Orange County Accountant » Offer In Compromise

Irs Settlement – Can You Really Settle Your Irs Tax Debt for Less?

admin — Sat, 16 Jan 2010 13:51:19 +0000

It’s possible to settle your IRS tax debt, but it presents a challenge. Proving you can settle your tax debt for less is a daunting experience. You have to contend with pages of IRS paperwork rife with technical terms. Settling tax debt is indeed a reality and it can be done. However, there’s a lot you need to know before you attempt to settle your IRS tax debt.

Rebuking the Lies – There are many rumors about settling IRS tax debt all over the web. While it is true that some people have settled their IRS debt for extremely low amounts, only a small percentage of people can qualify for very low IRS settlement offers. And only people who display desperate situations can have their IRS debt settled for “pennies on the dollar.”

Another misconception is that you can choose any IRS settlement amount and the IRS will approve it. It’s not that simple. In fact, it’s not simple at all. You have to submit Form 656 Offer in Compromise. You will have to detail your entire financial situation to the IRS. They will determine if the offer you send is fair or not, based on your income and assets. If your income and assets exceed the amount of your offer, your offer will be denied.

The Benefits of Settling Your Tax Debt – The first and obvious benefit of settling your IRS tax debt is saving money. IRS tax debt settlements have the potential to save you thousands of dollars. Secondly, IRS settlements quickly take care of your tax debt. When you choose to pay your IRS debt in monthly payments, penalties and interest continue to accrue on the account. But when you actually settle your IRS tax debt, the tax debt does not continue to grow. It is paid off in a “lump sum”. By comparison, paying monthly will make you feel like there’s no end to your tax debt problem.

Qualifying for IRS Settlement – Not everyone will qualify to settle their IRS tax debt. The IRS is going to weigh your finances very carefully. They need to know your gross income amount. Next they will look at the amount of money in your bank account, and the value of every single asset you own. If any of these amounts are the same or exceed your total IRS tax debt, you will not be approved for an IRS settlement.

Applying for an IRS Tax Debt Settlement – In order to “apply” for an IRS tax debt settlement, you need to file Form 656 Offer in Compromise. It will help you to include any documents supporting why you need IRS settlement. You can show them your income has dropped significantly, or that you’ve lost your assets, or anything else pertinent to your “desperate situation”.

You must double check to make sure you have filled out everything as fully as possible and signed the form. Leave nothing blank. If you make a mistake, your IRS settlement will be denied. You have to include a 20% settlement with your offer. So make sure you do it right, because the money is non-refundable. There is much riding on proper completion of Form 656 and the completeness of your supporting documents!

Getting Professional Help – You can try to fight the IRS “toe to toe” without any help. But you are not likely to succeed. There are too many laws and regulations that ordinary taxpayers simply are not aware of. So where do you start when it comes to settling your IRS tax debt? The best solution is a simple one. Consult with an IRS tax professional that will negotiate with the IRS for you. Having a tax professional on your side greatly improves your chances of winning and ultimately being approved for the IRS settlement!

Liv Worthington has worked in the debt management field for many years. She also offers advice on IRS tax debt for taxpayers who’ve heard you can settle your IRS tax debt for less than you owe through IRS settlement and the Offer in Compromise program.

Irs Tax Debt Settlement Help – When You Need Expert Tax Debt Help

admin — Fri, 15 Jan 2010 14:33:40 +0000

With the recent downturn in the economy, Americans find themselves not only facing unsecured credit card debt problems, and difficulties handling their home and vehicle loans, but oftentimes unable to pay their IRS taxes in a timely manner. There is IRS tax debt help available to anyone who finds they owe money for back income taxes to the Internal Revenue Service. The federal government offers many tax relief programs that are designed to help the taxpayer repay the delinquent IRS tax debt due. But if you are a struggling taxpayer with a large IRS tax debt, then repaying the full IRS back tax debt may not be an option for you and your family. In fact, it may seem like an insurmountable financial hurdle you will never be able to overcome. That is why there is an IRS tax relief program called Offer in Compromise.Federal law does grant the IRS the power to agree to a settlement of your IRS tax debt for less than the actual amount you owe. Sometimes, the IRS can accept significantly less to end your IRS tax debt. However, the process of actually getting the IRS to agree to a tax settlement is not simple or straightforward. You may need expert IRS tax debt settlement help to insure that you have filed everything correctly and that you give yourself the very best chance to be approved for a reduced tax debt settlement offer. The IRS does not widely promote this program and it is not a full amnesty program. It is however, a way to significantly reduce your IRS tax debt, and have the “compromised amount” be considered payment in full for the IRS back tax liability. It is as close as you can get to a “fresh start” with the IRS!Knowing when it is prudent to seek professional IRS tax debt settlement help can be crucial to your success. The paperwork for the IRS tax debt settlement program is complicated. You are required to prove that you will never be able to pay back the entire tax debt, or that paying off your tax debt will cause “undue hardship”. You must commit to a full financial disclosure. The IRS looks at your income and all your “lifestyle expenses”. They even require an inventory of all your accounts, possessions, and the equity in your home. Getting approved can be a lengthy process and there are no guarantees you will quality for this form of IRS tax relief. The process can take up to a year. Having professional tax debt help can “make the difference” between success and failure. You simply cannot be expected to know all the complexities of the IRS settlement process to insure your tax debt settlement offer is accepted. But IRS tax relief professionals can give you this “much needed edge”.There are a number of companies that are able to provide delinquent taxpayers with the IRS tax debt settlement help they need. Some of these firms are actually tax law firms, while some are companies with tax specialists that assist with IRS back taxes. These firms are typically staffed with tax attorneys, enrolled agents, CPAs, and even previous IRS employees who have the “inside track” on how to successfully secure a tax debt settlement offer from the IRS. These companies will offer a free tax analysis which allows you to have your tax matter reviewed at no initial cost. These tax firms are also aware of all other IRS tax relief programs available should it not appear that you are likely to quality for tax debt settlement through the Offer in Compromise program. It is always advisable to check the record of any professional tax debt help firm or company you intend to contract with to handle your IRS tax debt problem. It goes without saying that successful resolution of your IRS tax debt is important!

Liv Worthington has worked in debt management for many years. She takes pride in helping her clients also find IRS tax debt settlement help when they need IRS tax relief and expert tax debt help for IRS back taxes.

Overwhelmed with IRS Tax Debt? Need IRS Tax Relief? IRS Offer in Compromise

admin — Thu, 14 Jan 2010 14:13:45 +0000

IRS OFFER IN COMPROMISE – IRS TAX SETTLEMENT – IRS TAX RELIEF

An IRS Offer in Compromise ( also known as an OIC ) is an excellent way to settle your IRS Tax Debt with the IRS for much LESS money than what you currently owe. This Settlement of IRS Taxes

Irs Offer in Compromise – Can it Solve Your Irs Tax Debt Problems?

admin — Wed, 13 Jan 2010 13:42:55 +0000

Taking on IRS tax debt is a daunting task that presents many confusing issues. The majority of taxpayers are aware of the option to pay their IRS tax debt in full or pay the tax debt in monthly payments or installments. But there is another option, the IRS “Offer in Compromise.” Knowing the steps to success with an IRS Offer in Compromise, also commonly called IRS tax settlement is important, because if your offer is approved you can save thousands of dollars! It can play a critical role in the financial future of any delinquent taxpayer, impacting not only the taxpayer individually, but the financial health and welfare of their family’s future. Settling Your IRS Tax Debt: In a nutshell, an “Offer in Compromise” is an IRS tax settlement. If you qualify for an offer, you can have your IRS tax debt greatly reduced. However, it’s not easy to qualify for an offer. The IRS will weigh your entire financial situation. If the IRS determines you don’t have enough income to satisfy your debt in full, your offer may be approved. It is your job to prove you can’t pay your IRS tax debt in full, so make sure you do your IRS research thoroughly. Insider Tip: It’s notoriously hard to have your IRS tax settlement approved, regardless of “how simply or straight forward it may sound.” But there is a secret way to crack the IRS’s code. The IRS has three ways of determining if you qualify for an Offer in Compromise/IRS tax settlement. The Factors: The IRS may accept the offer based on any of the following:> Doubt as to Collectability: If you know you cannot pay your IRS tax debt in full, you may qualify. Remember, if you have assets that could be sold to satisfy your debt these must be considered when you make your offer to the IRS. > Doubt as to Liability: If you think the debt liability does not fall to you, you’re a good candidate for an offer in compromise. But your reasons must be legitimate. Here are three legitimate reasons listed on the official IRS website:(1) the examiner made a mistake interpreting the law(2) the examiner failed to consider the taxpayer’s evidence or(3) the taxpayer has new evidence. IRS Tax Specialists: Expert IRS tax advisors may give you the edge you need to get your IRS tax settlement approved. Even with some insider knowledge, getting your Offer in Compromise approved by the IRS is difficult to achieve. That’s where IRS tax specialists come in. Tax specialists employ or include Tax Attorneys and Enrolled Agents. IRS tax specialists are experienced in all tax debt issues and know exactly what you qualify for, and how to help you get your Offer approved. They can make the difference in achieving an accepted offer. It’s Just The Start of Your Road to Recovery: Getting your offer in compromise approved is only the beginning of your road to recovery. When your tax debt settlement is approved you are entering a 5 year contract with the IRS. This “contract” means you have to file your taxes on time for five consecutive years. If you default on a payment or fail to file properly and timely, the IRS can charge you the original tax debt amount plus penalties and interest.

Liv Worthington has worked in the debt management field for many years. She also advises clients IRS tax debt who need an Offer in Compromise or IRS tax settlement solution to their tax problem.

Irs Debt Help: 5 Options To Getting Rid Of Tax Debt

admin — Wed, 06 Jan 2010 13:33:36 +0000

IRS Debt Help:
Do you owe the IRS? Are you struggling with IRS debts and cannot figure out what to do? Don’t despair, you are not alone. Many Americans owe back taxes, or cannot afford to pay their IRS debts. If you want to get IRS debt help, it’s important to understand the different IRS tax debt strategies.
There are five strategies for getting out of IRS tax debt.
1.Offer in Compromise: a program where you can settle your tax debts for less than what you owe. Requires making a lump sum or short term payment plan to pay off the IRS at a reduced dollar amount.
2.Installment agreement: a monthly payment plan for paying off the IRS.
3.Partial payment installment agreement: a somewhat new debt management program where you have a long term payment plan to pay off the IRS at a reduced dollar amount.
4.Not currently collectible: a program where the IRS voluntarily agrees not to collect on the tax debt for a year or so.
5.Filing bankruptcy: discharge your tax debts under the strict rules of a Chapter 7 or 13 bankruptcy petition.
Offer in Compromise
Many people who find themselves in debt to the IRS might focus on the first option above – the Offer in Compromise (”OIC”). For those who qualify it can be the optimal solution, however, it is important to note that not everyone qualifies for the Offer in Compromise solution. Only about 15% of applicants succeed in reducing their debts through the OIC program. For this reason and because of the complexity of filing an Offer in Compromise many people enlist the services of a Tax Professional who has a track record of success negotiating with the IRS. This Tax Professional will not only be able to determine if you are eligible to reduce your IRS debts via an OIC but they will also assist you in navigating the complicated IRS bureaucracy to achieve the desired outcome.
An Offer in Compromise is a lengthy and time-consuming process. It takes most individuals anywhere from 12 months to 24 months to achieve a successful resolution on your offer application. Through an Offer in Compromise, taxpayers agree to pay the IRS only the reasonable collection potential instead of the full amount of taxes owed. For some people the “reasonable collection potential” will be less than the full amount of taxes owed – sometimes as little as 10%.
Installment Agreement
Many taxpayers cannot qualify for an Offer in Compromise, Statute of Limitations expiration, or bankruptcy relief but still seek resolution for their IRS liability. In these cases, it may be possible to negotiate long term IRS payment arrangements. The IRS allows “structuring” five primary types of payment plans, or Installment Agreements: Guaranteed Installment Agreements, Streamlined Installment Agreements, In-Business Trust Fund Agreements, Long-Term Installment Agreements, and Installment Agreements on Specified Balance Due Accounts.
Currently Not Collectible
If a taxpayer does not qualify for an offer in compromise and cannot afford to pay an Installment Agreement, Currently not Collectible (CNC) status may be an option. If a client is placed in CNC status, the statute of limitations continues to run and the IRS will not pursue collection actions. However, if a taxpayer’s financial status improves, the IRS can remove the file from CNC status and return to active collection status.
Reasons for attempting CNC status:
1. Taxpayer has income below allowable expenses and there is no indication that the financial situation will improve in the future;
2. Due to high equity, the taxpayer does not qualify for an OIC and has more allowable expenses than income so an Installment Agreement is not an option; and,
3. Taxpayer has more allowable expenses than income and the statute of limitations is getting close to expiring.
Statute of Limitation for IRS Tax Debt
The IRS has 10 years to collect outstanding tax liabilities. This is measured from the day a tax liability has been finalized. A tax liability can be finalized in a number of ways. It could be a balance due on a tax return, an assessment from an audit, or a proposed assessment that has become final. From that day, the IRS has ten years to collect the full amount, plus any penalties and interest. If the IRS doesn’t collect the full amount in the 10-year period, then the remaining balance on the account disappears forever. The statute of limitations on collecting the tax has expired.
Selecting a Tax Professional to handle your IRS Tax Debts
Because of the complexity of the Offer in Compromise and other IRS tax debt processes, many taxpayers hire a tax professional to prepare their IRS documentation and to negotiate directly with the IRS. Tax professionals charge anywhere from $1,500 to $6,000 or more for accurate and thorough IRS representation. Because most of the IRS tax debt solutions involve negotiating with the IRS, your tax professional should be admitted to practice before the IRS. You should be looking for a Tax Attorney, an Enrolled Agent (EA), or a Certified Public Accountant (CPA) to handle your Offer in Compromise. The tax professional must know about the laws governing IRS collection of tax debts, how the IRS evaluates offers, and what all the options are for resolving tax debt problems. “Taxpayers should be looking for a tax professional with years of experience in IRS collection matters, especially experience in dealing with revenue officers, the Automated Collection Systems division, and the complex IRS process” according to Jim Brown, the managing tax attorney with Freedom Tax Relief.
Please be aware that even the most successful tax professionals have lost Offer in Compromise cases, so not every consumer looking for IRS debt help is guaranteed the most savings. It is important to know that your Offer in Compromise will be decided based on your unique financial situation. If you do need IRS debt help, having a tax professional represent you before the IRS will help ensure that all letters and phone calls from the IRS are handled quickly and professionally. But in the end, it is up to the IRS to make a decision about your case.
It is important to know that like death and taxes, your IRS tax debt issue will not simply vanish, so you should seek help before the IRS escalates collection efforts and/or you accrue additional penalties and interest.

Brad Stroh is currently co-CEO of Freedom Financial Network and Bills.com. If you would like more of Brad’s articles, please visit the Bills.com information on Credit.

Irs Tax Relief – the Most Popular Irs Tax Relief Solutions

admin — Sun, 03 Jan 2010 13:41:59 +0000

Tax law provides many solutions for resolving tax debt. But if you were to contact the IRS directly, they would only alert you to one solution, and that’s paying the tax debt in full. Here are five popular IRS tax relief solutions you should know about to be more informed.

IRS Tax Settlement

It is possible to settle your IRS tax debt. But there are some pitfalls you need to know. First, take a good look at your assets and finances. If you have assets that can be sold to satisfy your tax debt or enough money in your bank account to pay the tax debt in full, you will not be approved for an Offer in Compromise (IRS Tax Settlement). Do not waste the money or effort if either scenario applies to your financial situation.

After you’ve determined that you have a chance at settling your IRS debt, you will need to fill out Form 656 “Offer in Compromise.” Make sure you fill out every single space, leave nothing out. Make sure to sign the paperwork, as this is a common mistake people make when they submit their own forms. You do not want your tax settlement offer rejected due to simple mistakes because you will have to submit 20% of your offer along with the forms. If your offer is rejected, this money is non-refundable.

You must also keep some common IRS tax settlement roadblocks in mind before you submit your offer. First, are you up to date with filing your taxes? If you are not, your offer will be rejected. The second issue is bankruptcy. If the IRS finds out that you have filed for bankruptcy at or around the same time you submitted your Offer in Compromise, your tax settlement offer will be denied. Finally, you need to remember that an IRS tax lien will not be removed when you submit your offer. Tax liens, with few exceptions, are only released when the tax debt is completely satisfied. The tax lien will remain until after your tax debt is paid off.

Getting an IRS Tax Levy Released

The IRS Tax Levy is a fierce weapon the IRS uses to collect on tax debt. If you do not reply to the IRS’s correspondence requesting payment, chances are high the IRS will use a tax lien or a tax levy on you. However, there are a couple of IRS tax relief solutions to try to get your IRS wage or bank levy stopped.

IRS Bank Levy

The IRS will send you a notice stating they intend to levy your bank account. You bank account is now frozen. After the notice you have only 21 days before the IRS seizes your money for good. Working fast is imperative. If you set up an installment agreement or make any kind of good faith payment before the 21 days are up, you can save the money that is in your bank account, and avoid the impact of the IRS tax levy.

· IRS Wage Levy

If you ignore your tax debt long enough, the IRS can implement a wage levy against you. This means the IRS will remove a set amount from your paycheck until your tax debt is paid in full. It is not unusual for the IRS to take up to 75% of your paycheck, leaving you a minimal amount to meet your own monthly financial obligations. You are certainly in need of IRS tax relief if you are the victim of the IRS wage garnishment. The IRS wage levy can also be released or “lifted” but seeking expert IRS tax help may be prudent as each pay period that passes creates more financial damage.

Installment Agreement

You can make monthly payments on your IRS tax debt. The IRS will calculate your income and assets when you file Form 9456. After the IRS determines you qualify, they will set the amount you can pay each month to pay off your tax debt. When you are approved, you must make sure not to default on your monthly payments. Your plan will be canceled and you will not qualify for another installment agreement for six months to one year. The monthly installment agreement is the most common IRS tax relief solution for payment of back tax debts. As you can see, the IRS provides many solutions for taking care of common tax problems. You have to act fast and make sure you respond to any notices you receive from the IRS as soon as possible. The IRS will not and can not be ignored.

When Negotiations Fail

Most people who call the IRS directly have trouble communicating with the IRS. The IRS is trained to collect money no matter what, so having them release your IRS tax levy is nearly impossible for the ordinary taxpayer. When levies are being implemented, time is limited. It’s a good idea to hire a tax care professional that can negotiate with the IRS for you, on your behalf. That will improve your chances at an IRS tax relief solution that is workable for you!

Liv Worthington has worked in the debt management field for many years. She also offers advice on IRS tax relief for taxpayers in distress who’ve heard about tax settlement or who are the victims of an IRS tax levy and need urgent help.

How To Settle Your Tax Debt By Negotiating A Payment Plan With The Irs: What You Need To Know If You Can’T Afford To Pay Your Tax Bill

admin — Sat, 26 Dec 2009 15:09:48 +0000

Qualify for an IRS Installment Agreement and Save Money by Negotiating the Lowest Possible Monthly Payments

IRS Announces Unprecedented Opportunity for Recession-Burdened Americans to Settle Outstanding Tax Debts

Struggling taxpayers may be eligible for tax breaks as the IRS eases enforcement and collection efforts to help Americans in financial distress. Because of the extraordinary challenges of today’s economy, the IRS is pledging to be more forgiving of Americans who have fallen behind on their taxes due to unusual financial hardship.

And one way you can settle your back taxes is by negotiating an Installment Agreement with the government that that allows you to pay liabilities over time.

If you cannot afford to make monthly payments and don’t qualify for another type of tax relief, such as an offer in compromise, there are other options including negotiating that your account be placed in a “currently not collectible” status so that you will not be required to make payments and the IRS will not pursue collection action.

What is an IRS Installment Agreement?

An Installment Agreement is a payment arrangement whereby the government allows a taxpayer to pay liabilities over time. Once a payment plan is established, the IRS will not take enforced collection action, including the levy of bank accounts or wages, as long as the taxpayer remains current with all filing and payment obligations. However, interest and penalties would continue to accrue until the outstanding balance is satisfied. Additionally, a tax lien may be filed as part of the terms of the installment payment agreement, depending on the amount of the total liability.

How to Negotiate an IRS Installment Agreement and Set Up a Payment Plan for Your Tax Debt

The IRS encourages taxpayers to pay what they owe as quickly as possible. For those individuals or businesses not able to resolve a tax debt immediately, an installment agreement can be a reasonable payment option. Installment agreements allow for the full payment of the tax debt in smaller, more manageable amounts.

In most cases, the IRS will accept some type of payment arrangement for past due taxes. In order to qualify for a payment plan with the IRS you must meet the following rules and provide the IRS with this information:

* You must have filed all tax returns (It’s OK to owe money but you must file).

* You will need to disclose all assets owned including all cash and bank accounts.

* You must not have adequate cash available in a checking, savings, money market, or brokerage account to pay the IRS.

* You must not have the capacity to borrow the amount owed to the IRS from other sources (i.e., a second mortgage on your home).

* You must not have adequate equity in a retirement account from which you can borrow or liquidate; for example, IRA’s or 401K’s.

The total dollar amount you owe usually dictates with whom the negotiations will be handled.

* Typically, IRS Revenue Officers are not involved in cases where the amounts owed are less than $25,000.

* The IRS will ask you to complete a personal financial statement and if a business is involved, you will also need a business financial statement.

* The IRS has determined allowable monthly expenses for individuals, which will be matched against your actual monthly expenses.

* The difference between your monthly income and your allowable monthly expenses will be the amount that the IRS will require you to pay on a monthly basis.

These monthly payments will continue until your outstanding tax liabilities are paid in full.

What the IRS May Not Tell You About Payment Plans

It is important to note that the IRS continues to add penalties and interest while you are making monthly payments. This may cause you to be paying what you consider a large monthly payment to the IRS and your outstanding balance may in fact be increasing due to additional penalties and interest.

The IRS may not explain this to you! So be careful!

Additionally, for taxpayers that enter into an installment agreement, the IRS may require a signed waiver to extend the time IRS can collect. While it is always in the best interest of the IRS to get a signed waiver, it may not be in the taxpayer’s best interest. If you are asked to sign a waiver, protect your rights, seek the advice of a tax resolution expert first.

The IRS in most cases, to protect their interest, will file a Notice of Federal Tax Lien, with the County Recorder’s office in the county you reside. This will inevitably be reflected on your credit report decimating your credit (FICO) score. In addition a recorded Federal Tax Lien means the IRS has a monetary interest (claim) against all real and personal property owned (at time of filing) and any and all real or personal property acquired in the future while the lien is in effect. Generally, the lien is effective throughout the 10 year Collection Statute of Limitations.

The Benefits of Hiring Professional Tax Representation to Negotiate your IRS Payment Plan

Whether the IRS demands full payment up-front or a payment plan that is substantially higher than what you can afford to pay, a professional tax resolution specialist can help you negotiate an arrangement for the lowest possible monthly payment and also provide you with various options for making those payments.

Additionally, if you owe more than $10,000 to the IRS, you will be required to provide full financial disclosure and you will need to hire specialized tax representation to negotiate on your behalf with the IRS.

IRS Pledges Greater Flexibility to Help Distressed Taxpayers

Although the IRS is pledging to be kinder and gentler to taxpayers in these challenging times, you will still need to meet your installment payment requirements. However, the IRS has announced that they will try to be more flexible with taxpayers who miss an installment payment.

“We need to ensure that we balance our responsibility to enforce the law with the economic realities facing many American citizens today,” IRS Commissioner Douglas Shulman said. “We want to go the extra mile to help taxpayers, especially those who’ve done the right thing in the past and are facing unusual hardships.”

If a taxpayer with an existing installment agreement is worried about missing a payment because of a job loss or other financial hardship, Shulman has assured the public that a missed payment will no longer lead to an automatic end to that agreement.

Additionally, the IRS has announced that it is more likely to forgive a missed payment and they’ve instructed staff to not automatically default someone who is having trouble.

Frequently Asked Questions about IRS Payment Plans

What do you have to do to be eligible for an installment agreement?

To be eligible for an installment agreement, all returns that are due must first be filed.

What are the payment terms?

Installment agreements generally require equal monthly payments. The amount of an installment payment will be based on the amount owed and on the taxpayer’s ability to pay that amount within the time legally available for the IRS to collect. By law, the IRS has the authority to collect outstanding federal taxes for ten years from the date of assessment.

What are the conditions of an installment agreement?

As a condition of an installment agreement, any refund due in a future year will be applied against the amount owed. Therefore, taxpayers may not get all of their refund if they owe certain past-due amounts, such as federal tax, state tax, a student loan, or child support. The IRS will automatically apply the refund to the taxes owed. If the refund does not take care of the tax debt, then the installment agreement continues until all of the terms are met.

Does interest stop with an installment agreement?

Interest does not stop accruing until the entire obligation is paid. An installment agreement is more costly than paying all the taxes owed now. Penalties and interest continue to be charged on the unpaid portion of the debt throughout the duration of an installment agreement.

Are there fees to set up an installment agreement?

The IRS charges a user fee of $43 to set up the installment agreement. And it is possible for an installment agreement to be reinstated if the agreement defaults.

Also, installment agreements may be restructured to include additional amounts owed in one agreement. Reinstating or restructuring an existing installment agreement will cost an additional $24 user fee.

What are enforced collection actions?

Generally, IRS enforced collection actions (levy against personal or real property) are not made while an installment agreement request is being considered, or:

While an agreement is in effect,

* For 30 days after a request for an agreement has been rejected, and

* For any period while a timely appeal of the rejection or termination is being evaluated by the IRS.

Can my installment agreement be defaulted?

Yes. Failure to make timely payments can default the agreement. A defaulted installment agreement could subject a taxpayer’s account to enforced collection action and potentially have a negative effect on a taxpayer’s credit standing.

What is an annual statement of balance due?

In accordance with the law, installment agreement taxpayers receive an annual statement from the IRS. The statement provides the amount owed at the beginning of the statement period, the payments (credits) posted to account(s), any fees or assessments, and the ending balance. Currently, the annual statement is sent each year in July.

For more information on negotiating an IRS Installment Agreement or to get professional tax advice on reducing your IRS debt, visit www.taxresolution.com for a free tax relief consultation or call 866-477-7762.

Michael Rozbruch is one of the nation’s leading tax experts. A Certified Tax Resolution Specialist (CTRS), licensed CPA in the state of Maryland and the founder of Tax Resolution Services (http://www.taxresolution.com/), he helps individuals and small businesses solve their IRS problems and is dedicated to educating the public on tax planning and other strategies for managing their personal and business finances.

Michael Rozbruch is one of the nation’s leading tax experts. A Certified Tax Resolution Specialist (CTRS), licensed CPA and the founder of Tax Resolution Services. He helps individuals and small businesses solve their IRS problems and is dedicated to educating the public on tax planning and other strategies for managing their personal and business finances.

You and an Irs Tax Debt: Don’t be Afraid

admin — Sat, 19 Dec 2009 15:16:01 +0000

What happened? You’ve filed your taxes and you’re in trouble. Maybe you filed yourself or you went to one of those companies that file your taxes for your. After finishing everything you find out you owe money! You recheck your math and deductions once, twice, three times and…you really are in debt to the IRS! It’s understandable that you’re mad as hell or you want to start crying, but the IRS-Hitman has some advice.

Don’t panic…don’t ignore the debt, and do file the return. You can try to put off the debt by requesting an extension; October 15th is the latest you can put it off. This could give you a chance to come up with the money that you owe by then. But you do have to file, and the longer you wait the harder the debt will be to deal with.

Depending on how much you owe, you can try to deal with the IRS on your own, or you can seek professional tax help. The first thing you need to do however is to jump on the problem immediately! Do not wait.

Can I bury my head in the sand? I recommend against this. What happens if you wait? First of all the IRS starts sending you letters telling you how much you owe, and asks that you contact them to setup arrangements. If you don’t respond to the IRS then…well, things can get real bad real fast for you. The IRS can seize your wages, seize you bank account, or any other accounts you have. They can also put a levy on your home. That’s why taking immediate action is so important.

But wait… There are options available to you. You want to take action, but you have no way to pay the debt in full. Most people can’t pay their IRS debt in full, and usually it’s over $1,000. Not too many people have that kind of money lying around.

• Setup a payment plan with the IRS.

• Apply for an Offer in Compromise. This can reduce your debt to pennies on the dollar. Beware however, this is very difficult to get, and the IRS frequently denies applicants.

• Apply for Currently Not Collectible status. Again this is very difficult as you have to prove to the IRS that you are living at the bare minimum.

Choose wisely…However you choose to deal with your IRS tax debt is up to you. The key is to make a choice, and not to bury your head in the sand. Just because you don’t see an IRS-Hitman doesn’t mean he doesn’t have you in his sights.

Now you have the smoking gun…Use it!

Richard Close was an IRS-Hitman. He took out anyone who owed the IRS money as his father had before him. Now he helps thousands of Americans beat Uncle Sam and save thousands of dollars. Tax problems? Contact him and get free tips and techniques to deal with wage and bank seizures and slash tax debt: email at irs-hitman@taxdefensenetwork.com or call 1-888-248-9058. Visit http://irs-hitman.blogspot.com or www.taxdefensenetwork.com

Irs Tax Debt and Missing Tax Returns: Double Trouble

admin — Fri, 18 Dec 2009 13:35:36 +0000

Double your pleasure?Owing the IRS money is a hard thing to deal with. There can?t be anything much worse?right? Well you could owe the IRS money and have un-filed tax returns. How can it be worse you ask? Aren?t the un-filed returns included in the debt? You have to be compliant. When you?re in debt to the IRS you do have some options to deal with that debt. Whether you want to setup a monthly payment plan, or try to settle your debt with an Offer in Compromise. Un-filed tax years put a big red stop sign in front of any negotiation efforts. Why? You?re not in compliance with the IRS. Compliance means you have to be up to date with all of your filings. If you are not in compliance the IRS won?t work with you. Collector?s paradise?Don?t get me wrong the IRS will work to get your money, but they?ll do so through bank levies, wage garnishment, and asset seizures. Not all bad?Of course the IRS is perfectly willing to get you in compliance. In fact they?ll even do it for you. This is called a Substitute Filing Return, and if the IRS does this your existing debt will multiply before your eyes. Here?s the secret?So you want to settle your debt without the IRS taking your stuff. You don?t want the IRS to file your returns for you and cause you to owe even more money. The question is: what can you do?

You can file those returns is what you can do! Depending on how far back those returns go you may not have all of the financial records from the time. You can get your basic information from the IRS in the form of a wage and income transcript. If you have any information for deductions or credits available great! If you don?t you?ll just have to settle for what is available.

If the IRS has Substitute Filed your returns you have to provide complete proof that their return was wrong. If you don?t have the proof, you?ll have to accept their return for you.

Once you?re in compliance however you can begin working on your tax debt. You can put yourself into a position to at least discuss payment options with the IRS, or even settle your debt. Now you have the Smoking gun?Use it!

Richard Close was an IRS-Hitman. He was a revenue officer who took out anyone that owed the IRS money. He left that behind and now helps thousands of Americans beat Uncle Sam and save thousands of dollars. The IRS-Hitman can help you with your tax debt problems. He offers free advice and tips on removing wage garnishments and bank levies; and arms you with the skills to slash your tax debt: Visit at: http://irs-hitman.blogspot.com or www.taxdefensenetwork.com, or contact: email irs-hitman@taxdefensenetwork.com or 1-888-248-9058.