If you owe the IRS more than your budget will allow, it may feel like you have few options available. However, from hiring a tax resolution service to requesting an extension, there are many ways to improve your situation. This tax season, consider the following steps if you find yourself cash-strapped when a federal tax bill is due.

What Should You Do If You Can’t Afford to Pay the IRS?

1. Contact a Tax Professional

A tax resolution service center will have the experience needed to assess your best financial options for paying the IRS. These agents understand that no taxpayers are alike and will develop a customized payment plan that'll keep you in compliance without upsetting your budget.

2. Initiate an Offer in Compromise

An offer in compromise (OIC) is an IRS agreement that allows you to pay less than what you owe. The IRS will review your income, assets, and other financials to determine if you qualify. You must not be in an open bankruptcy proceeding, and you must be current on all tax return filings before applying. Also, you'll have to make all estimated payments before an OIC will be considered.

3. Arrange Installment Payments

The IRS will typically allow you to set up a 120-day installment plan to pay what you owe. A tax resolution service specialist can help you complete IRS Form 9465, which requests the arrangement. However, keep in mind that you must pay a fee to use the installment plan, and the IRS will continue to assess late penalties and interest until the full amount due is paid.

4. Request a Hardship Extension

If you're in dire financial straits that prevent you from paying your IRS tax bill, you can apply for a hardship extension using IRS Form 1127. Part of the application process includes providing documentation that shows paying the debt would cause significant hardship. While there are no fees to apply and penalties are not assessed, the IRS may still charge interest if the agency determines you can pay.

If you owe the IRS but don’t have the funds to pay, ZP Tax, Inc. in Silver Spring, MD, can help. Their tax resolution service center works with clients from all walks of life, providing customized solutions for each situation. They’ll take the time to review your taxes and arrange a budget-friendly plan for paying the IRS. To speak with a friendly agent about your needs, call (301) 587-4829. For additional information on their tax resolution services, visit their website.