The IRS Fresh Start program: what it really is
You've probably heard ads promising to get you into the "Fresh Start program." Here's the truth: it isn't one program you apply to. It's a set of IRS rules that made it easier for people to get out of tax debt, and most of them still apply today.
The short version
- Fresh Start was a set of IRS policy changes that started in 2011 and 2012. There's no single application.
- It made payment plans easier to get, raised the balance where the IRS usually files a lien, and made offers in compromise more realistic.
- You "use" Fresh Start by applying for the specific option you qualify for, like a payment plan.
- Be wary of anyone who says they can "enroll" you in Fresh Start for a big upfront fee.
1What Fresh Start is
In 2011, with many people struggling after the recession, the IRS announced the Fresh Start initiative and expanded it in 2012. It changed several internal rules so that more taxpayers could resolve their debts and stay in good standing.
Because it's a collection of rules rather than a single program, there's no "Fresh Start application." Companies that advertise "Fresh Start enrollment" are usually just describing the regular options below.
2What it changed
| Area | What Fresh Start did |
|---|---|
| Payment plans | Raised the limit for streamlined installment agreements to $50,000, with up to 72 months to pay and usually no financial statement required. |
| Tax liens | Raised the balance at which the IRS generally files a lien to $10,000, and made it possible to have a lien withdrawn after converting to a direct-debit payment plan, for balances of $25,000 or less. |
| Offers in compromise | Changed how the IRS counts your future income, which lowered the minimum acceptable offer for many people. |
3Who qualifies
There's no single test, because each option has its own rules:
- Streamlined payment plan: generally a balance of $50,000 or less that you can pay off within 72 months.
- Lien withdrawal: generally a balance of $25,000 or less on a direct-debit payment plan, after a few on-time payments.
- Offer in compromise: your income, expenses and assets show the IRS can't reasonably collect the full amount. Read our offer in compromise guide.
For most options, you also need to have filed all required tax returns.
4How to use it
- Find out exactly what you owe, for every year, from your IRS online account or transcripts.
- File any missing returns. Most options require it.
- Pick the option that fits. Try our relief options quiz or payment plan calculator.
- Apply for that option, online, by mail, or through a tax professional.
Common questions
Is the Fresh Start program still available?
The rules it introduced are part of how the IRS works today, so yes, in that sense. Thresholds and procedures can change, so check the current rules on irs.gov or with a professional.
Does Fresh Start forgive tax debt?
Not by itself. It made the offer in compromise more accessible, which can settle debt for less, but only if you qualify.
Do I need a company to apply?
No. You can apply for a payment plan yourself. A professional helps most when your balance is large, your finances are complicated, or the IRS has started collection.
Want to know which option you actually qualify for?
Answer 3 quick questions and a licensed tax pro will review your situation for free. No "enrollment" fees, ever.
Get Your Free Consultation →Keep reading
Written by Jonathan Samuel, EA, an Enrolled Agent licensed to represent taxpayers before the IRS. This page is general information, not advice for your specific situation.