The IRS often forgives tax debts for people who undergo financial hardships. If your life has changed to the point that you can no longer pay your debts, you may be able to put payments on hold or get out of them completely. How can you prove your hardship? Follow these steps.
Documents for Lack of Money
The first thing you have to do is provide proof of why you cannot make your payments. If you were injured and put on disability, you would need all your disability paperwork. If you were laid off, you would need a document stating your last day of employment. The more paperwork you can provide for this, the better off you will be.
Documents for Current Bills
In addition to the proof above, you need to show the government how much money you are currently paying out every month. This should include rent/mortgage, food, utilities, fuel, car payments, household items, and anything else you need regularly. When the IRS sees that you do not have anything left over to pay them, they will be more likely to forgive your tax debt.
Note that the IRS will look at the national average for monthly bills and compare that to yours. If you are spending too much on transportation, food, etc., they may not approve of your hardship forgiveness application.
Talk to a tax resolution specialist right away to see what the government will forgive. Hopefully you will be in a better place soon.