TAX REPRESENTATION

Have you been notified by the IRS that you owe money for unpaid taxes?  Are you being auditing by the IRS?  Is the IRS attempting to collect unpaid taxes through wage garnishment, bank account levy and/or placing a lien on your home?

If so, you must act quickly to resolve these issues.  The IRS has broad powers to collect unpaid taxes through various methods.  Additionally, the IRS assesses penalties and interest on unpaid tax amounts.  Frequently, these penalty and interest amounts can exceed the total amount of the original underlying debt.  Any delay could end up costing you a significant amount in penalties and interest.

While the thought of outstanding tax amounts can seem overwhelming, there are avenues available to you that can provide alternatives to paying the outstanding tax liability plus penalties and interest in one lump-sum on demand from the IRS.

Some of the methods of relief available to taxpayers include:

Innocent Spouse

Frequently, the IRS attempts to collect a tax liability from a former or current spouse of a taxpayer.  In order to address situations where the former or current spouse did not incur the tax liability or was unaware of the tax liability, the IRS offers the Innocent Spouse program.  If the former or current spouse qualifies under the program, then he or she will not be held liable for the tax due.

Non Collectible Status/Currently Not Collectible

If a taxpayer does not have the ability to pay the outstanding tax liability and meets the IRS-mandated criteria, the IRS can defer collection of the liability for a specified amount of time.

Offers in Compromise (OIC)

An OIC is an agreement between the IRS and the taxpayer that reduces the amount of the tax liability to an agreed upon amount.  An OIC is not a payment plan, but a permanent reduction in the total amount due to fully satisfy the tax liability.  There are generally 2 reasons why an OIC would be granted:

(1)   The IRS does not believe that the full amount owed will be collectible; or

(2)   There is a legitimate dispute by the taxpayer that the tax liability is owed to the IRS.

Payment Arrangements

If a taxpayer is unable to currently pay the liability due, the IRS does have several payment installment plans, depending on the taxpayer’s total liability and ability to pay.

Penalty and Interest Abatement

As mentioned above, the penalties and interest that accrue based on the underlying tax liability can significantly increase the amount you owe the IRS.  However, in certain circumstances, the IRS will allow for the removal of penalties (called penalty abatement), which can greatly reduce the amount that must be paid to the IRS.

Release of Levy

The IRS has the power to seize the assets of a taxpayer as payment of outstanding tax liabilities.  This seizure is also known as a levy against a certain asset.  Generally, the IRS levies a taxpayer’s home, wages and/or bank accounts.  If a levy is placed against one or more of a taxpayer’s assets, it can be removed, if the levy creates an undue hardship for the taxpayer.  The tax liability does not go away with the release of levy but the taxpayer would then be able to access one of the other forms of relief available through the IRS to ensure that another levy is not issued.

The worst thing that can be done is to ignore the IRS.  Options are available if you do not have the resources to pay the required amount in full.  However, the best outcomes happen when alternative remedies are pursued in a timely manner.

We provide tax problem resolution and representation to individuals and businesses that are experiencing tax issues with the IRS.  We understand tax law and can negotiate with the IRS on your behalf to provide you with the most advantageous resolution of your tax liability that is available to you.

Please contact our office for additional information on how we can assist you with your tax issues.
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