Posted by LWM Team on Thu, Feb 18, 2010
"Tax Relief": two words that goes great together and for good reason.
People pay a lot of money each year in taxes and in today's economy, any savings are good savings. The government at state and local levels offers a lot of help that people simply don't realize is available. This is great news if you owe the IRS some money or are looking to save during the filing of next year’s taxes. Most tax preparers will offer you tax relief help but it's a good idea to ask them if you qualify because they may not know your circumstances. Here are a few common types of tax relief:
Penalty Abatement
A lot of people owe the IRS money and penalties and interest will accumulate as long as you don't comply with them. You can get penalty abatement tax relief which will reduce the penalties or even eliminate them completely for past taxes owed.
Installment Agreements
This is exactly what it sounds like. You can work with the IRS to pay them back slowly over a period of months or years instead of giving them a large lump sum.
Disaster Tax Relief
Were you in a recent disaster like Hurricane Katrina? The government will offer complete tax relief to you.
That means you don't have to pay taxes for that particular year or you have a number of years to take care of it.
Tax relief help of this kind doesn't occur very often and is unfortunate but at least the IRS gives you some leeway.
Compromise
Like many credit card companies, the IRS may offer you a compromise. This could be very cheap if you owe a lot of money.
You could pay well under 40% of what you actually owe because the IRS doesn't like to waste time and resources by taking you to court.
Tax relief help is very important to get. Someone well trained in this can find you more areas you may qualify for than you can on your own. Even if they charge a fee for this tax relief help, odds are you will get back much more than you pay.
Posted by LWM Team on Mon, Feb 08, 2010
Just in recent years there has been an explosion of natural and man-made disasters that have totally wiped out what some Americans call "home". In some cases, not just the building they call home, but the entire CITY! And the most important area of disaster loss for millions has been the loss of SOMEONE THEY LOVED! Millions have suffered and millions have helped, but it just isn't enough in most cases. People we love are irreplaceable and cannot come back to us once dead and gone. There are just no words to describe what disasters ‘leave behind them.' But as humans we must find ways, albeit small ways, to help.
I.R.S. to the Rescue!
The first event in a STRING of catastrophic disasters was September 11, 2001, the downing of the World Trade Center and the thousands of innocent lives that were lost. This sent the I.R.S and other federal agencies into fast-forward trying to come up with workable disaster relief in an organized and fair manner...and it needed to be done yesterday! Thus was the beginning of ‘Disaster Relief Tax Credits.' But it was a rocky and mostly uncharted road. And we all know how "efficient" the government is in handling a national crisis! It took WAY too long and caused undue stress for victims, but finally, the federal government has ways to significantly face natural disaster relief and provide help in a good way...well maybe not good, but more efficient, way!
Now all that is required is that your place of residence (state, county or whatever) be declared a "natural disaster area" and you will likely qualify for help if the disaster helped cause you home or property damage. The I.R.S. provides detailed information on the many avenues of help...which in some cases can also mean help for the mending mind also!
Posted by LWM Team on Thu, Jan 07, 2010
If you reside in an area where a natural disaster has occurred, you may be wondering what type of tax relief for disasters is available to you-or at least something to that effect. There are a number of disasters the IRS will not help you with; for instance: your teenager (or your husband) gets the great idea to use regular dish soap in the dishwasher, rainy days when the kids and dog (or your husband) track mud all over your freshly mopped floors and light colored carpet, and of course, occasions when your mother-in-law comes over unannounced and everything is out of order. You notice there was no mention of your husband in the last disaster, so it had to be the mother-in-law! But all jokes aside, there are times where tax relief is granted due to the occurrence of disasters.
In order to be eligible for tax relief due to a natural disaster, a taxpayer must lose something of value due to the fury of nature. If you have lost a business, a house, or even a job as the result of something like a hurricane, tornado or flood, you may be eligible for tax relief. In order to qualify for any type of tax relief offered by the government for victims of natural disasters, the entire area must first be declared by the president of the United States to be a national disaster.
Of course, if you do not know exactly what tax relief is, knowing you may be eligible for it is not a whole lot of help. In the case of natural disasters, tax relief may include, but is not limited to: the postponing of deadlines, waiving of penalties, and so on and so forth.
While the IRS computer systems routinely recognize taxpayers with addresses in a known disaster area and typically make the extensions of tax relief without your request, there are instances where this will not be the case. If you reside outside the specified area but own an affected business within the disaster area, you may still qualify, but would need to exercise due diligence to find out and make sure you receive your fair share of assistance; if you do not, you may be asking, "What is tax relief good for anyway?"