The IRS expands assistance to the unemployed who owe taxes Tax filing extension for 6 months

IRS expands assistance to unemployed unemployed people with tax arrears. Tax filing extension for 6 months (Alberta Times) The Internal Revenue Service (IRS) launched a new plan on March 6 to help those who have lost their jobs...

IRS expands assistance to unemployed people with tax arrears, extending tax filing for six months (Alberta Times) The Internal Revenue Service (IRS) launched a new plan on March 6 to help people who are unable to pay their taxes due to unemployment or a significant loss of income. The new program is an expanded version of the earlier so-called Fresh Start program, which was launched in 2008. This week the IRS said it would expand the program to help more people who have experienced a loss of income. Under the expansion plan, the IRS will give those who were unemployed for at least 30 days in 2011 or early 2012 a six-month grace period to pay taxes and waive penalties for six months. In addition, self-employed business owners who have experienced a 25% drop in revenue due to the weak economy will have a grace period. But there are some limitations. For individuals filing a tax return, the taxpayer's income must not exceed $100,000, and for a married couple filing a joint tax return, the taxpayer's income must not exceed $200,000. In addition, taxpayers must not owe more than $50,000 in taxes for 2011. There's one caveat to this offer: The IRS will continue to charge interest on unpaid taxes. Because the IRS has no authority to waive this fee. The IRS is also expanding a program that allows people to pay their taxes in installments instead of a lump sum. For people who owe less than $50,000 in taxes, their repayment period will be extended from 60 months to 72 months. If the tax owed exceeds $50,000, the taxpayer will still have to file a tax return. If a portion of the tax can be paid first to reduce the amount owed to less than $50,000, the taxpayer will be eligible for this program.