IRS Tax Relief

Editor's note: Darrin T. Mish was admitted to The Florida Bar in October 1993 and founded his firm in 1996. Any length of practice mentioned in this video reflects when it was recorded (published April 12, 2026).

If you owe money to the IRS, you've probably heard about things like settling your debt for less payment plans or getting collections paused. And naturally, the first question most people ask is, do I qualify for any of that? The problem is that most people are asking the right question, but they're asking it the wrong way because qualification isn't based on what you want to do, it's based upon how the IRS evaluates your situation.

And that's where a lot of people get this wrong. So in this video, I want to walk you through how the IRS actually looks at these cases. Why most people in this understand whether they qualify and what you should be thinking about before you assume any option applies to you. Most people come into this thinking that if they owe money, they must qualify for some kind of relief, and that's simply not the case.

The best candidates for the best programs are actually pretty broke. I know that sounds harsh, but if you have a very low income or a modest income with lots of dependents and essentially no assets, you're most likely going to be a very good candidate for an offer and compromise. If you live in the Tampa Bay area with a family of four and have a six figure income with six figures of equity in your home, most likely not going to qualify or for an offer on compromise.

If you live in a very high cost of living area of the country with the same facts, you may very well qualify. I hate to say it because it's such a cliche, but it depends. The IRS doesn't look at your situation the way that you do. The IRS looks at your income and assets, assumes that you can live based upon their artificial allowable expense schedule, and then they tell you how much you can afford to pay on a monthly basis.

It's not based upon reality. It's based upon bureaucracy. Most people misjudge their situation because they feel broke. They feel like they can't afford to pay the IRS anything. And I see it all the time. But then we analyze their income and expenses, and they're paying $4,000 a month for a studio apartment in the most expensive part of town, and they have a half $1 million equity in it.

In these situations currently, maybe they can't afford to pay anything at all right now, but we can often get them a year of no payments or reduce payments before they have to start paying more, because all IRS collection alternatives depend upon ability to pay. It's not as simple as do I qualify or not? I've been doing this for over 25 years, and even I sometimes need much more data than I can get from an initial consultation.

That being said, virtually every case that we end up taking puts the client in a better situation than they could have achieved on their own. When someone comes to me with IRS debt, I'm not starting with the programs. I'm not looking at offers and compromise. I'm not looking at installment agreements, not yet. The first thing I want to know is, what does the IRS actually think you owe?

And is that number even right? Because a lot of times it's not. The IRS may have filed returns on your behalf, and when they do that, they don't give you any of your deductions or credits. So the starting number is often inflated. Then I'm looking at the collection statute. Every tax that has an expiration date ten years from the date of assessment it goes away. So someone owes money from 2014 and they're sitting here in 2026.

That changes the math on what we should even be doing. Sometimes the best strategy is not to pay it down aggressively. Sometimes it's to run the clock out. Then I'm looking at the full financial picture. What do you earn? What do you own? What can you actually afford? Because that's what determines which direction we go. The IRS has a formula. They look at your income, your expenses, your assets, and then they calculate what they think you can afford to pay.

My job is to make sure that calculation is done correctly, and that we're using the right program for your situation, not just the one that sounds good on the internet. The biggest mistake I see is people choosing a solution before understanding their situation. They hear about an offer and compromise on a radio ad, or they see something online, and they decide that's what they need before anyone's even looked at their numbers.

And what happens is they apply, they get denied, and now they're worse off than when they started, because the IRS just collected all of their financial information through that application. And now they know exactly what you have and what you make. You've shown them your entire hand for nothing. I call that a roadmap. Or sometimes they set up an installment agreement because it seemed like the easy move, and they're paying $2,000 a month on a debt that would have expired in 18 months if they had just waited.

That's the part that gets me. It's not that people do nothing, it's that they do the wrong thing with good intentions, and it cost them sometimes tens of thousands of dollars. The program has to fit the situation, not the other way around. If you owe money to the IRS and you're not sure what you actually qualify for. The biggest mistake I see is people assuming that they know the answer before really understanding their situation.

That's usually the point where it makes sense to step back and look at the full picture before making any decisions. If you want help with that, you can book a call using the link in the description. The better question is at what do I qualify? The better question is what's the best outcome I can get based upon all of my actual facts? Those are two very different starting points.

When someone asks what they qualify for their shopping programs, and that's how you end up in the wrong one. When someone asks what the best outcome looks like, now we're working backwards from the goal. Maybe that's settling for less than you owe. Maybe it's paying nothing because the statute is about to expire. Maybe it's getting the debt reduced first because the IRS number was wrong to begin with.

You don't know until someone looks at the whole picture, the transcripts, the financials, the timelines. So if you're sitting there with IRS debt and you're trying to figure out what your next move is. Just stop to stop googling programs with the facts. What do you actually owe? How long has it been there and what does your financial situation actually look like? That's where every good answer starts.

Most of these situations are manageable. I've been doing this for over 25 years, and I can tell you that the cases that end badly almost never end badly because the situation was hopeless. They end badly because someone waited too long. They did the wrong thing first, or they tried to handle it without understanding what they were actually dealing with. The cases that end well have one thing in common.

Someone sat down, looked at the facts, built a strategy around those facts, and then they executed it. That's it. That's the difference. So if you're in the situation right now, the worst thing you can do is sit in the anxiety and do nothing. The second worst thing you can do is panic and take action without a plan. The move is to get clarity on where you actually stand and work from there.

The IRS is not the final word on what happens to you. They have rules. Those rules have limits. And when you understand the limits, that's when you start getting your leverage back. If you owe money to the IRS, the biggest mistake you can make is assuming you understand your options before you understand your situation. And for a lot of people, the next step after this is some kind of notice or communication from the IRS.

And that's where things can go wrong quickly. So in the next video, I'll walk you through what to do and what not to do. If you receive a letter from the IRS so you don't make things worse without even realizing it.