Guide to Settling & Resolving Connecticut Back Tax Problems
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- Stop Wage Garnishment and Bank Account Levy
- Remove CT Tax Penalties
- Stop State & IRS Tax Liens
- Settle Payroll Taxes
- File Delinquent CT & IRS Returns
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- Help with CT & IRS Audits
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The Connecticut Department of Revenue Service (DRS) operates in a similar manner to the IRS when handling taxpayers with unfiled and unpaid taxes. One of the main differences is that information on resolving certain problems is not as easy to find as it is on the IRS website.
The State of Connecticut does have a commitment to enforce tax laws fairly and to ensure that honest taxpayers don’t take on an unfair tax burden. The DRS states on their website, “As a Connecticut taxpayer, you have the right to be treated professionally, fairly, promptly and courteously by DRS and its employees.” With that being said, the State of Connecticut will help individuals resolve their tax problems and they should not be afraid to reach out to them for assistance.
Below are some of the common tax relief methods offered by the DRS to help taxpayers get back on track with their tax problems:
If you have been assessed penalties from unpaid taxes, late filings, or an audit, the DRS will explain the penalties owed in detail. If you do not agree with the penalties that have been charged, you have the right to request a waiver of penalties. However, before doing so, the taxpayer must pay all tax and interest due.
In order to do this, form DRS-PW Request for Waiver of Civil Penalty must be completed. The reasons that they can be waived are similar to the IRS, which can be found here. Once you have completed the form, you should then send it with supporting documentation to the following address:
Department of Revenue Services
Operations Bureau/Penalty Waiver
PO Box 5089
Hartford, CT 06103
CT Installment Agreement
If you are not able to pay your income tax bill in full, DRS may allow you to enter into an installment agreement. With an installment agreement, you will be allowed to pay back the taxes owed in monthly increments. Payment plans are generally 12 months or less. The DRS qualifies you based on your tax payment history and your current financial condition. If they determine you will likely be able to afford the payments and will make timely payments, they will approve your request.
In order to request an installment agreement:
- Your account cannot be in a collection status with DRS or with a collection agency
- Taxpayer’s account cannot be under criminal investigation by DRS, under warrant or bankruptcy
- All tax returns are filed
- Current liabilities are $10,000 or less
To set up the payment plan, you can visit the DRS’s Taxpayer Service Center online.
CT Offer of Compromise
Like the IRS, the DRS offers the ability for taxpayers to settle their taxes through a CT Offer of Compromise. With an offer of compromise, the taxpayer may be allowed to settle the taxes owed for less than the total amount if there is doubt as to liability, doubt as to collectibility, or both. This is not an easy type of agreement to get approved, but for some taxpayers, it is the most appropriate resolution method. To file for a CT offer of compromise it is required that the taxpayer fill out Form CT-656 (business) or Form CT-656A (individuals).
CT Taxpayer Services Options
If you or your business were not able to resolve your tax problems through the normal channels that are provided on the DRS website, you can contact the Office of the Taxpayer Advocate. You will need to complete Form CT-TPA and mail it to:
Connecticut Department of Revenue Services
Office of the Taxpayer Advocate
450 Columbus Blvd Ste 1
Hartford CT 06103-1837
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