Irs Debt Tax Attorney

Irs Debt Tax Attorney

You may think you don’t need an IRS debt tax attorney at first, but it doesn’t take long to find out that expert assistance is imperative. Anything connected with the Internal Revenue Service and past due taxes can become very complicated quickly. In fact, there are a lot of people who have failed to reach a reasonable agreement with the Internal Revenue Service because they didn’t understand the rules, laws, regulations and procedures.

No Amateurs Allowed

Negotiating with the Internal Revenue Service can be a delicate process in many respects. The process of obtaining an “Offer In Compromise” is a perfect example. An Offer in Compromise is a statement that you create, telling the Internal Revenue Service what you think is a reasonable settlement amount in exchange for eliminating the total debt or closing the past due tax account upon payment.

An Offer in Compromise sounds quite simple by definition, but the process is much more complicated than simply telling the Internal Revenue Service what you think is a fair and reasonable agreement. For one thing, you have to prove your offer makes sense in light of your financial condition. You also have to show how everyone benefits by the Internal Revenue Service accepting your offer.

An Offer In Compromise is only accepted approximately 15% to 50% of the time (depending on which statistics you believe). That’s really not very high odds. The best way to improve your chances of successfully coming to agreement with the Internal Revenue Service is by using the services of a lawyer. An attorney with an expertise in taxes is certified to work as a negotiator with the Internal Revenue Service and so begins the process from an advantage point the average taxpayer doesn’t have.

The Offer In Compromise filing can be complex which means you need an attorney that has experience and can prove success in a variety of tax cases. No two debt situations are alike and it takes knowledge of the laws and regulations to negotiate successfully.

Navigating the System

An IRS debt tax attorney knows and understands the current Internal Revenue Service taxation laws. But even beyond that an attorney specializing in tax negotiations stays current on taxation law changes. This is important when trying to deal with the Internal Revenue Service.

There’s another reason why you need an IRS debt tax attorney when filing an Offer in Compromise. The compromise process is very time consuming and requires frequent communication with the Internal Revenue Service. Most taxpayers are working middle class and can’t take the required amount of time away from their jobs to meet over and over again with the Internal Revenue Service. In addition, staying current on laws for taxation is a job in and of itself.

The Offer In Compromise is just one debt solution that’s available to taxpayers. An attorney can review all of the possible solutions which can solve your Internal Revenue Service problems.

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Don’t Delay In Managing IRS Tax Debt

Don’t Delay In Managing IRS Tax Debt

Debt Resolution, IRS Settlements Offer Help for Serious Tax Problems

San Mateo, Calif., - With tax day behind us, consumers and business owners who owe the IRS are not out of the woods. But while death and taxes are the big two inevitabilities, those with serious tax problems should know that it is possible to negotiate with the IRS to reduce past-due tax penalties and payments, according to Bradford G. Stroh, co-founder and CEO of Freedom Financial Network, LLC.

Americans, carrying more debt than ever, are also more likely to have tax problems than in the past. In 2004, the total of uncollected IRS taxes reached upwards of 0 billion. The number of levies (a key enforcement tool in which the IRS takes possession of assets to collect on unpaid taxes) topped 2 million during fiscal year 2004 - a 21 percent increase from 2003 and triple the 2001 number.

According to Stroh, taxpayers with tax debts under ,000 usually can manage the payment on their own or via an installment plan arranged with the IRS. “Tax problems merit professional help when individuals cannot pay tax liabilities of ,000 or more,” Stroh says. “At that point, specialists can negotiate directly with the IRS on behalf of these consumers, helping them obtain settlements.”

Tax relief specialists usually are attorneys or certified public accountants with special training and experience. Stroh explains that these experts can navigate the intricacies of IRS forms and calculations, help consumers understand the criteria the IRS imposes, and then help them get back into good standing with the IRS.

Depending on the severity of an individual’s situation, two types of IRS settlement are available:

An offer in compromise reduces the principal amount owed to the IRS.

An installment agreement is a payment plan for the amount due and often includes reduced penalties.

“Remember that you cannot let overdue taxes languish,” Stroh warns. “The IRS is serious — and increasingly aggressive — about tax collection and evasion. Tax debt can result in a lien on a house or garnished wages.”

Advisors can help consumers with the following steps:

Evaluate the situation and determine the amount of taxes owed to the IRS.

Ascertain whether the situation meets IRS standards for “doubt as to collectability” (i.e., unable to pay the full tax burden), “doubt as to liability” (i.e., consumer might not owe the tax), or “economic hardship.”

Establish the full amount owed, including taxes, penalties and accumulated interest, and understand whether collection limitations or penalty cancellations are possible.

Determine the best method for managing and eliminating the tax debt.

Negotiate with the IRS to settle on an agreed course of action and resolve the debt.

While facing and handling tax debt can be painful, last year’s bankruptcy reform legislation made it even more crucial for consumers to act. Historically, consumers in severe IRS debt might file for Chapter 7 bankruptcy protection or wait for the 10-year statute of limitations on tax liability to expire. Now, people are much more limited in the ability to obtain Chapter 7 filings. The bill’s new “means test” leads many consumers instead to file Chapter 13 bankruptcy, which establishes a repayment plan, rather than wiping out all debt. Consumers with tax debt may find it much less costly and simpler to work with a debt resolution firm’s tax relief service, which allows individuals to set up tax payment plans while avoiding court fees, attorney fees and bankruptcy judgments on their records.

“Whatever means you choose, tax season means it’s time to face the inevitable and manage your tax burdens,” Stroh says. “Fortunately, experts are available to help you along the way.”

Freedom Tax Relief, LLC (http://www.freedomtaxrelief.com) provides consumer debt resolution services through its Freedom Debt Relief and Freedom Tax Relief divisions. The company works for the consumer, negotiating with creditors to lower principal balances due that can often result in savings of up to half the amount owed. Based in San Mateo, Calif., Freedom Financial Network serves more than 5,000 clients nationwide and manages more than 0 million in consumer debt, offering an alternative to bankruptcy, credit counseling, and debt consolidation.

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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

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

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 ,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 ,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 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 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.

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