The IRS Fresh Start Program

The IRS has recently updated its procedures for the collection of past-due taxes to include a “Fresh Start” program.  The program is designed to offer some relief to individuals and businesses which owe  “smaller amounts” to the IRS, and are not out of compliance with Tax Filing requirements, or to those which can be brought into compliance within an acceptable period of time.

To begin, taxes are high and there is an incredible, and ever increasing, burden of compliance and paperwork coming from an array of governmental units.   However, considering the IRS has to oversee the amazingly extensive body of tax law which our congress has passed, the IRS actually does an overall good job of keeping  the government’s money coming in, while enforcing “all of that”.

The establishment of the Fresh Start Program was a move by the IRS which advances its “overall good job”.  The program itself includes three initiatives.  The first is the Fresh Start Notice of Federal Tax Liens, an initiative whose primary provisions include an increase in the dollar amount of tax which must be due before the IRS files a tax lien, and which provides for the “early” release of tax lien, if you enter into certain types of payment agreements.

The second initiative is the Fresh Start Installment Payment Agreement.  This is the type of payment agreement the IRS will accept to allow for the early release of the lien.  The agreement is supposed to provide for the simplified procedures to obtain an agreement, in part by eliminating the necessity to provide certain documentation proving the taxpayer’s financial condition.  It will take time to evaluate how the implementation of this program plays out, and  to see if the lowered documentation requirement actually is what it claims to be.

Finally, there is the Fresh Start Offer in Compromise.  An Offer in Compromise is only one way to deal with IRS debt;  certain IRS debt can be eliminated in bankruptcy.  There is a Statute of Limitations on IRS debt, which should be reviewed, and there are other important considerations which come into play.  The Governmental Accounting Office has, in the past, issued poor reports on the IRS Offer in Compromise program. An effort by the IRS to make this procedure more effective in assisting the government to collect realistic amount of tax from individuals, while allowing individuals to go forward with bright and productive economic futures, is commendable.  Should I say “Hey this is America after all’?

The direct link to the IRS website which discusses this program is

The IRS has a great website.  They do an excellent job here of explaining complex and interrelated tax laws  in as simple, straight forward and understandable a manner as is possible.  If you are interested in the IRS Fresh Start Program, I recommend you review the IRS website on the subject.  I do not recommend that taxpayers with large or somewhat complex tax problems approach the IRS, in any way, without first reviewing the matter with a tax professional.  If you have financial resources or income, and you believe you have the ability to pay the IRS within the time frames the IRS website discusses, you may be a good candidate for the Fresh Start Program.  If you have assets to protect, if you are uncertain of your ability to pay, if you are out of compliance on filing or if you “have other things” to worry about, review the IRS website and then contact a tax professional for further advice.  When the IRS asks you a question, even on a simplified form, they ask it for a reason.  If the question is being asked by Collection Division Personnel, they are asking it to advance their efforts to get money for the government.

Take good care of yourself and your future.