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Trade Promissory Note for IRS debt?
Could one sign over a promissory note due to pay upcoming IRS taxes? A friend of mine is going to owe the IRS next year but he also invested in a start up company and wants to sign over the promissory note to the IRS and let them collect... is this possible?
I can't find anything on the IRS sites that pertains to this problem..
Edit: Wouldn't the IRS liquidate any of his assets if he can't pay his tax debt?
And wouldn't this Promissory Note be considered an asset?
10 Answers
- Wayne ZLv 71 decade agoFavorite Answer
No
He has three options:
1) Write a check
2) Use a credit card
3) Enter in to an installment agreement.
- StephenWeinsteinLv 71 decade ago
No. You could collect on the promissory note, and then send the money to the IRS. You might also be able to sell the promissory note and send the buyer's money to the IRS. Sending the note to the IRS will not satisfy your tax debt.
- smills0205Lv 51 decade ago
He needs to just set up a payment arrangement with the IRS. He can liquidate the promissory note if possible, and give the money to them.
- prescientoneLv 51 decade ago
Would you accept a promissory note for a debt owed to you? The IRS will allow an installment arrangement and will force sales of assets if you do not comply with their arrangement.
- entiendeLv 51 decade ago
A promise to pay is as good as the person making the promise. The IRS will not accept it as payment. There should be many deductions in a start up company which could and should generate a current refund. He can pay IRS by credit card.
- 5 years ago
Ha Ha!!! No!! Do not sign it!! Pay what you can and whats the worst that can happen? They can take you to court and the judge may order you to pay them what they want. If they are asking you to sign a promissory note then they probably are scared they may not have what it takes to win easily in court. If you owe them the money, then they can get it, but who knows, this may be leverage for you later to settle for less. Do not sign it, save up your money in cash and when you have 50% of the settlement, offer to settle in full with 50%. Have them put it in writing too! Like I said though, pay what you can when you can, the worst thing that can happen is the judge orders you to pay them...then, you pay what you can when you can again :)
- jpr302001Lv 51 decade ago
Probably not. BUT they have an easy finance plan you could apply for which grants up to $25K and you hear back in 24 hours. It's called an Online Payment Agreement and I've heard they are very generous with the program.
- Anonymous7 years ago
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- Anonymous1 decade ago
IRS accepts money for payment of taxes. It does not want dubious securities.
- Anonymous1 decade ago
The IRS is not going to be interested in anything other than cash.
