Boxelder Consulting can help you take advantage of the Fresh Start Initiative by cutting through the red tape and recommending the most advantageous “tax tools” for you. Our team of licensed professionals have decades of combined experience successfully leveraging the Fresh Start Initiative for thousands of individual clients.
Fresh Start Overview
The Fresh Start Initiative is not a a resolution strategy in itself like an Offer in Compromise or an Installment Agreement – instead, it’s a series of changes to current IRS collection procedures and policies. The Fresh Start Initiative acts as an incentive to taxpayers who are making necessary efforts to resolve their tax debt by simplifying the debt collection process. When the IRS designed the program, they included features that make it easier for small businesses and individual taxpayers to repay their outstanding liability while avoiding tax liens and other enforced collection activity.
Think of the Fresh Start Initiative like a tool box that the IRS fills with “tax tools” to help individuals and small businesses resolve an outstanding tax liability. The IRS will make annual changes to the tools it offers based on the needs of the taxpayer – in other words, the tools in your Fresh Start tool box will change with the times and look different from year to year.
Boxelder Consulting can help you take advantage of the Fresh Start Initiative by cutting through the red tape and recommending the most advantageous “tax tools” for you. Our team of licensed professionals have decades of combined experience successfully leveraging the Fresh Start Initiative for thousands of individual clients and small businesses. Call today for immediate tax relief or keep reading to learn more about the Fresh Start history.
Fresh Start History
In 2011, the IRS announced efforts to help some taxpayers get a “fresh start” by making major changes to the process that the agency uses to place a lien on a taxpayers’ property. According to the IRS, their goal was to help individuals and small businesses meet their tax obligations, without adding unnecessary burden to the taxpayers.
The Fresh Start Initiative increased the IRS Notice of Federal Tax Lien filing threshold from $5,000 to $10,000 in hopes of lessening the negative financial impact on taxpayers. The Fresh Start Program also expanded access to streamlined installment agreements. Now, individual taxpayers who owe up to $50,000 can pay through monthly direct debit payments for up to six years.
In 2012, the IRS made adjustments to the Fresh Start Program by offering more flexible terms to its Offer in Compromise (OIC) program that enabled some of the most financially distressed taxpayers to find a suitable resolution to their problems more quickly than in the past. The changes focused on the financial analysis used to determine which taxpayers qualify for an Offer in Compromise. This modification to the agencies processes produced big results for struggling taxpayers – the amount of offers accepted by the IRS increased by the thousands in a single year. Additionally, the revisions made to the Fresh Start Initiative enabled some taxpayers to resolve their debt in as little as two years compared to four or five years in the past.
Fresh Start Changes to the Lien Process
In early 2012, the IRS announced a variety of new rules to help taxpayers with IRS debts avoid liens. The changes to the lien process include the following:
- Significantly increasing the dollar threshold when liens are generally issues, resulting in fewer tax liens;
- Making it easier for taxpayers to obtain lien withdrawals after paying a tax bill
- Withdrawing liens in most cases where a taxpayer enters into a Direct Debit Installment Agreement
- Creating easier access to Installment Agreements for more struggling small businesses
- Expanding a streamlined Offer in Compromise program to cover more taxpayers
Tax Lien Thresholds
Under the Fresh Start Initiative, the IRS significantly increased the dollar thresholds when liens are generally filed. The new dollar amount is in keeping with inflationary changes since the number was last revised. Currently, liens are automatically filed at certain dollar levels for people with past-due balances.
Tax Lien Withdrawals
The IRS also modified procedures that make it easier for taxpayers to obtain lien withdrawals. Liens are now withdrawn once the full payment of taxes is made (if the taxpayer requests it). The IRS determined that this approach is in the best interest of the government. In order to speed up the withdrawal process, the IRS also streamlined its internal procedures to allow colection personnel to withdraw the liens.