If I Owe Money To The IRS, Are My Credit Card Collection Accounts Uncollectible?

Owing Money To The Internal Revenue Service

Though you may be stressed out by credit card debt, there really is nothing like owing money to the IRS. Whether you owe back taxes or you simply need to pay off your debt to the IRS for the year, the IRS offers few exceptions to those who owe money. So you may be wondering: ‘If I have to pay off my debt to the IRS, is my credit card debt now considered uncollectable?!’ Well, the short answer is no. Though you may be way behind on your credit card debt, owing the IRS is not an excuse to not pay your other creditors. In fact, if you are truly suffering from financial hardships, the IRS is usually more willing than credit card companies to work out a payment plan that works for you.

Working Out A Plan With The IRS

Despite the fact that the IRS wants you to pay your taxes right away, they have an option called “Temporarily Uncollectible” that basically means that you are unable to pay off what you owe the IRS at this time. This is usually because you do not have any surplus money and are simply living paycheck to paycheck to survive. This may be because you are using a lot of your money to pay off your credit card debt. If this is the case, the IRS will delay your payment to them until you’ve worked out your other finances. But if they find that you make even $25 extra per week, they will make sure that you use it to pay them back a portion of what you owe. In addition, you can also use your financial troubles to work out a payment plan with the IRS.

How To Cope With Credit Card Collection Accounts

While you can’t just forget about your credit card debt when you owe the IRS, you can use it as an opportunity to get your credit card debt in check by implementing an option like debt consolidation. If you have multiple collection accounts, you can use debt consolidation pay off all of your credit card debt. Then, you can obtain a lower interest rate on your debt, pay less every month and have money left over to pay off your credit cards and the IRS. Though it’s not an ideal situation, it will certainly help matters and assist you in paying off your debt.

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