3 Ways to Help Your Clients Pay Taxes On Time

Tax season is fast approaching, and as the upcoming 17th of May marks the new year’s deadline, advisors are surely in a pinch dealing with clients rushing to pay and beat the clock. Even with the help of professionals, many taxpayers still struggle to cough up enough money to resolve their debts, but the good news is that there are plenty of options you can offer to ease your clients’ tax burden.


What Can You Do to Help Clients Avoid Butting Heads with the IRS?


Tip #1: Ask Clients to Pay Before the Deadline

Your clients don’t need to pay the lump sum in one go, particularly for taxpayers who filed early in the year. Sending gradual payments over a few months is a simple yet foolproof way of meeting their dues, which clients can easily send over to the IRS website straight from their bank account. As the saying goes, slow but steady wins the race, and in this case, you’ll be improving your financial standing and avoiding unnecessary contact with the IRS.


Tip #2: Ask Clients to Apply for an Installment Plan

Many taxpayers struggle to pay before the deadline, so the next best thing is to help your clients file an installment plan so they can set a monthly payment plan that suits their financial capabilities. All they need to do is attach Form 9465 to their tax return as their application! Let your clients know that they have the option to set short-term or long-term plans. A short installment agreement typically lasts for 120 days and does not come with any set-up fees, while long-term payment plans need an additional fee. Fortunately, clients can lower their fees by paying direct debit from their bank account.


Tip #3: Ask Clients to Apply for an “Offer in Compromise”

Clients that still owe taxes often find themselves stuck in a cycle of debt, but they can dig themselves out of the money pit by applying for an “offer in compromise” agreement. It’s a complex and tough application process compared to an installment plan since it caters to taxpayers who are financially unstable despite having a payment plan tailored to their needs. Nonetheless, you can help them by preparing to submit their Form 656 and Form 443-A. When done right, taxpayers stuck in debt can settle their dues for less than the full amount they owe.


The Bottom Line: Providing Solutions that Help Financially Struggling Clients Pay Taxes On Time

Tax planning is a complicated process for anyone, but it can feel like getting trapped into a quicksand. Clients who are juggling payments and a paycheck-to-paycheck lifestyle will need more options to ease their tax burdens, so the list above talks about a few solutions you as a tax professional can offer to help them


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