Self-Employed and Owe IRS Debt in Connecticut? Here’s What You Need to Know
Being self-employed comes with many benefits, but it also means taking full responsibility for your taxes. Without an employer withholding taxes from your paycheck, it’s easy to fall behind on payments and end up owing the IRS more than you can afford. If you’re self-employed and struggling with tax debt, there are solutions available to help you get back on track.
Why Self-Employed Individuals Face Tax Trouble
Unlike traditional employees, self-employed individuals must:
- Make estimated quarterly tax payments.
- Keep track of deductions and expenses.
- Pay self-employment tax on top of income tax.
If you missed tax payments or underreported income, the IRS may hit you with penalties, interest, and aggressive collection efforts.
How to Resolve IRS Tax Debt
If you owe taxes and can’t pay in full, you have options:
- Installment Agreements: Set up a payment plan to pay your debt over time.
- Offer in Compromise: Settle your tax debt for less than what you owe.
- Penalty Abatement: Reduce or remove penalties if you qualify.
- Currently Not Collectible Status: Temporarily delay IRS collection if you’re facing financial hardship.
Get Expert Tax Relief
The IRS takes tax debt seriously, and ignoring the problem will only make it worse. If you’re self-employed and struggling with tax debt, Rappaport Tax Relief can help you find a solution that fits your financial situation.
Call (917) 488-8295 today for a free consultation to discuss your tax relief options.
I Received a CP501 Letter from the IRS. What Do I Do Now?
Receiving a letter from the IRS can be stressful, especially when it’s a CP501 notice. This letter is the IRS’s first reminder that you owe taxes, and it’s important to act quickly before the situation escalates.
What Is a CP501 Letter?
The CP501 notice is an official reminder from the IRS that you have unpaid taxes. It outlines:
- The amount you owe, including penalties and interest.
- The due date for payment.
- What will happen if you don’t respond.
If you ignore the CP501 letter, the IRS will send more notices, and eventually, they may take collection actions such as garnishing your wages or placing a lien on your property.
How to Respond
If you receive a CP501 notice, take these steps:
- Verify the Information: Make sure the tax amount listed is correct.
- Pay the Balance if Possible: If you can afford to pay in full, do so to avoid further penalties.
- Explore Payment Options: If you can’t pay the full amount, you may qualify for an installment agreement or another tax relief solution.
- Seek Professional Help: If you’re unsure how to proceed, a tax expert can help negotiate with the IRS on your behalf.
Don’t Wait – Get Help Today
Ignoring a CP501 letter can lead to serious consequences, but you don’t have to face the IRS alone. Rappaport Tax Relief can help you understand your options and take the right steps to resolve your tax debt.
Call (917) 488-8295 today for a free consultation and get the help you need.