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What Is The IRS Fresh Start Program?

  • The IRS Fresh Start Program is designed to help taxpayers who are struggling with tax debt. It offers various options such as installment agreements and penalty relief to make it easier for individuals and businesses to pay their taxes.
  • It offers various programs, including an installment agreement and the Offer in Compromise (OIC). The installment plan is designed to allow taxpayers to pay their debt over time, whereas the OIC allows taxpayers to settle their debt for less than they owe if they can prove that they cannot pay the total amount.
  • To be eligible for this program, specific requirements need to be met. The IRS establishes these requirements, which may vary depending on the type of relief sought. For instance, to be eligible for an installment agreement, taxpayers must owe $50,000 or less in combined tax, penalties, and interest and have a history of having filed all required tax returns.
  • Completing the IRS Fresh Start Program can provide substantial benefits. Once the program is completed, liens may be removed, thus enhancing your credit standing. It also helps taxpayers avoid the consequences of tax evasion by offering a feasible plan to pay back their taxes.

In conclusion, if you or your business have open tax debt, you may be eligible for the IRS Fresh Start Program. It’s a valuable program run by the IRS to help struggling taxpayers.

Video Explanation


  • Benefits of the IRS Fresh Start Program:
    • These programs helps taxpayers settle their tax debts over an extended period, preventing financial strain.
    • It can halt aggressive IRS collection actions like levies or wage garnishments.
    • Taxpayers can negotiate the amount owed through an Offer in Compromise (OIC).
    • Reduction or removal of penalties and interest charges for eligible taxpayers.
    • Opportunity to reinstate revoked passports due to tax debt.

Success Stories

  • Case studies showcasing taxpayers who have avoided wage garnishments.
  • Examples of individuals who successfully reduced their tax debts through the OIC.
  • Stories of taxpayers who reinstated their passports after resolving tax debts.

Eligibility Requirements

  • Learn About The IRS Fresh Start Program:
    • Taxpayers must owe the IRS $50,000 or less.
    • They should be able to pay off their debt within six years.
    • The taxpayer must be current with all filing requirements.
    • An active installment agreement should not already be in place.

How To Qualify For The Fresh Start Initiative

  • How to qualify for the IRS Fresh Start Program:
    • Individuals must owe the IRS and not exceed the debt limit.
    • The taxpayer should have a means of repaying the debt within the installment agreement period.
    • All tax returns for previous years must be filed.

Limitations and Restrictions

  • The program doesn’t cover taxpayers who owe more than $50,000.
  • Not all penalties and interest may be waived.
  • Not every taxpayer is granted an Offer in Compromise.

Steps to Take After Completion

  • Ensure to file all future tax returns on time to avoid accruing new tax debt.
  • A long-term financial plan should be made to avoid future tax issues.

Resources Available for Participants of the Program

  • IRS’s official website provides detailed information about the program.
  • IRS-sponsored free tax clinics for taxpayers and seniors making low incomes.
  • Third-party tax professionals or organizations offering assistance.

Tips for Maximizing the Benefits

  • Ensure to apply promptly as soon as you become aware of tax debt.
  • Use the Offer in Compromise Pre-Qualifier tool to see if you qualify for OIC.
  • Seek professional tax help if the process seems overwhelming.

How To Apply:

You can apply for the Offer In Compromise Here:

To qualify for the program, you must fill out and submit Form 1127A or Form 8821.

  • Additionally, those unable to pay the total amount due may be able to settle their balance through an Offer in Compromise (OIC) or Partial Payment Installment Agreement (PPIA).
  • One of the most important things that newbies should know about this program is that it can help them get out of debt faster than they would if they just tried to make payments on time each month.
  • Another key point is that it may not always be possible for everyone who applies; specific requirements must be met before someone can become eligible for this program.
  • Finally, while the Fresh Start Program does offer some relief from liability associated with unpaid taxes, its essential for people using it to understand all of the details so they dont end up worse off than before!
  • Try The Fresh Start Program Calculator here.

Who Qualifies For The Program? Program Benefits And Understanding The Process


Taxpayers who qualify for the program are those ready to pay their tax debt through installments paid over a specific period and decided based on a repayment structure.

If you are an individual taxpayer happy to repay the debts you owe in a series of installments with a direct payment structure, you could benefit from the program. This agreement allows qualified individuals to pay off their taxes in smaller, more manageable amounts over some time, with limited penalties on tax liability.

The IRS will consider your ability to pay, current income and expenses, and asset equity in determining what they believe you can reasonably repay.

Each option has a different procedure, qualifications, and application process.

You have to meet the requirements listed below:

  • You owe less than $50,000 or more than $50,000, but you can reduce your debts to this amount before starting the program.
  • You can pay off your outstanding debt in less than 60 months.
  • Your tax return is filed and up to date.
  • This is the first time you’ve fallen behind on payments to the IRS
  • You will agree to a direct payment installment agreement
  • You will maintain the installment agreement, keep up to date with tax filings, and will not incur further tax debt while you are paying your installments
  • You will file for OIC and can pay off the agreed Fresh Start Initiative settlement amount within 12 months.

As a first-time debtor, you may also be eligible for a reduction of specific penalties. For example, if you owe less than $25,000 or you can reduce your debts to this amount before starting the program, you may also qualify to have a federal tax lien removed.

The program offers three repayment options: an extended installment agreement, a tax lien withdrawal, and an offer in compromise.


For more information on how to apply for the IRS Fresh Start Program, please get in touch with us for a free tax case review.


If your business owes taxes, you could also be eligible for the Fresh Start Program. In this scenario, you will need to meet the following requirements:

  • Your company owes less than $25,000
  • You will be able to repay the total amount within 34 months
  • Your business is up to date with current federal tax filings and payments
  • It’s the first time your company has fallen behind on payments to the IRS
  • You will also need to fill out Form 433-A Collection Information Statement for Wage Earners and Self-Employed Individuals. The qualified business income deduction can be an excellent way to reduce your income taxes for many small business taxpayers.
  • The goal is to make the payments affordable so you can pay them on time without a financial burden.

Of course, we’ve only touched on the basics of the program. If you have any further questions, would like a firm answer regarding whether you’re eligible for the program, or want to apply for the Fresh Start Initiative, don’t hesitate to contact us! Whatever your situation, our qualified, experienced, and friendly tax professionals can guide you in the right direction.

For more information on how to apply for the program, please get in touch with us for a free tax case review.

How Can We Help?

  • We offer financial hardship assistance. 
  • We can prepare your applications and advise you on the appropriate next steps.
  • We will help set up your IRS payment plan.
  • We are tax debt relief experts on your side!