• dave rosa

IRS Tax Relief - 2018 Guide to The IRS Fresh Start Program

Updated: Feb 15, 2019

What is the IRS Fresh Start Initiative & How Can I Use it to Help With My IRS Debt?

The IRS Fresh Start Initiative was created by the IRS to expand the benefits and assistance originally offered by the IRS Restructuring and Reform Act of 1998, making it ever easier for taxpayers to deal with excessive tax debt. This is your opportunity to get IRS tax relief and get out of tax debt.

This IRS Fresh Start Initiative remains fully available for the 2018 tax year (2019 by Calendar dating), but if you’re looking to take advantage of the program, the IRS tax relief team at Flat Fee Tax Service, Inc. recommends doing it immediately, because there’s no telling if the IRS will take it away.

Fortunately, if you’re having trouble paying off IRS back taxes, then you’ve come to the right place, because this page and our website will teach you how to reach an effective IRS Tax Relief.

Keep reading and our IRS tax relief team will walk you through the entire process, from setting up all the initial paperwork to negotiating with the IRS and reaching an efficient IRS Tax Debt Settlement quickly, and as cheaply as possible.


Whether you choose to handle the IRS Tax Debt Forgiveness process on your own, or you choose to pay for assistance of an IRS Tax Debt Settlement company, https://www.flatfeetaxservice.net was created to help you understand your tax issues so that you could make more informed decisions about how best to proceed in dealing with the IRS.

How Can the

IRS Fresh Start Initiative


The IRS Fresh Start Program was created to help people with IRS tax debt deal with their back taxes more easily.

In fact, the Fresh Start Program introduced some major changes to IRS Tax Debt Relief laws, significantly loosening eligibility restrictions and removing some requirements entirely, making it possible for millions of additional Americans to receive the IRS tax relief benefits they so desperately need.

The Fresh Start Program applies not only to individual tax payers, but also to small businesses having issues with their outstanding taxes, so whether you owe debt for yourself, or for your company, you’ll be able to take advantage of these outstanding benefits.

What Did the IRS Fresh Start Program Actually Do?

There are four main changes to IRS tax laws introduced by the Fresh Start Program, including:

  1. Higher Thresholds for Tax Liens

  2. Introduction of Tax Penalty Relief

  3. Easier Access to Installment Agreements

  4. Expansion of the Offer in Compromise Program

The remainder of this page goes through each of the three IRS tax relief elements above in detail, walking you through exactly what changes were introduced to the system by the Fresh Start Initiative, and then explaining how to take advantage of them to settle your taxes for significantly less than the IRS has demanded you pay.

Should you run into any questions while reading through this content, please feel free to call our tax defense team at 1-800-589-3078 for your free and confidential consultation.

1. Higher Thresholds for

Federal Tax Liens

The Fresh Start Initiative’s first major change to IRS tax laws was upping the minimum threshold amount of back taxes US citizens had to owe before they’d be hit with an IRS Federal Tax Lien.

In most cases, the IRS agreed to stop issuing federal tax liens to anyone with under $10,000 in back taxes, meaning that you can now almost certainly completely ignore the IRS without being hit by a tax lien, until you’ve racked up over $10,000 in debt.

Though federal tax liens aren’t doled out as often as they used to, don’t think that means you’re able to get away free before hitting the magic $10,000 in back taxes owed, because you could still face other collective actions other than a federal tax liens (like wage garnishments, etc.) before reaching the $10,000 minimum.

Another change the Fresh Start Program introduced to IRS tax liens is that they can now be withdrawn once borrowers reach certain requirements for paying off their outstanding back tax debt, essentially, allowing borrowers who had been slapped with a federal tax lien to purge them after they’ve paid enough of their back taxes off to get down under that same $10,000 threshold.

According to the rules of the program, you’ll be able to request that your tax lien be removed once you’ve satisfied this monetary requirement (paid off enough debt that you only owe the IRS less than $10,000), by filing out the IRS Form 12277, otherwise known as the “Application for Withdrawal”.

What’s more… if you agree to pay off your back taxes via a Direct Debt Installment Agreement (this is where the IRS automatically takes a cut of your paycheck each month, for a set amount negotiated in the tax debt settlement process), you can also request that your tax lien be removed, again, by using Form 12277.



And that’s a great deal for anyone who’s in the process of paying back their tax debt, and who plans on doing something like sell their house, business, or other major assets. This would allow you to continue paying back only a small amount of your taxes each month (whatever you negotiated with the IRS), and avoid having the IRS take a bunch of money from you after selling whatever asset you planned to offload.

The only bad news about these changes are that if you do end up getting your debt back over the $10,000 threshold, or if you default on your Direct Debit Installment Agreement, the IRS is going to come after you again by filing a new Notice of Federal Tax Lien, and officially resuming their collection activities.

2. Introduction of

Tax Penalty Relief

If you’ve been struggling with IRS tax debt for some time, then you’re probably pretty familiar with the concept of IRS tax penalties, which can account for up to 40% of the outstanding tax debt you owe the IRS.

Fortunately, part of the impetus for introducing the IRS Fresh Start Program was to help people deal with excessive tax penalties, and give them some financial assistance to get rid of their tax debt altogether, by allowing them to receive forgiveness for at least a portion of the penalties they’re facing.

The Fresh Start Program offers IRS tax relief from a variety of different forms of tax penalties, including penalties for failing to file a tax return on time, failing to file a tax return at all, failure to pay your taxes on time, and failure to make tax deposits, when required.

For many taxpayers in a tricky situation, this will end up being the most valuable part of the entire Fresh Start Initiative, since it can help dramatically reduce your outstanding tax debt, saving you up to 40% of your total outstanding debt owed to the IRS.

3. Easier Access to

IRS Installment Agreements

The IRS Fresh Start Initiative also made it far easier to get access to an IRS installment payment for back taxes, which can save you when you end up owing far more than you can afford.

IRS Installment Payments are perfect for taxpayers who can’t afford to pay their taxes off all at once, because the IRS will let you spread out your tax payments over a period of 72 months (that’s six years), making the payments much smaller, and giving you way more time to pay down the debt.

This is especially important for people who made or received a ton of money one year, but who already spent it before their tax bill came due (a common mistake people make when inheriting money, getting outlandish bonuses, winning the lottery, etc.).

Sometimes, the IRS will not allow you to qualify for the installment payment program until you’ve provided detailed financial statements to them, proving beyond all reasonable doubt that you really cannot afford to pay your taxes off all at once, but oftentimes, this part of the process can be skipped.

One thing to note is that you’re only eligible for this installment payment plan (without additional authorization), if you owe less than $50,000 in back taxes.

If you owe less than $50,000 in taxes, then you can send apply for an installment agreement using either the Online Payment Agreement tool (find it at IRS.gov), or by filing IRS Form 9465, the Installment Agreement form, as your official application paperwork.

If you owe more than $50,000, or if you need longer than six years to pay back your debt, then you have to supply the IRS with a Collection Information Statement (using either IRS Form 433-A or Form 433-F), which is essentially a request for approval to use the installment payment plan.

4. Expansion of the

Offer in Compromise Program

Probably the biggest change to IRS tax law in decades, the final and most important contribution of the IRS Fresh Start Program was the expansion of the Offer in Compromise Program, which allows you to negotiate your debt with the IRS, and offer to pay back less than you actually owe.


The IRS tax relief team at Flat Fee Tax Service, Inc. considers an Offer in Compromise to be similar to a Tax Debt Forgiveness Program, since it allows you to literally wipe out a major portion of your tax debt (based on what you can afford to pay.

An Offer in Compromise is an IRS settlement agreement you reach with the IRS, which lets you settle your tax debt for cents on the dollar, and with the amount you’re forced to pay ranging wildly, depending on what the IRS thinks you can actually afford.

The changes introduced with the Fresh Start Initiative made it easier to qualify for an IRS Offer in Compromise, and they also streamlined the program itself to make it easier to fill out the paperwork and get an approval for debt reduction.




First, the IRS was given additional flexibility in the way that they determined whether or not an individual qualified for approval on their Offer in Compromise letter, allowing the IRS more room for analyzing your ability to pay them back.

Second, because of the changes mentioned above, the IRS was able to expand eligibility for the Offer in Compromise program, and thanks to the reduced eligibility requirements, it’s now available to far more taxpayers than it ever was before.

The way to get an approval for an Offer in Compromise submission is to the IRS financial formula and submit the IRS settlement in such a way that the IRS believes you’re offering the most amount of money that they can possibly believe they’ll be able to collect, over a reasonable period of time.

This is precisely why most people who are submitting Offers in Compromise (and getting them approved), end up outsourcing the work to IRS Tax Lawyers because an individual taxpayer has no idea how the IRS determines what taxpayers can afford, or how close the taxpayer is to being honest about what they think is reasonable for repayment.

The IRS has proven that will simply outright reject any Offer in Compromise if they think you have the ability to pay back the full amount of the taxes that you owe them, either through a lump sum single payment, or even as a series of payments under the Installment Agreement program.

The most important parts of the IRS evaluation process for an Offer in Compromise is to evaluate your income, your assets, and the amount of money that you owe, using some basic math to determine what they think you can actually afford to pay.

If you’re interested in pursuing an Offer in Compromise, then you can play around with the Offer in Compromise Pre-Qualifier tool on IRS.gov, and get an idea of whether or not they would be willing to accept your projected Offer.

How Do I Apply for the IRS Fresh Start Program?

That’s the trick – there isn’t an actual Fresh Start Program to apply to, because it’s just the umbrella tagline for the series of updates our IRS tax relief team has outlined above in this page’s content.

Instead of applying for the IRS Fresh Start Initiative, what you will be able to do is take advantage of the changes the Fresh Start Program introduced into IRS Tax Laws.

Our IRS Tax Lawyers recommendation for anyone struggling with large levels of IRS back taxes debt (over $10,000) is to consider hiring an experienced Tax Attorney, tax professional, or debt resolution agency to help you deal with your outstanding debt, because it’s become increasingly difficult to negotiate with the IRS, and especially to prove that they should allow you to write off some of your outstanding back taxes.

However, if you do choose to pursue an IRS tax settlement on your own, you have only a 30% chance of approval. The IRS will not guide you through the Offer in Compromise process. They will tell you "here are the forms and good luck to you".







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