Writing A Hardship Letter Tax Deferral

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If you are under financial hardship and you are unable to pay for your taxes, one way to get some relief is by writing a hardship letter to the IRS for a tax deferral. Of course, this letter will only be considered if what you have written is genuine and if you can prove it. One of the deferrals you may be eligible for is a one year property tax deferral. That does not mean that you won’t have to pay the tax at all, but rather that you can have a break for one year, paying the missed taxes at a later stage.

Basic Rules for Writing the Hardship Letter

Make sure that your letter is clear, concise, and short. Do not exaggerate your situation, but rather state the facts. Address the letter to your county assessor, which you can obtain through their office over the telephone. Make sure the letter is written formally and that it is free from grammatical and spelling mistakes. Also include photocopies (not originals) of every piece of evidence you want to provide.

Possible Reasons for a Tax Deferral

Each state has its own criteria for accepting or denying such a deferral. However, most will accept failed business, separation or divorce, death in the family, illness or disability, unemployment, and/or activated military personnel, as good reasons. However, it is advisable to check your state’s specific rules and regulations. It is likely that there are specific programs that your state has available, and you need to apply to the one that is most appropriate to your needs.

Possible Programs Applicable for a Hardship Letter for Tax Deferral

The letter you will write will vary depending on the program that is applicable to you. Some of the options are:

  1. Programs for those who have had a mortgage on their current property for at least five years
  2. Programs for nonprofits, who may receive federal but not state tax exemption and who now operate a business that is exempted under state legislature
  3. Programs for veteran widows and widowers with low incomes
  4. Programs for people over the age of 60
  5. Programs for individuals who are retired due to a disability
  6. Programs for those whose home has been damaged by natural disaster
  7. Programs for long term occupants
  8. Programs for returning veterans

Whichever program you apply for, you will need to include documented evidence of your situation. This will usually include your federal income tax statement, your paychecks, copies of any outstanding debt, and your general monthly bills.

What to Do If Deferral Is Approved

If the IRS grants you the deferral, you must start to prepare yourself for next year. This is because, at that point, you will not only have to pay your regular taxes, but also the taxes from the year that you have missed. Should you find yourself in difficulty for several years in a row, then it is likely that you will be asked to enter into an escrow arrangement, which can be done through your mortgage provider. This means that you pay slightly more every month to your lender, who will then make the property tax payments. This means that you don’t have to pay a huge sum in one payment.

Hardship Letter Tax Deferral Example

{Your Name}
{Your Address}
{Your Phone #}

{Date}

To Whom It May Concern:

I am writing this letter to explain why I am unable to pay my property taxes this year. I have recently fallen upon difficult times financially and would like to request a deferral.

In the last few month my financial situation has become dire due to {the loss of my job, an illness, a death in the family, be specific}. I am no longer to pay for {medical bills, mortgage, etc.} and I am concerned that I will have to {foreclose, file for bankruptcy, etc.}

I am not attempting to avoid paying my necessary debt to society, and I understand that I will owe these taxes next year. I would just like to explain that I am in an unusually difficult position this year and require the deferral in order to get back on my feet.

I am attaching my federal income tax return from last year, as well as my credit card bill from the last two months. I hope they make my position clear.

I appreciate your time and consideration. I look forward to hearing from you soon concerning this matter.

Sincerely,

{Sender Name}

Writing A Hardship Letter Fee Waiver

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A hardship letter fee waiver is a formal written request in which you are requesting an entity to which you owe money to forego of a fee, penalty, or other form of restriction that has been imposed on you. There are different types of fees, some of which are included as standard but many of which are charged as a type of penalty. For instance, if you let a check bounce or if you miss a payment on your credit card, you may be charged a late payment fee. Unfortunately, these fees often make the financial difficulties you are experiencing even worse, which is why you may want to write a hardship letter.

Before looking at what should be included in the letter, it is important that you understand that there are no guarantees. Fees are charged as part of the terms and conditions that you signed up to when you agreed to a certain service. Hence, although some entities may be understanding of your situation, they are under no obligation to grant your request.

What the Hardship Letter Fee Waiver Must Contain

A hardship letter fee waiver is a formal letter and should be treated as such. This means that it has to be addressed to the right person in the right format. This includes a proper address, and an explanation of what is happening. A good letter is one that fits on a single page, and it can be difficult to convey all the information that you want to pass on in such a small space. However, this demonstrates the importance of focusing on facts.

What the Hardship Letter Must Indicate

What your letter should indicate is why you were charged a fee and why you are requesting that they waive it. You should explain that you are in financial hardship due to specific events and provide evidence of this hardship to the entity to which you are writing. Anything you claim should be supported by evidence, of which you should attach copies. These should include things, such as termination of employment, an unexpected reduction in hours, medical bills, the death of a loved one, etc.

You should also explain why you ended up in the situation in which the entity had to charge a fee. Do not, however, blame them for this. Again, the fee is part of the terms and conditions that you have agreed to. However, you can state that the fee would be impossible for you to pay right now as you are already experiencing hardship.

The letter should also include your solution. For instance, if you have been charged a late payment fee for your cellphone bill, make sure that you have paid the bill to which the fee was attached before you ask them to waive the fee. Creditors can be understanding so long as the hardship is genuine and properly explained. This means that you have to be straight to the point and present them with facts. They are not interested in hearing how those facts have made you feel.

Hardship Letter Fee Waiver Example

{Your Name}
{Your Address}
{Your Phone #}

{Date}

To Whom It May Concern:

I am writing this hardship letter to request that my application fee be waived in light of my financial circumstances.

My family and I are hard workers, but this expense would be an undue hardship upon our situation. My parents’ total income is {amount} per year, but in addition to that they are supporting {number} dependents and paying {amount} for schooling between {number} of their children. Furthermore, recently {illness, natural disaster, family death} has cost them {rough amount} in {hospital bills, fees, etc.} I hope it is clear to you that, while I am both ambitious and determined concerning my education, I cannot hope to be considered without this waiver. It would mean a lot with regards to my future.

I am attaching my parents’ income reports and expense worksheets as well as their returns from the past year. I am also attaching my transcript, as proof of my hard work and enthusiasm in apply to this {institution}.

Thank you for your time and consideration.

Sincerely,

{Sender Name}

Writing A Hardship Letter Driver License

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Having a driver license is essential for most people. It allows them to travel to and from work, take their children to school and after-school activities, make hospital appointments, care for elderly relatives, volunteer in the community, and more. However, there are situations in which you may not be able to have a driver license although this could cause you undue hardship. If that is the case, writing a letter to the Department of Motor Vehicles (DMV) to explain your situation may allow them to reconsider not granting you a license.

Writing a Hardship Letter Driver License for Young Drivers

One situation in which you may not be able to have a driver license is if you are under 16 years old. While there is no way that you will be granted a license under the age of 14, those who are between 14 and 16 years old may be considered if they can demonstrate hardship. For instance, if you live remotely and you must look after your parents who are disabled, taking a school bus may be too time consuming. It would mean spending several hours per day traveling, hours that are needed to look after your parents. Without your help, they may start to experience undue hardship, not just financially but medically as well.

Writing a Hardship Letter Driver License After Conviction

The other situation in which you may want to write this type of hardship letter, is if your license has been taken away from you. Perhaps you have been convicted of a DUI or overspeeding. If losing your license would mean that you are no longer able to work, which would affect other members of your family, or if it means you can no longer properly look after your loved ones, causing them undue hardship, the DMV may consider the possibility of giving you a license.

Content of the Hardship Letter

In both situations, you must provide significant evidence to demonstrate the hardship caused by not having a license. You must also state that you will be willing to accept any conditions posed on your license. For instance, you may be required to have a vehicle that is fitted with a tracker, and agree to only drive at certain times, on certain routes, and never above a certain speed. If you are willing to meet those conditions, there is a chance that you will be allowed to have, or to retain, a driver license.

Some Advice in Writing the Hardship Letter

When writing a hardship letter, it is incredibly important to stick to facts. While you are in an emotional situation, and one that affects how you feel, the recipient of the letter is not interested in this. They want to know why you can’t have a license and how this affects you, and they want to see documents that prove this. Hence, make sure to keep your letter short and to the point and to attach any documented evidence. Try to make is just one page long, and make sure it is properly addressed and free from any grammatical or spelling errors. Do also send it via registered mail and keep a copy for yourself.

Hardship Letter Driver License Example

{Your Name}
{Your Address}
{Your Phone #}

{Date}

To Whom It May Concern:

I am writing this letter to apply for a Hardship License. I am {age 14-16} years old and need to drive for job purposes to help support my family.

I am a {grade} in high school and need to get from school to my job every afternoon. My parents work all day and I cannot catch a bus or walk to my place of employment because it is {number} miles from my school. My family situation is {specific dire financial circumstances} and my contribution to our finances is essential.

I understand that this license would be conditional. I would only use the vehicle with the license plate {number} on weekdays to get from {address} to {address} and {address} to {address}. The vehicle would only be in use between {time} and {time}.

I am attaching my application form as well as several character references that elaborate on my circumstances and attest to my responsibility and maturity.

Sincerely,

{Sender Name}

Writing A Hardship Letter Breaking Lease

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If you have signed a lease on a property, you will be contractually obliged to remain in that property for a set period of time. However, situations may change and they may force you to to break the lease. A situation of financial hardship may be accepted for this, although you will have to write a formal letter to your landlord.

Some Basic Guidelines in Writing the Hardship Letter

The said hardship letter is a formal business letter. This means it must be properly formatted and addressed. It must also not contain any grammar or spelling errors. The letter has to be factual, short, and to the point.

Indicate who you are and which unit you currently lease. Explain when your lease started, and state that there has been a significant change in your financial situation, which is forcing you to break your lease. State that you hope the landlord will agree to breaking the lease without charging you a monetary penalty for doing so.

Explain How Your Situation Has Changed

Discuss that particular change in your financial situation that is causing you to break your lease. Some commonly accepted reasons are divorce or separation, a failing business, death in the family, and sudden illness or disability. Specify your reasons and provide evidence through documents. Elucidate on how this situation has impacted your financially where you are no longer able to pay for the lease payments. Provide copies of your other bills as evidence of this.

Make a Goodwill Gesture

In order to appease your landlord, you may want to make a goodwill gesture. For instance, you can offer to help in finding a new tenant by advertising through your social media accounts. You could also suggest, if that is the case, that you already know someone who would be happy to sublet the property until the end of your lease arrangement. Subletting is usually not accepted under a lease arrangement, however, so make it clear that you have not set this in motion yet, but that you feel it could be a good opportunity to resolve the situation.

Should subletting not be an option for you or for your landlord, then you may need to request that the penalty associated with breaking the lease be waived. The nature of this penalty is detailed in your original lease arrangement. It is usually a number of months’ rent, which means that it can be quite substantial. You may need to explain, therefore, that the situation you are in has been completely unexpected and has already caused you some financially hardship, and that having to pay such a huge penalty would be impossible for you.

Ending the Letter

In ending the letter, make sure that your landlord understands that your situation is beyond your control, and that you are willing to resolve it in the best way possible. Remember to keep photocopies of your letter and that you send it by registered post. Do also follow up with your landlord if there has been no reply within one week.

Hardship Letter Breaking Lease Example

{Your Name}
{Your Address}
{Your Phone #}

{Date}

To Whom It May Concern:

I am the tenant living in {rental unit} at {address}. I have been residing there since {month, date}. I am writing because my financial situation has changed in recent weeks. I need to break my lease early, and I am hoping I can do so without monetary penalty.

My income has become significantly reduced recently, due to {sickness, death in the family, job loss, etc. Be specific}. The money I have remaining every month must go to {food, car payment, medication, etc.} and so I do not have enough left over to pay for rent.

I am happy to help advertise my apartment for another tenant, or to look for someone to sublet the unit until my lease is up. Since subletting is restricted in the tenant handbook, I wanted to check in with you on the proper procedure before taking that approach.

If subletting is not an option, I hope that there is a way that you can reduce or forgive the penalty for breaking the lease early. I am not trying to avoid my responsibilities, but these new circumstances have been both unexpected and financially devastating.

I apologize for any inconvenience this causes you and I look forward to speaking with you soon.

Sincerely,

{Sender Name}

Writing A Hardship Letter Auto Loan

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A hardship letter auto loan has to be properly written to maximize its chances of being successful. This means that it has to be formatted the right way, and that it includes the correct information. This will greatly increase the chances of the request being granted. The letter is a formal letter in which a creditor is requested by the letter writer to help financially by changing the terms and conditions of the loan. Some lenders have specific forms for this, which you should complete as well as sending the letter.

What to Include in Your Hardship Letter

In hardship letters, you have to clearly explain what is happening, without becoming emotive. It is about presenting the facts, rather than laying on the waterworks. Tell your lender if your income has been reduced, if you have lost your job, or if you have had unexpected expenses due to medical bills. Tell the lender what you have done to try and keep up with your bills, such as taking on a part time job or giving up on a gym membership. Do not tell your lender how all of that has made you feel, however, because that is irrelevant.

Key Tips in Writing a Hardship Letter Auto Loan

Naturally, you must make sure that the letter is addressed to the right person and that it is written in the right language, and is free from grammatical and spelling errors. Some key tips are mentioned below.

  1. Make sure that your letter is one page only.
  2. Include succinct, objective, and clear facts only.
  3. State that you wish to resolve the debt.
  4. Include all relevant documentation that proves your hardship and your efforts to turn it around.
  5. Thank your creditor for taking the time to read your letter and considering your request.

Things to Avoid When Writing a Hardship Letter Auto Loan

  1. Making your situation sound more dramatic than it is, or otherwise exaggerating your hardship.
  2. Lying or including any false claims, even if you believe they cannot be checked.
  3. Promising things that you cannot guarantee, such as catching up with missed payments by a certain date.
  4. Blaming your lender for the difficulty that you are now in.
  5. Writing an ultimatum, such as stating that you will claim bankruptcy if they don’t help you.

Remember that when the auto loan was provided to you, it was on the basis that you could afford it under your circumstances at that time. Whatever circumstances that have caused you to be in hardship right now, are not the fault of the lender. In fact, if at all possible, you should avoid placing blame at all. Do not use the word “because” in the hardship letter too often, in other words.

A final thing to remember is that you have to make sure that you take a photocopy of everything that you send to them, and that you use registered mail with receipt. Do also follow up after a week, to make sure that your letter has been received.

Auto Loan Hardship Letter Example

{Your Name}
{Your Address}
{Your Phone #}
{Your Loan #}

{Date}

To Whom It May Concern:

I am writing this letter because I am no longer able to meet the monthly payment for my car loan. I have currently paid {amount} of {total}. I am due to pay {amount} for the next {number} months. I cannot pay that amount, but I could pay {amount} over the next {number} months instead.

I am unable to make my payments on time because of a sudden financial crisis. In the last few weeks I have had to cope with {job loss, family member death, be specific}. I am working hard to get back on my feet, but if I am unable to reduce or extend my payment period then I will have to file for bankruptcy, which I am hoping to avoid.

I need my car for {job purposes} and am hoping to avoid repossession. I am attaching my financial documents such as {documents}, which should indicate the suddenness and seriousness of my situation.

I look forward to hearing from you soon so that we can work out an acceptable payment plan for the future.

Sincerely,

{Sender Name}