Let’s talk about something that could actually help for once.
If you’ve ever tried to work out a deal with the IRS to pay off your back taxes in monthly chunks, you know they charge you just to set up the plan. Yep, even if you’re broke and trying to do the right thing, they still hit you with a fee. Makes no sense, right?
Well, that might be changing soon.
There’s a new proposal on the table called the Taxpayer Assistance and Service (TAS) Act, and it’s got a pretty decent idea in there: no more installment agreement fees for low-income taxpayers. Basically, if you’re making less than 250% of the federal poverty line, you’d get a free pass on that setup fee.
Sounds like a no-brainer, right? Especially when you consider that most people who get hit with this stuff are already scraping by.
But here’s the kicker…
They want to base whether you qualify on your last tax return. So let’s say you had a decent year last year, but this year you lost your job, had a medical emergency, or some other real-life curveball hit you—you’re outta luck. You’d still have to pay the fee, even though your current bank account is crying for help.
That part? Needs fixing.
What they should do is give people a way to show what’s going on in real time. If you’re broke now, you shouldn’t be punished because you weren’t broke a year ago.
Here’s the bottom line:
This TAS Act is a move in the right direction. Anything that takes the pressure off folks who are already stressed is a win in my book. But if we really want to help the people who need it most, we’ve gotta account for right now—not what the tax return said months ago.
Stay tuned. If this becomes law, it could make life a little easier for a lot of people just trying to get back on track.
