Owing back taxes to your state government or the IRS can be a stressful situation, particularly when the overall amount is more than you can currently pay in a single lump sum. The good news is that in many cases, you can create an installment agreement that lets you pay off your taxes in more manageable monthly payments. Individual taxpayers can try setting these up alone, but using a tax attorney can make things simpler and more successful.

1. Choose a Tax Attorney With IRS Experience

Not every attorney specializes in the field of tax law. When you want a professional who can help you negotiate your installment agreement, you need to find one with relevant experience with either the IRS or your state's tax authorities. Having a qualified tax attorney at your side means someone who understands tax codes, can navigate procedures, and anticipates possible issues before they happen. They can also ensure your agreement maximizes your financial protection while complying with all the corresponding legal requirements. If you choose a tax attorney with the right expertise, you will be less stressed out about the process of creating an installment agreement.

2. Gather Complete Financial Documentation

Prepare a comprehensive financial picture before you meet with your tax attorney. The IRS requires details about expenses, income, assets, and liabilities to ascertain whether you will qualify for any installment agreement. This information collected will also determine your monthly payments. Your tax attorney uses this information to formulate a realistic proposal about what you can afford, and the IRS is more likely to agree to.

3. Be Honest About Your Financial Limits

Be honest with your tax attorney about what you can reasonably afford in monthly payments. Overstating this can result in a plan you can't maintain, possibly risking additional penalties and default. A veteran attorney can structure payments based on actual financial conditions. They might even be able to negotiate and eliminate certain interest charges and penalties.

4. Explore All Options Before Committing

Installment agreements aren't the only solutions when you have tax debt. A tax attorney can help you explore alternatives when different agreements or temporary delays might be more advantageous in the long run. Evaluating all your options with a tax professional enables you to find the best moves for your circumstances.

5. Let Your Attorney Handle Communications With the IRS

One of the most significant advantages of hiring a tax attorney is letting them communicate with the IRS for you. Doing so minimizes the risk of unintentional disclosures or miscommunications that might hurt your case. Attorneys are adept at responding to IRS notices, pushing back against unreasonable demands, and submitting proper documentation. Professional representation can make the entire process more efficient and less intimidating.

A Significant Financial Step

Coming up with an installment agreement to catch up on unpaid taxes is a big move that's best done with professional guidance. Working with a tax attorney who knows the system can help you negotiate fair terms, avoid common pitfalls, and protect your rights. With proper support, you'll be better positioned to resolve tax obligations and move ahead with peace of mind about your finances.