Situations That May Qualify For a State Tax Debt Settlement

When tax debts are owed, it is often not just the Internal Revenue Service (IRS) that you have to contend with. You may also owe taxes to the State of Oklahoma. This means that you will need to deal with the Oklahoma Tax Commission in addition to the IRS. In some cases, the Oklahoma Tax Commission offers leniency and will accept a settlement.

Five Situations Where a Settlement Might Be Possible

While a settlement of your tax debt may sound like a perfect solution to your problem, the Oklahoma Tax Commission will only consider a settlement under certain circumstances. You might have a chance at a settlement for tax debt owed to the State of Oklahoma if you meet any of the following:

  • You would likely have to file for bankruptcy if the Oklahoma Tax Commission collects the tax, along with the interest and penalties accruing on that debt.
  • The settlement amount reasonably reflects the collection potential of the debt.
  • The tax debt is uncollectible because you are insolvent, and the insolvency resulted from reasons beyond your control.
  • The tax debt is attributable to the actions of a third party, and it would be inequitable to hold you liable for the tax liability.
  • The tax debt results from nonpayment of trust fund taxes, and you did not collect the taxes from your customer because you had a good-faith belief that collection of the taxes was not required.

 

If any of the above situations apply to you, you may be eligible for a settlement for your state tax debt. However, it is important to consult with an experienced tax attorney before proceeding further. Taking the wrong actions can jeopardize your ability to obtain a settlement.

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