When Are Tax Resolution Services Important?
Dealing with the IRS can be complicated and challenging. Maybe you owe money to the IRS from your last tax return; or it might be a more complicated situation where you have years of unfiled tax returns. Tax laws change each year and understanding them is critical for compliance. You may or may not understand your tax situation and how to resolve it. Often, the best way is to find a professional with significant experience in solving tax issues. Below are 7 situations when tax resolution services are important:
1. Dealing with IRS Tax Penalties
Our tax resolution services include reduction of penalty, interest or abatement. However, the IRS will agree to forgive penalties where there is reasonable cause. We will listen to your reason for failing to file or pay taxes and find details that the IRS would consider the reasonable cause.
In addition, the IRS can forgive first-time penalty abatement. It’s granted if you’ve had a good history of tax compliance and you’ve incurred a penalty for the first time in three years.
2. Resolving Tax Lien Issues
The Internal Revenue Service issue a tax lien to obtain security in the tax debt owed. It can significantly affect your credit, and your ability to obtain a loan or purchasing a property.
As tax professionals, we understand all the options of resolving tax liens (lien withdrawals, releasing a lien, or discharging the lien) and we bring insight into the process of resolving liens. An IRS lien does not have to freeze your finances indefinitely.
3. Removing IRS Levies and Wage Garnishment
A tax levy is different from a lien. It can be extremely detrimental to you or your business. A tax levy is a procedure the IRS uses to collect the tax debt. These give the IRS multiple ways to collect the money you owe including freezing assets (funds in your bank, social security income and accounts receivable income) and garnishing wages. Regardless of your expenses, the levy can take money out of your paycheck or other sources of income.
There are procedures which enable you to prevent a levy from happening, or request the creditors to return levied assets to you. We understand Publication 1660 and we offer guidance on how you should proceed.
4. Filing Missing Returns
It is easy to do nothing about your back taxes, but failing to file could have serious consequences. It’s considered a federal misdemeanor punishable by a fine of up to $10,000 and potential jail time.
To deal with back taxes, you’ll need tax documents (for the years you didn’t file), W-2s, and 1099 forms. You can request copies of your wage and income transcripts from the IRS. With our experience in preparing back tax returns, we make sure you have all the necessary documents. We help business and individual clients to follow all the instructions and develop an approach to tax compliance.
Remember, you cannot file late returns electronically. We will help you to prepare your back taxes, print them, and deliver them to the IRS.
5. Reviewing Payment Options
The IRS offers different payment plans to both business and individuals, including:
- Requesting an installment agreement – A payment plan is an agreement only available if you owe the IRS $50,000 or less, including penalties and interests. It helps you to pay back your taxes in installments and over an extended period of time.
- Asking for an Offer in Compromise – An Offer in Compromise (OIC) is a great tax debt strategy when you can’t afford to pay your debt in full. OIC allows you to settle your tax debt for less than you owe. We offer expert, step-by-step guidance on how you can qualify by proving that paying the debt in full would cause financial hardship.
- Being declared Currently Not Collectible – You can ask the IRS for deferment (temporary delay of paying a tax debt) until your financial situation improves. The debt you owe will still accrue interest and penalties. The IRS uses the information on Form 433A, 443B or 433F to determine whether you’re eligible for tax hardship deferment.
There are certain requirements you have to meet to qualify for certain types of agreements, and you may not fully understand each of these tax relief options. Negotiating with the IRS can also be difficult. We can advise you on how to qualify for the most suitable payment plan and improve your chances of approval. We make sure all the paperwork is in order and guide you to arrive at a favorable amount so you may not end up paying more than you would have.
6. Representation in IRS Appeals
Generally, the IRS sends a letter explaining their findings and the taxes owed (with interest and penalties) to bring you back into compliance. You may find yourself unsatisfied with the results of interest, penalties on taxes, an audit or any other IRS actions. If you’re unhappy with their decision, you have a right to appeal.
Unfortunately, the appeal process can be complex. A tax expert will help you to request an appeal through a formal written protest. The protest should be filed within 30 days from the date of the letter. We analyze your case, come up with the strongest defense and negotiate a favorable compromise on your behalf. With our knowledge of tax law, we can maximize your chances of a successful outcome on the appeal.
7. Protecting Your Tax Refunds
Even late filers are entitled to tax refunds, but there is a strict time limit. In most cases, you have three years from the date your tax return was due before your refund expires. Tax refunds may be applied to other tax debts.
Time is of the essence when it comes to tax refunds and timely assistance would make a difference. We are familiar with the IRS rules on tax refunds, and can help you maximize your refund when filing late.
Our Tax Resolution Services are the Way to Go
Regardless of your tax issues, at True Resolve Tax we are competent to handle all the complexities of taxation. We offer tax resolution services to assist you with compliance and dealing with the IRS down the road. We’ll give you advice on tax documentation and we will fully represent you (or your business) interests before the IRS.
As Enrolled Agents, we’ve gained first-hand information working for the IRS. Our knowledge gives us the advantage of understanding both sides (both the IRS’s perspective and your perspective). We’re well-positioned to represent you to the IRS. We will negotiate the best terms and conditions for your unique tax problems. Worry not; your tax information is completely confidential. We’re ethically and legally obligated not to share it. We also have a proven track record of success for our clients. For a free consultation, please call us at 720-262-2591.