How Much Does Tax Relief Cost? Find Out Here | LendEDU

Do you owe the IRS a significant amount in back taxes or face wage garnishment or other penalties for not paying your federal or state of matter taxes ? If so, a tax easing party may be able to help. Use this lead to get an mind as to what you might pay for tax respite services .
In this guide:

How much different tax relief services cost

The costs for tax relief services broadly vary based on how much debt you have, what kind of aid you ’ rhenium want, and the complexity of your tax problems .

Service Average Cost
Discovery/investigation fee $250 – $750
Offer in compromise $2,000 – $7,500
Installment agreements $1,500 – $5,000
Penalty abatement $250 – $1,000
Innocent spouse relief $3,500 – $5,000
Currently not collectible $1,500 – $4,000

Sources: TaxDebtHelp, Optima Tax Relief, and Community Tax

Discovery/investigation fee

The discovery fee is what you ’ ll pay for the company and its tax professionals to do an initial probe into your tax debts. It normally runs between $ 250 and $ 750, depending on the supplier .

Offer in Compromise

An volunteer in Compromise is a way of settling your tax debts with a payment lower than your owed balance. You ’ ll typically pay anywhere from $ 2,000 to $ 7,500 to pursue this option .

Installment agreements

An installment agreement lets you pay your unpaid taxes out over time, via monthly payments. You can expect to pay between $ 1,500 and $ 5,000 for this overhaul .

Penalty abatement

penalty suspension can help you stop engage garnishment or avoid other penalties you might be charged due to your tax debts. In order to stop wage garnishment, you ’ ll have to prove that such an action would create a fiscal asperity. This servicing typically costs between $ 250 and $ 1,000 .

Innocent spouse relief

innocent spouse relief is a means for former partners to avoid tax penalties due to their x ’ s tax return mistakes. Seeking this type of tax aid normally runs from $ 3,500 to $ 5,000 .

Currently not collectible

This military service designates that you ’ re presently ineffective to afford your taxes and can not face penalties or collections due to your delinquent balance. You will typically pay between $ 1,500 and $ 4,000 for CNC condition .


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How tax relief companies structure fees

not all tax solution companies charge the same. While some mission flat rates, others ask for hourly fees. Firms besides differentiate in when they expect payment .
Depending on which party or tax lawyer you go with, you can normally expect one of these payment options :

  • Full payment upfront. Be wary of this, as it could be a scam. You’ll want to be sure you’re working with a proven and reputable company before paying anything upfront.
  • Partial upfront payments. Some firms require you to pay a portion of your total bill upfront. The rest you will pay once the issue has been resolved.
  • Deposits. You might have to pay an initial fee/deposit to secure the company’s services, with the rest of your balance payable upon resolution.
  • Payment plans. With a payment plan, you might make a monthly installment payment until your bill is fully settled.

In most cases, you will at least pay a discovery or investigation fee upfront. This fee compensates the caller for looking into your tax problems and evaluating whether their tax experts can be of aid .

The average cost of tax relief companies

The fees you ’ ll be charged vary widely by tax stand-in supplier. To make surely you ’ re getting the best deal, constantly consider at least a few options. You should besides ask for a fully breakdown of fees so you can accurately compare each company .
Each tax relief party has a alone process for providing tax relief services. still, you ’ ll by and large start with an initial detached reference that helps the ship’s company determine whether you are eligible for their services .
here ’ s what the march normally looks like, at a senior high school flush :

  1. Set up an initial consultation. The initial free consultation is when you’ll go over your tax issues.
  2. The company will contact the IRS for your records and analyze your tax problems. They’ll then propose a solution and break down the costs of resolving your debts.
  3. Finally, they’ll arrange the resolution, which might include an offer in compromise, an installment agreement, or another alternative.

You ’ ll receive parole when your problem has been resolved and instructions on what you should do moving ahead .

Is tax relief worth it?

As you can see, tax relief services can come with potentially dearly-won fees. If you ’ ra considering seeking aid, you ’ ll want to be sure the reinforce outweighs the cost. Have a good manage on how much your tax debt is, and make indisputable you ’ ra clean on the sum costs you ’ ll pay to settle the debt. This calculation can help you determine if the help is worth it. ( For case, if the tax firm charges $ 5,500 but your debts are only $ 5,000, it ’ sulfur probably not the proper be active ).

If tax relief services are besides costly, you can constantly work directly with the IRS to settle your debt. Check out the Federal Trade Commission ’ south instructions on filing CNC condition, setting up an episode plan, and other options, or use the IRS Taxpayer Advocate Service for more aid. The National Association of State Auditors, Comptrollers, and Treasurers is besides available to help with express tax issues .
Remember, everyone ’ s fiscal site is different. While a tax relief company may be able to reduce person else ’ south tax liability, it may not be able to do the same for you. Gather as much information from the party as you can before paying any fees to ensure this is the right access for you .
>> Read More: What is tax easing ?

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Category : Finance

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