteria need to fill Form 1127A to obtain the 2011 penalty relief.


These four important features of the IRS Fresh Start Program can, indeed, be valuable in helping many taxpayers get back on their feet. This initiative offers struggling taxpayers a great opportunity to not only get their finances back in order, but also a much-needed relief from stress. If you wish to learn more about IRS Fresh Start Program, or have any other question related to IRS taxation, feel free to get in touch with one of tax experts for a no obligation consultation. You can also fill out our contact form and we will get back to you, shortly.

Please follow and like us:

What Our Clients Have to Say

Susan WilsonSusan Wilson
03:27 25 Jan 23
I have been very pleased with the solid counsel and guidance that Nick Nemeth has provided me regarding my tax issue. I found him to be honest and straightforward which I appreciated. I was impressed with his relevant experience and knowledge . He has definitely brought me peace of mind during a difficult and stressful time.
Sarah HowardSarah Howard
03:44 14 Nov 22
I would like to thank Mr. Nick and his staff for the superb help that I received from them. My IRS problem was resolved quickly and efficiently. It took 2 visits to convince me that I was over my head. I thought that I could call the IRS, appeal my tax notices and settle on a payment plan on my own. After many phone calls to the IRS, waiting sometimes more than 4 hours with no resolution to speak of, it proved to be extremely difficult and stressful. Revisiting Mr. Nick was a huge wake up call. My account was reviewed, and a payment plan was established with the IRS within a week. I will be forever grateful to the staff who worked on my case and especially to Lorna who listened to me vent while going through this painful process.
00:33 07 Aug 22
I cannot say enough good things about Nick and his team. When I first met with Nick he was up front, honest, friendly and efficient. When I worked with one of his attorneys, Eric B, I was just as pleased. All of the staff there are nice and very helpful. I wish I hadn't waited so long to get help with my issue. Over 6yrs I tried getting through and getting anywhere with the IRS and hardly made any progress. I know this may not be the case for all, and even I thought it would take longer than it did, but 3mos and they had my situation straightened out. I still can't believe it. Thank you thank you THANK YOU for all that you did for me. This is a huge burden gone out of my life now thanks to you. If anyone needs help out there, I know you may not want to shell out more money to get their help but it may just save you in the long run.
Spoilly GirlSpoilly Girl
23:49 03 Aug 22
The Nemeth Law team is exceptional. They treat their clients like a family member who is in crisis. They want you to get the best possible outcome. I really appreciate everything that they did for me. Jake and Ashley had the greatest role in my case and it all turned out for the best for me. Thank you Nick and team for easing my fears and getting me through the long process. I'm truly grateful.
Eddie WaltEddie Walt
19:44 12 Jul 22
During a time in which competent, professional service at a fair price seems to have disappeared, Mr. Nemeth and his team are a refreshing breath of fresh air.From my first phone call to the final settlement of our case with a non-responsive IRS, they under-promised, over-delivered and were in constant courteous contact to make sure we knew exactly what was happening and where we stood.I hope to never need their services again, but, should I receive another friendly letter from the IRS...I know who to call!
Quick Inquiry


    Enter the text you see above