When I obtain transcripts from the IRS for my clients I always look for the day the tax was assessed because the IRS only has 10 years to collect the debt. However, there are some events that can occur over that period of time that stops the Statute of Limitations temporarily. They include offers in compromise, collection due process hearings, requests for installment agreements, and bankruptcies.
Teaching Boot Camps and Having a Blast
Earlier this year I was asked by the American Society of Tax Problem Solvers to teach two day IRS Tax Resolution Boot Camps around the country. The attendees are attorneys, CPAs and enrolled agents. Some of them have experience in this field, but the majority have never handled an IRS Collections case.
Why Taxpayers Should Never Talk to the IRS!!
“Before I get help for my IRS problem, I’m going to go speak personally to the IRS officer or agent. Once they hear what I have to say, I am sure they will understand.” Some people who receive a notice from the IRS think that this is a great strategy because after all, what could go wrong? The answer is EVERYTHING.
Should You File Your Tax Return If You Can’t Pay Your Bill?
It is April and your tax return is done. On the bottom of the second page it says that you owe money. The amount is more than you can pay so you decide not to file it. Bad move.
Installment Agreements Can Be The Best Solution
When you owe the IRS money, the first letter you get requests full payment. Every additional letter, telephone call, and personal meeting begins with the same demand. Sometimes taxpayers can write the check, but more times than not, there is no ability to pay the debt immediately.
IRS To Use Private Debt Collection Agencies
It did not work the first time in 1996. It did not work the second time in 2006. Both times the IRS lost money. Three times a charm?
Should You File Your Tax Return If You Can’t Pay Your Bill?
It is April and your tax return is done. On the bottom of the second page it says that you owe money. The amount is more than you can pay so you decide not to file it. Bad move.
What Do Those IRS Certified Letters Mean?
The IRS will not make first contact with you by telephone. Only scammers call.
The IRS does not use email. Only scammers use email.
The IRS generally does not knock on the door. They do not have the manpower.
Owe the IRS Money and Can’t Make Payments?
One of my favorite tax problem solutions is to have the IRS declare my client Currently Not Collectible (CNC). This is for citizens who cannot make even the smallest payments on their outstanding debts. Maybe they are out of work, short or long term, or maybe they just do not make enough income to pay all of their expenses. If this is the case, CNC status is often the answer.
The IRS Returns to Florida
They’re baaaack. After 4 1/2 months of no activity, the IRS will be back in Florida on February 1. None of the Revenue Officers (who are the collectors) or the Revenue Agents (who are the auditors) physically left the state, but they have been quiet.
IRS Private Debt Collectors Fail
You may remember my article last year, “IRS Tries Private Debt Collectors … Again“, where I predicted three times would not be a charm. Yes, the idea has failed not once, not twice, but thrice.
12 Myths About the IRS That Taxpayers Need To Know
I was recently contacted by an organization that offers Continuing Legal Education credits to attorney. They want me to teach a two hour course to attorneys on IRS Problem Resolution. Now I often do this for attorneys, CPAs, and enrolled agents in Florida and around the country but those classes always consist of individuals with at least some tax knowledge or background. They have an interest in this area of the law.
IRS Myth: The IRS Is Impossible To Deal With
The IRS has rules that they must follow. There is the Internal Revenue Code. That is the law and whether they like it or not, they must follow it. They also have the Internal Revenue Manual which they follow 100% of the time as long as they like what it says. When they do not like what it says, they follow it 0% of the time. The Manual contains their rules and guidelines, but it is this not the law, meaning taxpayers are not bound by it. It is my job as a Tax Attorney to hold their feet to the fire and make sure that they comply with the law and follow their own procedures.
Eight Mistakes Tax Practitioners Make When Negotiating With the IRS
Important Tips to Keep From Getting Your Client in MORE Hot Water
Representing citizens with IRS problems is a challenge. The IRS has little sympathy for delinquent individuals and businesses. Fortunately, citizens have rights and, through their legal representative, they can successfully negotiate a resolution that allows them to move on with their lives. To effectively represent their clients, tax practitioners must know the law, the rules and IRS policy.
IRS Myth 1: People Who Do Not Pay Their Taxes Are Bad People
I talk to taxpayers, clients, and prospective clients either on the telephone or in person every day. People who do not have tax problems do not realize that just because you owe the IRS money, are getting audited, or have not filed tax returns does not mean that you are a bad or evil person. Most taxpayers cannot identify with these problems, but I can tell you that usually a situation beyond the person’s control is what gets them into trouble.
IRS Myth 3: The IRS Is Impossible To Deal With
The IRS has rules that they must follow. There is the Internal Revenue Code. That is the law and whether they like it or not, they must follow it. They also have the Internal Revenue Manual which they follow 100% of the time as long as they like what it says. When they do not like what it says, they follow it 0% of the time. The Manual contains their rules and guidelines, but it is this not the law, meaning taxpayers are not bound by it. It is my job as a Tax Attorney to hold their feet to the fire and make sure that they comply with the law and follow their own procedures.
IRS Myth 4: This Is America. You Are Innocent Until Proven Guilty.
With the IRS, it is the other way around. The burden of proof is usually on the taxpayer. If a Revenue Agent auditing your tax return thinks you under reported your income or over reported your expenses, it is up to you to prove you did not. It can be difficult to prove a negative, such as trying to prove you did not have as much income as they say you did.
IRS Myth 5: The IRS Never Forgives Penalties
Failing to file a personal tax return on time carries with it a 5% penalty per month, maxing out at 25%. Filing to pay personal taxes on time initially brings with it a .5% penalty per month, also stopping when it hits 25%. If both penalties apply, the maximum monthly liability of a taxpayer is 5%.
IRS Myth 6: The IRS Never Makes Deals To Pay Less Taxes.
If someone wants to file an Offer in Compromise to settle their tax debt, the IRS will not make a business decision. In the real world, if you owe someone $100,000 and offer them $80,000, the creditor will probably accept the deal. However, the IRS will never leave money on the table.
