If you owe the IRS and your balance seems to be increasing every month, you’re not alone—and more importantly, it’s usually not a mistake.
Many taxpayers are shocked to discover that even if they haven’t filed a new return or received a recent notice, their IRS balance continues to grow. In most cases, this is due to a combination of penalties and interest that continue to accrue over time.
In the video below, I break down exactly why this happens and what you can do about it.
🎥 Watch: IRS Penalties Explained – Why Your Tax Debt Keeps Growing
Why Does IRS Debt Grow So Quickly?
There are three primary reasons your IRS balance increases over time:
1. Failure-to-File Penalties
If you didn’t file your tax return on time, the IRS may assess a failure-to-file penalty of up to 5% per month, capped at 25% of the total tax owed.
This is one of the most aggressive penalties the IRS charges—and one of the fastest ways a tax balance can grow.
2. Failure-to-Pay Penalties
Even if you filed your return, not paying the balance in full triggers a failure-to-pay penalty, typically 0.5% per month.
While smaller than the failure-to-file penalty, it continues to accrue until the balance is resolved.
3. Compounding Interest
In addition to penalties, the IRS charges interest on both:
- The original tax owed
- The penalties added to your account
This interest compounds daily, meaning your balance can grow faster than many people expect—especially with larger tax debts.
Why Larger IRS Debts Grow Faster
If you owe $5,000, monthly growth may feel manageable.
If you owe $50,000, $100,000, or more, those same percentages translate into hundreds or even thousands of dollars per month in additional charges.
This is why many taxpayers see their balance increase significantly over time, even without new activity on their account.
Can You Stop or Reduce IRS Penalties?
In many cases, yes.
Depending on your situation, you may be able to:
- Request penalty abatement
- Set up an installment agreement (which can reduce penalty rates)
- Explore an Offer in Compromise
- Evaluate whether your account qualifies for Currently Not Collectible status
The key is taking action early—waiting often allows penalties and interest to continue building.
Don’t Ignore a Growing IRS Balance
One of the biggest mistakes taxpayers make is assuming they’ll deal with it later.
Unfortunately, IRS debt doesn’t stay the same—it grows.
If you owe a significant balance, especially $50,000 or more, having a clear strategy can make a meaningful difference in how much you ultimately pay and how the situation is resolved.
Need Help Understanding Your Options?
If your IRS balance keeps increasing and you’re not sure why—or what to do next—getting clarity is the first step.
👉 Schedule a confidential strategy call here: Tax Relief Consultation – Jablonsky Tax Relief
Final Thoughts
A growing IRS balance can feel overwhelming, but once you understand how penalties and interest work, you can begin to take control of the situation.
Start by understanding what’s happening—then take the next step toward resolving it.
