[responsivevoice_button voice=”US English Female” buttontext=”Listen to Post”]
Some of us are lucky enough to receive a return on our tax liabilities, however most people who are self-employed might be overwhelmed with the large amount of money they owe to the IRS. The consequences of not setting additional money aside to return your tax debts, you may find yourself facing an impossibly large amount of debt. Tax problems become a heavy burden and you don’t have to carry them alone. In this case, the best alternative is to consider setting up a tax payment plan.
Setting up a tax payment plan with the IRS is fairly simple, whether you decide to undergo the process independently or with outside help. Either you or your licensed tax attorney can arrange for a tax payment plan to settle your debts in small, manageable increments.
You may opt for setting up a California state tax payment plan if you’re facing difficulties in paying what you owe in state taxes in California. It’s essential to know what you need to do to avoid penalties, especially if you’re not able to pay your tax bills in full at this time. Read on to learn more about payment plans in California.
Can I Make Payments on California State Taxes?
California offers individual taxpayers the alternative to set up a California tax payment plan. In order to be approved, you must meet certain basic eligibility requirements. Afterwards, you’ll have to make consistent monthly payments.
Can I Pay California State Taxes In Installments?
Typically, taxpayers are given three to five years by the state to pay off a balance once a California tax payment plan has been granted. Individual taxpayers need to pay a $34 setup fee that is added to their balance when setting up a payment plan. Meanwhile, businesses are required to pay off what’s owed for the previous twelve months, in addition to a $50 setup fee.
Both individual taxpayers and business owners can apply for the California tax payment plan. The two payment plans are distinctive in their operations, and individuals tend to have a much larger repayment window than businesses. A business payment plan can be granted to a partnership, corporation, or limited liability company.
What Are The Conditions?
Individual taxpayers should meet basic requirements before being granted a California tax payment plan. Meanwhile, applicants must continue to make payments while the request is being processed in order to avoid penalties, new interest, collection fees, or wage garnishment. In order to be eligible, the following conditions must be met:
- Taxpayers should owe less than $25,000 in state taxes.
- Individuals must be capable of paying the full amount in a 60 month time frame.
- Taxpayers should have filed all income tax returns for the previous five years.
Another alternative is paying online, if taxpayers meet the criteria. However, it’s preferable to speak with a professional tax attorney if individuals already have a collection action in place. Additionally, a financial statement will be needed.
How Should I Start?
First, you will need to pay the setup fee. You will then be required to make monthly installments until the bill is fully taken care of. It is advised to have all tax returns prepared professionally to ensure you comply with the state’s requirements that all future tax returns are filed on time.
How Can Victory Tax Lawyers Help?
Victory Tax Lawyers is staffed with a knowledgeable team of professionals that is ready to help clients go through the process of qualifying for a tax payment plan in California. Allow us to keep you informed of your eligibility and apply for the best payment plan option available. Contact our friendly operators to assist you in filing your tax return.
Also Read: How Do Tax Relief Services Work?