What is the Fresh Start Initiative?

Every so often, the IRS will come up with a new plan to help taxpayers get back on track with their debts or balances owed to the government. Currently, that plan is called the Fresh Start Initiative, and it can help taxpayers settle their debts quickly and more easily.


How Long Has This Initiative Been in Place?

The original IRS Fresh Start Program was put into place in 2008 to help citizens resolve their tax problems and aid those in dire straits, and it underwent some growth back in 2012. When they re-tooled the system, the IRS made things easier for those struggling with unemployment or hard financial times. For example, the penalties for failure to pay taxes on time may be waived for those that have been unemployed for a period greater than 30 days under the guidelines of the IRS Fresh Start Program. Qualified individuals who apply can seek a six month extension to pay, with no fear of penalties.

Are There Limitations?

There are varied limitations on who can receive this tax penalty reprieve, and some of the most common include:

Those who are self-employed must provide proof of a 25 percent drop in their net income.
Taxpayers can’t earn more than $200,000 per year for married couples or $100,000 for single filers.
Your tax balance must be below $50,000 at the end of the year to qualify.
There are various other limitations, but a tax professional can guide you through the ins and outs of the process.

How Long Will Processing Take?

Every case is unique, but as a general rule it’s not uncommon for the Fresh Start Initiative process to take several months. There have been cases that can require a year for completion.

What is an Installment Agreement?

An Installment Agreement is granted to taxpayers who would like to pay off their debt in smaller monthly increments. This tactic can help reduce penalties like tax levies from unpaid taxes, and the amount paid may be the full debt amount or a lessened value.

What is an Offer in Compromise?

An Offer in Compromise is an IRS tax settlement option given to taxpayers who are unable to pay the full amount of taxes they owe. This compromise is only offered if the IRS determines the full debt to be unpayable. This offer will only be accepted if the IRS believes the money gained from it will be greater than or equal to the amount they could realistically expect to receive from a taxpayer. There are various stipulations that come along with this rare offer, but Community Tax Dallas has helped many taxpayers decrease the amount of money owed through this IRS system.

Can the IRS Reopen My Debt After a Fresh Start Initiative Settlement?

Yes, a Fresh Start Initiative settlement can be reassessed even after it has been paid. The IRS requires that you finish your payments for the settlement and continue to file and pay all taxes for five years after completing the terms of your settlement package. If you fail to do so, the IRS will likely pursue the full amount of taxes originally owed.

How Do I Know if I’m Eligible?

One problem many taxpayers in debt to the IRS face is keeping up with the changes in programs like the IRS Fresh Start Program. There are many details in the Installment Agreements, Offers in Compromise and other resolution options that can be tough to remember. Some of the changes enacted by the IRS may not impact all individuals in debt and it’s difficult to know whether you fall in that group or not. The new updates to the Fresh Start Initiative are yet another set of rules to keep straight when trying to resolve tax problems.


Thankfully, taxpayers can keep the whole process relatively simple by hiring a company whose entire job it is to keep these facts straight and report them accurately to clients. Community Tax Dallas focuses on staying up to date on the various changes the IRS makes to programs like the Fresh Start Initiative so that their customer base is never left in the dark and receive all the guidance they need to settle their back taxes. This kind of service can help taxpayers to save money, extend deadlines or find their way into the best tax debt resolution plan to meet their needs. Anyone with questions on the Fresh Start Initiative or other IRS programs would do well to contact Community Tax Dallas and get quality help to ease their financial troubles. Call now, for more information and a free consultation!

Call Community Tax Toll-Free at 1-877-409-4106




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