Self-Employed? Tax Debt Help You Can Use Now

Facing a tax debt you never expected? You don’t have to handle it alone.

Smiling self-employed professional

Tax Debt Help Is for Self-Employed People Too

When you’re self-employed or an independent contractor, you work hard for every dollar. The payback is the ability to pursue work you’re passionate about and freedom from the constraints of working for someone else. 

But that freedom comes with the added burden of navigating the bureaucracy of the IRS and state tax systems and keeping up with estimated tax payments. When you’re working hard to do it right, it can be frustrating to be faced with tax penalties or debt. It’s not too late. We can provide the tax debt help you need now.

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It’s Not Just You: Taxes Are Complicated When You’re Self-Employed

Your tax situation is more complex than for people who are W2 employees. Employers automatically withhold taxes from every employee paycheck—and pay employment taxes as part of the employment arrangement. Employees don’t have to think about taxes until they file each year.

Self-employed man looking at plans

Tax Issues Are Always on Your Radar

When you’re self-employed or an independent contractor, you have to think about taxes all year—and make all your tax payments yourself, including:

  • Estimated tax payments each quarter
  • Self-employment tax, which includes Social Security, and Medicare taxes, in addition to income taxes
  • Additional payments when you file each year to make up for any shortfall in estimated payments
Self-employed woman considering tax bill

Once you fall behind, it gets harder to catch up.

Many self-employed people aren’t aware of all the requirements for ensuring their taxes are filed and paid on time.

  • There is no automatic tax withholding, so self-employed people often simply fail to make required estimated tax payments—resulting in a tax bill that can be a shock.
  • Self-employed income can be limited or unpredictable. Some people may not feel they have enough income to set aside a tax reserve in advance. Then, they are doubly unprepared once the tax is due. 

Regardless of your situation, we have the experience to deal with it—and we can provide the tax debt help you need.

Learn How to Deal with Your Tax Debt

What You Need to Know Now: Facing and Resolving Tax Debt

What happens if you don’t file your taxes? The IRS files for you. That step also initiates a series of added penalties that cause your tax debt to snowball.

Contractor looking at IRS collections letter

Don’t ignore the problem.

When you are paid as a self-employed person or independent contractor, the person or business that pays you typically also reports the payment. You’ll receive a form 1099 that shows that your income was reported. If the amount of the income is enough to file a tax return but the IRS doesn’t get one from you, they file a Substitute for Return.

For self-employed people, fear of being involved in IRS collections is real. The IRS will take steps to collect your tax debt, including:

  • Levies on bank accounts
  • Liens on personal assets
  • Garnishment of tax refunds and money you earn
  • Assignment of a Revenue Officer to pursue collection
  • In the most serious cases, seizure of assets
Self Employed statistics

Don’t wait to file your back taxes.

Even if you are several years behind, it’s important to start where you are. Often, it helps to begin with your current tax year and work backward to file your previous years’ returns.

The IRS doesn’t take the time to consider factors that may be advantageous to you such as itemized deductions, a special filing status, or a Child Tax Credit. As a result, the Substitute for Return often results in a higher tax liability for you.

In addition, the IRS will apply late payment and filing penalties that can be as high as 25% of your liability. Then they add interest that is compounded daily. Soon, your tax debt can be out of control.

Self-employed woman getting tax debt relief assistance

Don’t Panic

You’re not the only self-employed person who owes back taxes—and help is available. A qualified tax professional can help you understand your situation and provide a realistic assessment of the options available to you. Your tax professional can work with you to determine whether you qualify for solutions such as:

  • Offer in Compromise—Under specific qualifying circumstances, the IRS may accept an offer to pay less than the full amount of the debt.
  • Installment Agreement—To reduce the hardship of paying your tax debt, your tax professional can help you set up affordable monthly payments.
  • Currently Not Collectible Status—If repayment would cause significant economic hardship, your debt may be deferred, but not necessarily cancelled.
In addition, once you are caught up on your tax filings, you may qualify for a penalty abatement.
Self-employed professional reviewing tax debt relief options

Avoid the snowball effect by getting tax debt help.

When pursuing any of these options, it’s important to stay on top of the IRS processes and procedures. Don’t miss your opportunity for a collections due process hearing, collections appeals process requests, and due consideration of other requests that you submit.

We’ve worked with tax authorities for over 30 years.

We know what to do, who to contact, and how to get things resolved.

Learn Why More People Trust Us

Tax Debt Relief Experts

We Have Tax Debt Help Down to a Science

For over three decades people have turned to TaxAudit when they have tax issues. We speak the language of the IRS and state tax authorities, we understand their processes, and we implement solutions through a proven approach that gets results.
Because we know what it will take to resolve your issue, we provide a fixed-price quote so that you can get your finances back on track. No surprises.

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