Tax Resolution | Tax Problems? Past or Present...

Tax Resolution | Tax Problems? Past or Present...
Has it been awhile since you filed a tax return?
• Feeling guilty? Scared?
• Don't know what to do or where to turn?
• Past Due Taxes are a Serious Problem!
• Do you even need to file? Yes.

Your first step to solving these problems is calling our office...
We will help you with the following:
• Settle your tax debt with the IRS for your reasonable collection potential (RCP)
• Handle all negotiations with the IRS for you
• Protect your paycheck and assets from the IRS
• Negotiate an affordable monthly payment plan to the IRS
• Discharge tax liens from your credit and property
• Negotiate with the IRS even if you have never filed a tax return!
• Prepare past due returns.

  

Volunteer

If you come forward and voluntarily file your missing tax returns, the system works more in your favor. Since nearly three out of four tax returns filed are due a refund, there is a good chance that the IRS might owe money to you. The only catch is that if you don't ask for your refund within three years, the IRS isn't going to give you what was yours in the first place. We are available to help you file your returns and, if necessary, act as your representative before the IRS. We work for you, not the IRS. Sometimes things just happen. If there is a good reason for not filing a tax return, some of the penalties can be reduced. Generally, if the IRS owes you a refund there are no penalties at all.

Scared of Volunteering?
If the IRS decides to come looking for you, life can become very difficult and frequently embarrassing. There is a chance that your employer might be requested to send part of your paycheck to the IRS instead of handing your paycheck to you. Your bank account could be frozen or even seized. A lien could be placed on your house. In the worst case, you could face criminal prosecution.  

What if you owe money?

Installment Agreements -- If you can pay the full amount within five years, you should be able to set up a monthly payment plan and make regular installment payments.  The IRS is now accepting Partial Payment Installment Agreement (PPIA).

What if you owe a lot of money?
Offer in Compromise -- If you owe so much money that you will never be able to pay your tax liability, we may be able to work out a compromise where the IRS will accept less than you actually owe. If the IRS accepts your Offer-in-Compromise (OIC), your total tax liability including interest and penalty is considered paid in full. An OIC is a mathematical formula, NOT an amnesty program. Professional assistance is strongly recommended when compromising a tax liability. 

Professional assistance

Don't be afraid to ask for help. By law, you have the right to professional representation. Only an Enrolled Agent, certified public accountant or attorney can represent your case before an IRS Collections Officer. Remember, your representative is working for you.

The IRS has ten (10) years from the date of a tax assessment to collect a debt from the taxpayer.

• The date the collection statute expires is called the Collection Statute Expiration Date or CSED.  IRC §6502 provides that the length of period for collection after assessment of a tax liability is ten years. 
• When the CSED date passes, the IRS is barred from attempting to collect your tax debt unless you waive the enforcement of the statute.

• When Does the Collection Statute Start to Run?
  • The statute starts on the day an IRS assessment is made.
  • Generally, the dates of assessment are as follows:
    • Filed tax returns – The date you mailed the tax return plus six weeks.
    • Audit Adjustments (agreed) – The date you signed the auditor’s report plus three weeks.
    • Audit Adjustments (unagreed) – The date the appeals process and the tax court process (if any) is completed and the tax court judge has issued his or her ruling.

• What Will Cause the Collection Statute to be Extended?
  • The Collection Statute can be extended (tolled) by one or more of the following acts or situations:
    • The filing of a bankruptcy petition - The statute is extended for duration of the bankruptcy proceedings.
    • The filing of an Offer in Compromise - The statute is extended for duration of the Offer or one year, whichever is greater.
    • The filing of requests for relief – The statute is extended when a taxpayer files for a Collection Due Process (CDP) hearing, Innocent Spouse Relief and any other form of relief that requires the IRS to suspend collection enforcement while it reviews the validity of the underlying assessment.
    • The signing of a waiver extending the statute - The statute is extended to date indicated in signed waiver. Never sign a statute extension without first consulting your tax advisor.
    • The taxpayer is out of IRS jurisdiction – The statute is extended for duration taxpayer was out of IRS jurisdiction.

• Example:  10-year period begins to run with the date of the “assessment,” not the tax year for which taxes are due. For example, if the return for 2005 is not filed until 2008 and the tax is assessed in 2009, the 10-year period begins to run in 2009 and expires in 2019.  Ten years is not always the limit. There are a number of other ways the 10-year collection period may be extended. For example, during the period an Offer in Compromise is pending, the statute of limitations is extended accordingly. Similarly, if bankruptcy is declared, while the bankruptcy proceeding is pending, the 10-year statute of limitations on collection is extended by the duration of the bankruptcy proceeding.

• Many types of court actions may also suspend the running of the 10 years. The filing of an IRS levy or a judgment entered in a Federal Court in a suit by the Department of Justice can also extend the 10-year period. The IRS can ask the Department of Justice to institute a collection proceeding in Federal District Court. If such a proceeding is begun and the United States Government prevails, then the statute of limitations on collection on that judgment is extended for the period generally allowed to collect such judgments, and such judgments can be renewed subject to the discretion of the Court.

• If the tax return was prepared by the IRS (Substitute For Return - SFR) under the authority of IRC §6020(b) the statute of limitations on assessment and collection shall not apply. IRC §6501(b)(3) Rev. Reg. §301.6501(b)-1(c).

• What options are available to me to solve my tax problems?
  Among services we offer:
  • Currently Not Collectible (CNC) - When the taxpayer cannot afford to pay the IRS monies due to a lack of assets and low income or no income (e.g. recently laid off due to current economy, divorce, illness) then the IRS will deem the taxpayer Currently Not Collectible (CNC) (Code 53) and agree that their tax liability will be suspended for the time being.  
  • Installment Agreement (IRC §6159) - A monthly payment plan set up to pay back the taxpayer's tax liability. The IRS has guidelines as to what amount they will accept and the time frame they will accept it in (usually sixty months). A financial affidavit (Form 433-A) is required from the taxpayer before the we can negotiate an installment agreement.   Under an installment plan, you make monthly payments on your tax debt for up to five years.  This is something you can do on your own.  The IRS fee to set up an installment plan is $105, or $52 if you agree to have payments automatically debited from your bank account. Approval is automatic for taxpayers who owe $10,000 or less and are in good standing with the IRS.
  • Offer in Compromise (IRC §7122) (We do legitimate offers!) - An offer to the IRS to lower the total tax liability owed by the taxpayer due to financial constraints. This is a very popular solution advertised on TV.  Under the offer program, the IRS agrees to accept less than you owe.  But to obtain a permanent reduction in your tax debt, it's not enough to show the IRS that you can't pay your tax bill.  You must also prove you've exhausted all of your financial resources and have little hope of raising money in the future.
  • Penalty Abatement - The IRS assesses penalties and interest on tax liabilities so over time taxes due years ago can increase from hundreds to thousands of dollars. The IRS will sometimes lower or eliminate these fees with a well worded request.  The IRS won't grant penalty abatement without reasonable cause.  For example, a widow who filed her tax return late because her husband died shortly before April 15 might qualify for penalty abatement.  If you believe you can show extenuating circumstances, you can apply on your own or ask your tax preparer to file a request on your behalf.  
  • Bank Levies/Wage Garnishment Release - The IRS will collect their monies due by any means necessary. They may take all your assets with a levy or garnish up to 70% or your wages.  We can negotiate with the IRS to have these released in as little as 4 business days.
  • Audit Representation - If you are currently being audited and you don't know why, it is very important to be represented by a tax professional who can get to the bottom of the problems and fix them. We can have your past audit reopened if you feel you did not get a fair shake.

I have unfiled taxes from previous years but no longer have my records from those years. Can you help me?

We can prepare your past unfiled tax returns by requesting your IRS wage transcripts and completing a tax questionnaire. Six (6) year filing requirement for past-due returns per IRM 4.12.1.

Is there anything I need to do before I can solve my tax problems?

Before the IRS will accept any negotiations to solve your tax liability you will need to be in compliance with any unfiled tax returns. Any unfiled taxes up to ten years ago may be required to be prepared and filed with the IRS.

If you owe the IRS money, you have options:

• Talk to a enrolled agent who has experience dealing with IRS collection issues. If you already have a tax preparer, he or she may be able to help you or refer you to someone who can.
• If you can't afford to hire a tax professional, you may qualify for a Low-Income Tax Clinic. 
• If you have tried unsuccessfully to resolve your problems with the IRS, you may be able to get help from the Taxpayer Advocate's office. For more information, go to IRS Taxpayer Advocate, or call 877-777-4778.