Why Are You Freaking Out About Your Taxes?

by | Apr 3, 2024 | Taxes

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We all know that if there was no IRS, there would be no airports or interstates, because no one would pay their taxes. That said, I think their reputation for being cruel doesn’t line up with the facts.

Their payment plans start out with a minimum, and then people often pay more — but once they set that higher amount they have to stick to it. The length of time you’re allowed to pay is generous, and you can set up payment plans by yourself over the phone.

So why are you freaking out about your incomplete taxes?  It’s not too late because to the IRS, it’s never too late to add to your bill. Even if you haven’t gotten anything to your accountant, it’s a good idea to send what you can, likewise to send a payment of as much as you can. I always picture an IRS agent saying “Aw, they tried their best.”

The fact is that the discretion of agents is considerable, so you never want to get in anyone’s face while telling them about your case. I know private companies track your interactions with customer service reps to detect your personality so…

Unlike surge pricing, the penalties and interest rate do not vary and are public at this website. 

Here are some highlights: 

  • The penalties will have names that include failure to pay, failure to file quarterly payments, failure to provide accurate information, failure to file, etc., etc.
  • The interest is complicated, with some parts of your balance being subject to interest while other parts are not. From what I gathered, an unpaid tax bill is subject to a .05% interest charge every month.
  • In the event the IRS garnishes your wages — which they accomplish by talking to your boss by the way — the most they can take is 25% of your pay.
  • The IRS can and does seize bank accounts, and this is not included in the 25% cap.

If you don’t have the money to pay, talk to them. They’re happy to work with you. They’ll work out a payment plan that’s not overly cruel that you feel is comfortable for you, that you’re not going to renege on. Because the important thing is, if you are going to work out a payment plan with the IRS, you need to stick to it. You need to do exactly what you say you’re going to do. Because if you’re late one time, you can get in trouble.

At JHA, we can do all that for you! Contact us to learn more.