tax on forgiven debt

When you are self-employed or run your own business, you have a lot to do and a lot to think about. It’s easy to fall behind on filing a tax return for your business or end up owing back taxes. Many small businesses have been hit hard by COVID-19 and are either struggling to pay the business taxes owed or find the time to file. If you owe back taxes or are behind on filing, Tax Resolution Group can help. We also have some smart strategies to share with you on how to lower your taxable income if you are self-employed, so you end up owing less taxes.

If you’ve realized that you filed a tax return with incorrect or incomplete information, you may be able to file an amended tax return to correct the mistake. Whether you overlooked income from a job or filed a return and then received an additional W2 or 1099, the incorrect tax return can lead to tax trouble with the IRS. Or maybe you realized that you filed with the wrong status or missed a deduction and should have gotten a higher return. We can help with the IRS form and the process for how to amend a tax return from a prior year.

If you owe creditors more than you can afford to repay, you may qualify to have the debt forgiven. But it’s important to know that while debt forgiveness cancels the debt you owe to your creditors, it may create or add to a tax debt to the IRS. Even if you’ve had debt cancelled, you may owe taxes on the forgiven debt.