Many people dread filing their taxes, often procrastinating until the deadline. This delay can create unnecessary stress and mental clutter, making it difficult to focus on other priorities. When you find yourself in this situation, you’re likely looking for a straightforward solution that won’t break your budget. Fortunately, there are several options to ease the burden. Here are the top-rated tax resolution strategies for managing IRS debt.
1. IRS Installment Agreements
Instead of paying the full balance up front, this agreement lets taxpayers repay their obligations in manageable installments approved by the authorities. The right type depends on the amount owed and the individual’s financial situation:
- Short-term: Used when the balance will be cleared within 180 days of added time
- Long-term: Designed for larger amounts that require extended time
Many choose this strategy early because it reduces the failure-to-pay fee. Still, certain conditions apply, so consulting an experienced tax professional helps determine the best option for your situation.
2. Offer in Compromise (OIC)
If a taxpayer cannot repay, an Offer in Compromise (OIC) lets them settle their debt for less than the full amount owed, but not everyone qualifies. In 2024, the IRS approved only 7,199 of 33,591 offers submitted.
Eligibility depends on a detailed financial evaluation considering:
- Income
- Necessary living expenses
- Equity in assets
- Ability to pay over time
Because thorough financial disclosure is required, the OIC serves as a lifeline for those with well-documented, long-term hardship. Qualifying taxpayers gain substantial relief, as the IRS bases settlements on what they can realistically pay, not the full balance.
3. Currently Not Collectible Status
If you need a pause because you can’t manage taxes and living expenses simultaneously, you can formally request the IRS to place your account in “currently not collectible” (CNC) status. Do this by submitting a financial statement detailing your monthly income and expenses.
This relief is temporary and best suited for those recovering from job loss, medical hardship or sharp income changes. The relevant authorities review your finances annually, but the tax debt remains. They can still file a tax lien against you.
4. Penalty Abatement
Since penalties can quickly increase your balance and outpace the original amount owed, the IRS offers two paths for assistance:
- First-Time Abatement (FTA): Available to taxpayers who have had a clean tax record for three years but who face penalties for late filing or payment
- Reasonable cause: Individuals affected by serious illness, natural disasters, deaths in the family or other documented events qualify, but they must provide proof, like hospital or court records
5. Chapter 7 Bankruptcy for Older Income Tax Debt
Although not suitable for everyone, Chapter 7 bankruptcy can erase certain older income tax liabilities. The three rules professionals reference most often — the 3-2-240 rule — determine eligibility:
- Tax return due at least three years ago
- Return filed at least two years ago
- IRS assessment is at least 240 days old
Tax lawyers use bankruptcy claims strategically when the debt is old and collections are intense. Since federal tax liens can remain after discharge, it remains crucial for applicants to seek legal help.
6. Innocent Spouse Relief
If you filed jointly and your spouse made errors or hid income without your knowledge, you might qualify for innocent spouse relief. This IRS rule protects you from being responsible for their mistakes, especially in divorce or separation cases. To satisfy the criteria, you must prove you were not aware of the issue when filing and that it is unfair to hold you liable.
7. Wage Garnishment Release
The IRS can garnish your wages and certain federal payments to collect tax obligations until they’re paid off or the levy is lifted. If these deductions leave you unable to cover basic living costs, you may request a release or reduction.
The agency reviews your income, necessary costs and supporting evidence to determine whether a release or modification is appropriate. This often becomes the first emergency step when someone discovers their paycheck has dropped without warning.
Leading Tax Relief Companies to Consider
Here is a list of proven and reliable organizations that can support you as you manage your IRS debt. They can advise you on which strategy to consider.
1. Polston Tax
Polston Tax stands out as the best tax debt relief firm, staffed with top attorneys, CPAs and IRS enrolled agents who guide you through the process. The agency offers a full range of negotiation services designed to ease your financial burdens. With experience dating back to 2001, it understands how the tax authority operates and knows the best negotiation tactics to achieve the favorable outcome you need.
Polston Tax offers a complimentary, confidential consultation and recommends strategies according to your specific circumstances. The structured process helps you move smoothly from gathering financial records to establishing communication with the IRS. This combination of expertise and hands-on case management makes them a top choice for tax relief.
2. Anthem Tax Services
Anthem‘s mission is to fight your taxpayer battles on your behalf. With over 100 years of combined experience in debt settlement and a full range of services, the company helps you achieve the best outcome for your situation. One of its promises is to refund your money if it doesn’t improve your position. Plus, the free eligibility analysis can also save a few dollars.
The firm has certified professionals — including attorneys, enrolled agents and CPAs — who carefully evaluate your case. If you’re looking for realistic solutions without overpromising, Anthem Tax Services is someone you can trust.
3. Community Tax Relief
Community Tax Relief is a solid choice if you’re looking for great value for the cost. The enterprise offers complimentary consultations and transparent fee structures but comes with a few caveats. Limitations include a minimum debt requirement of over $10,000, and its range of tax support options isn’t as extensive as some others on this list.
Still, the money-back guarantee and bilingual services in English and Spanish are strengths that many clients praise. Plus, the Community Tax Relief mobile app is a rare convenience in this industry.
4. Precision Tax Relief
If you want a customer-focused firm that keeps you regularly updated on your case, Precision Tax Relief is the answer. The agency brings over 50 years of combined experience and has earned the trust of 79,000 clients.
A key strength is that instead of assigning a full team, it designates one dedicated person who gets to know your situation inside and out, ensuring they focuses on what’s truly best for you. While there are no minimum debt requirements, Precision Tax Relief often advise clients owing less than $10,000 that hiring them may offer limited value, as fees start at $3,600 for representation.
Tax Resolution Firm Comparison
| Polston Tax | Anthem Tax Services | Community Tax Relief | Precision Tax Relief | |
| Key feature | Structured, hands-on case management process from start to finish | Refunds if it doesn’t improve your financial position | Offers bilingual services and a rare mobile app for case tracking | Assigns one dedicated person to your case |
| Team structure | Attorneys, CPAs and IRS enrolled agents | Attorneys, CPAs and IRS enrolled agents | Attorneys, CPAs and IRS enrolled agents | A single dedicated case manager handles your case |
| Debt and cost | Free confidential consultation to start | Complimentary eligibility analysis | Minimum debt of $10,000 required | Representation fees starting at $3,600 |
| Best for those who | Prefer a well-defined process with a team of experts | Seeking a strong money-back guarantee | Are looking for a cost-effective service, bilingual or prefer managing their case via a mobile app | Values one-on-one and consistent communication |
Methodology for Determining the Best Tax Resolution Agencies
The top tax resolution firms to help manage your IRS debt were thoroughly evaluated using these criteria to ensure an objective ranking.
| Experience | The company should have deep IRS tax resolution expertise, years of experience and a proven track record handling diverse cases to ensure familiarity with situations like yours. |
| Credentials | Its team should be comprised of IRS enrolled agents, CPAs and licensed tax attorneys. |
| Fee Transparency | Clear, up front pricing ensures you know what you’re dealing with. Those with reasonable fees and fair refund options are ranked higher on this list. |
| Reputation | Strong company reputation, positive client and third-party feedback and high ratings from the Better Business Bureau were reviewed. |
| Service | Companies that offer strategies based on individual financial situations were prioritized. Those with unique services were also taken into consideration. |
End Your IRS Debt Cycle With the Right Partner
Your tax relief journey truly begins when you partner with a firm that takes the time to understand your unique situation instead of offering cookie-cutter solutions. These top tax resolution strategies for your IRS debt are just some of the options you should explore. The right choice will guide you through the process, provide solutions tailored to your circumstances and bring clarity to even the most complicated cases.