Why is my balance so high?

This is a very common question, and depending on how my different “tax periods” that you owe taxes for, the total balance can easily become very overwhelming. Like any other outstanding debt that you may have, such as a credit card or mortgage, your total balance will include interest and any applicable penalties caused by late or insufficient payments. These penalties can cause your balance to increase substantially, but just know that in many cases it is possible to get penalties removed or reduced by the IRS.