Resolve IRS Issues: Strategies for Individuals and Businesses
You open your mailbox and your heart skips a beat.
There it is — the envelope marked “Official Government Correspondence.” For both individuals and business owners, seeing those three letters — I.R.S. — is enough to create a wave of anxiety.
Whether it’s due to a missed payment, tight cash flow, or a slow quarter where a payroll deposit was deferred “just this once,” IRS issues don’t just vanish over time.
They escalate — resulting in accumulating interest, penalties, and stress.
The silver lining? You can resolve them. And even amidst a government shutdown, now is the perfect time to tackle them head-on.
The High Price of Procrastination
The IRS may not pursue you immediately, but once it does, it’s persistent.
Each month of delay brings:
Interest on outstanding balances
Penalties for late filings or payments
For businesses, the stringent Trust Fund Recovery Penalty — one of the most severe in the tax code
Even a minor unpaid tax can quickly multiply. A $2,000 debt can effortlessly double with added penalties and interest.
It’s not only about individuals. Business owners who lag on payroll taxes or quarterly payments can face personal liability — meaning the IRS targets not just your business, but you personally.
Step 1: Confront Reality
Many people shy away from IRS letters, fearing the contents. However, the sooner you review that letter (or procure your IRS transcript), the faster you can stem any potential damage.
For individuals:
Access an account transcript directly from IRS.gov to check your balance, penalties, and history.
For businesses:
Get a business account transcript or speak with your accountant to determine if there are missing forms or deposits causing the issue.
Understanding the actual numbers — and whether it’s a single missed payment or multiple years — is the initial step.
Step 2: Explore Your Alternatives
The IRS isn’t there to destroy; it’s a system with rules that can be maneuvered to your advantage.
Key options include:
Payment Plan (Installment Agreement): Organize monthly payments to manage your debt over time. Available for both individuals and businesses under specific limits.
Offer in Compromise: Negotiate to settle your tax debt for less than the full amount you owe if eligible. It’s complex, yet effective with professional help.
Penalty Abatement: If previously compliant or having a valid reason (e.g., illness, disaster), you might have penalties reduced or waived.
Currently Not Collectible (CNC) Status: If you’re currently unable to pay due to financial hardship, the IRS can temporarily halt collections.
Every program has specific documentation and timing criteria — but with proper assistance, they can be very effective.
Step 3: Vigilance in Payroll Management for Business Owners
If your business withholds taxes from staff, these funds are deemed trust funds — thus, they belong to the government upon collection.
Omitting a deposit might seem trivial, but it can quickly invoke rigorous IRS action.
Have you missed payroll deposits or filed Form 941 late? Immediate actions include:
Submit any outstanding forms — even if you’re unable to pay in full.
Collaborate with a tax expert to arrange a payment plan.
Adopt automated payroll software or a dependable provider to ensure compliance.
Maintaining a spotless payroll record safeguards both your business and personal assets.
Step 4: Take Action Now Despite IRS Slowness
Currently, it’s not the usual operation for the IRS. Due to the ongoing government shutdown, almost half of its staff is furloughed.
Implications for you include:
Electronic systems such as e-filing and online payments remain active, and all regular tax filing and payment deadlines are still in effect.
Manual processes — paper correspondence, certain refunds, audits, and call centers — are postponed or temporarily paused.
A backlog is accumulating, which might seem like “extra time” but actually results in less leeway when staffing normalizes.
The approach should be:
Don’t presume the shutdown excuses you. Filings and payments are still required.
Retain receipts and documentation for everything you submit — when IRS operations resume, this proof protects you.
If you can’t currently pay, still file your returns. Doing so minimizes penalties and starts the statute-of-limitations countdown.
If awaiting an IRS reply, prepare your next steps with a tax professional now — ensuring you’re ready when operations resume.
In short, the IRS might be delayed, but it’s still attentive and vigilant.
Step 5: Seek Professional Help for Serious Issues
If your debt surpasses a few thousand dollars, or multiple years’ payroll deposits are missing, handling this on your own isn’t advisable.
An experienced tax professional can:
Quickly access your comprehensive IRS record
Directly negotiate with the IRS on your behalf
Develop payment strategies that protect your business’s cash flow
Ensure future compliance to avert similar issues
This isn’t about judgment — it’s about leverage. Professionals understand how to exploit the system effectively.
Step 6: Establish a “Never Again” Plan
Once your IRS balance is managed, seize this opportunity to create systems that prevent future issues:
Set up automatic estimated payments or payroll tax transfers.
Opt for accounting software that integrates with your bank and payroll providers.
Schedule a mid-year tax consultation with your accountant to avoid unwelcome surprises.
Efficient tax management goes beyond filing; it emphasizes forecasting.
Conclusion
Whether you’re an individual who missed estimated taxes or a business owner managing payroll, IRS challenges don't define you — they just need planning.
Even during a shutdown, the IRS clock doesn’t stall. Taking action timely means more control and fewer surprises once operations fully resume.
Ready to Free Yourself from IRS Stress?
Don’t wait for another notice or another month accruing interest. Whether an individual or business owner, reach out to our expert team today.
We’ll analyze your IRS record, clarify your options, and assist you in designing a comprehensive plan to manage past dues — and prevent future ones.
Want tax & accounting tips and insights?
Sign up for our newsletter.