Do you want to know if you owe the IRS money? You actually don’t have to wait until you receive a letter from the IRS to figure out your IRS tax balance, because all taxpayers have the right to look at their balances directly. The IRS provides four options for doing this:
- Check your balance online.
- Check your balance over the phone.
- Send a request for a balance report by mail.
- Have a tax expert get the information for you.
Each option has its own set of pros and cons. What’s more, you’ll need to be prepared to make your request during specific windows of availability for some of the options.
Let’s take a deeper look at how to check your IRS balance using these four options.
Option 1: Check Your Balance Online
The IRS hosts an ultra-convenient portal that taxpayers can use to view their IRS account details online. In addition to displaying your IRS account balance for owed taxes, the portal also gives you access to your payment history going back 24 months as well as your past years’ tax transcripts. While this resource is free, you do have to go through a setup process that can take time.
The IRS requires you to provide a full roster of information to verify your identity, including your Social Security number (or Individual Tax Identification Number), date of birth, mailing address for your last return, email, and cell phone number. They’ll also ask for information about your credit cards, loans, mortgage, and more.
Another hindrance that goes along with this option is that the IRS only makes this portal accessible during certain windows of the day (Monday: 6 a.m. to Saturday 9 p.m./Sunday: 10 a.m. to 12 a.m.). You may also find that the site is down for routine maintenance pretty frequently. This can be tough if the only time you have to sit down to try to figure out your IRS account balance is in the evenings following work.
Option 2: Call the IRS
Yes, the IRS will pick up the phone for taxpayers! This can be a good option if you feel uncomfortable about supplying so much personal information through an online portal. Just remember that it’s typical to experience wait times of up to 30 minutes when you call the IRS to check your balance. In addition, the line has limited hours that last from 7 a.m. through 7 p.m. local time.
Number for individuals: 1-800-829-1040
Number for businesses: 1-800-829-4933
Number to request transcript by mail: 1-800-908-9946
Option 3: Make a Request by Mail
If putting in the time to set up an account online or waiting on the phone won’t work for you, you can send a mail request to the IRS. This is unsurprisingly the slowest option, so bear that in mind if you’re worried about interest and penalties being pinned to your IRS balance while you wait for documents to arrive in the mail. The IRS won’t waive penalties just because you were waiting to hear back about your balance. You’ll also need to verify that the IRS has your current address because the documents won’t get to you if there’s an older address on your file.
It’s also important to know exactly what you’re requesting when you make a “snail mail” request for your IRS account balance. If you filed a 1040, 1040A, or 1040EZ, you’ll want a document called the “Tax Transcript.” Anyone who filed another type of tax form will need to ask for something called the “4506-T Request for Transcript of Tax Return.” One of the more confusing aspects of this is that a transcript only covers one year. Additionally, penalties and interest may not show up on this transcript.
4. Have a Tax Professional Retrieve Your Balance for You
If you’re feeling intimidated about reaching out to the IRS, you’re not alone! Many people prefer to avoid making contact with the IRS on their own because they’re generally unfamiliar with how the IRS works. Others simply don’t have the time to deal with creating an account or waiting on hold for an IRS representative.
When you put the task in the hands of a tax professional, they will reach out to the IRS to retrieve your balance information. The big benefit of doing this is that you already have someone working with you who can provide guidance if it turns out you owe the IRS money. If this is the case, a tax professional specializing in debt relief will be able to introduce you to some relief solutions that will potentially allow you to get debt managed without penalties and interest.
What to Do When You Owe the IRS Money That You Can’t Pay
You may discover that your IRS balance is at $0 after getting access to your balance information. If this is the case, you should be all set! The only exception is if you requested a paper transcript by mail, because penalties and fees aren’t always represented on those documents. That means that a small amount of unpaid fees could technically become an “unpaid tax debt.” If this is a concern, you can have a tax professional look into the situation for you to confirm that you don’t owe anything more to the IRS.
If you do have a balance, the best course of action is to pay it off. If you can’t pay the balance in full, it’s time to explore options for debt relief through the IRS Fresh Start initiative. The most common form of IRS debt relief is an Installment Agreement (IA) that allows you to pay off your balance over six years (72 months). You may be able to freeze or reduce your balance using options like an Offer in Compromise (OIC) or Currently Non Collectible (CNC) status if you can prove that you’re financially unable to meet your debt obligation.
The one thing you don’t want to do after discovering that you have an IRS balance is to ignore it. The IRS will assign fees, interest, and penalties if your balance remains unpaid. This will eventually lead to liens and levies that give the IRS the right to seize wages, bank accounts, and assets from you in an attempt to settle your debt.
Work on a Tax Settlement for Your IRS Balance
You need a clear picture of what you owe before the IRS begins sending you letters about penalties and collection efforts. You can begin the process of finding out your balance today using the tools available from the IRS. For many taxpayers, the easiest way to get the clearest answer is simply to have a tax professional request a balance report on their behalf.
If you do owe the IRS money, it’s important to get plans in motion for seeking a tax settlement as quickly as possible to avoid IRS penalties. Your IRS balance can grow substantially if you allow the payment deadline to go by without entering into some type of installment agreement or forgiveness plan with the IRS.
At Tax Group Center, we help taxpayers understand their tax balances and how to best pay them off. If you already have a payment plan, we can also help you find your IRS payment plan balance. If you have unfiled tax returns that are preventing you from being eligible for tax relief, we can help you get that taken care of before applying for IRS Fresh Start options. Our tax lawyers have been helping clients work with the IRS to settle tax debts for 30 years. Let us help you get your IRS balance squared away if lingering tax debt is causing you stress. Contact Tax Group Center today to get started!