What is the IRS Hardship Program

Naturally, you want to offer the least possible. This isn't always easy. It all depends on your financial situation. The IRS may accept a smaller offer. This information is available on Forms 433A for wage earners and self employed, and 433B for businesses.

You can find more information in this IRS news release about the individual tax provisions within the American Rescue Plan Act (2021), which was signed into legislation on March 11, 2020. This legislation also included changes for tax relief for employers. Keep checking back to see the latest updates.

Coronavirus relief also includes Economic Impact Payments, Advance Payments of the Child Tax Credit, as well as other financial assistance.

This step will offer relief to both individuals affected and businesses by the pandemic. The IRS can also use this step to prioritize processing tax returns backlogs and taxpayer correspondence in order to restore normal operations for filing season 2023.

Taxpayers owing taxes always had options. They could seek help through payment arrangements and other tools. But, the IRS Taxpayer Relief Initiative expands those existing tools.

A letter addressed to your Collection Information Secretary (Form 432-A), to highlight specific circumstances, is the best way to get attention from IRS. It doesn't need to be long nor formal. However it should be brief and only contain one or a few pages about your tale of woe. It is necessary to attach medical documents and statements from physicians describing your condition. If your medical records fail to indicate the extent of your condition you can explain it using your own words.

Penalty relief is a complex issue for the IRS to administer, Rettig said. We've been working on this initiative for months following concerns we've heard from taxpayers, the tax community and others, including Congress. This is another major step to help taxpayers, and we encourage those affected by this to review the guidelines.

For taxpayers who are unable to pay their full balance, but cannot pay it in full, Installment Agreements can be used. They can also pay the balance over time. If the monthly payment proposal is sufficient, the IRS has expanded the options for Installment Agreements to eliminate the requirement for financial statements or substantiation for balances up to $250,000. In order to limit Federal Tax Lien determinations by the IRS for taxpayers who owe only for tax year 2019, the IRS modified the Installment Agreement procedures.

There are important changes to Child Tax Credit (CTC) which will help many families. The American Rescue Plan Act 2021 (ARPA), expands CTC for tax year 2020 only. Each qualifying child can get a Child Tax Credit of up to $3,000.