Tax Debt Solutions Blog

IRS Help: You vs IRS

Can Your Tax Story Win Against the IRS’? 

  

Many taxpayers have experienced their innocent spouse claims, collection appeals and tax returns disappearing.  They find out, when they are informed, they were never processed.  The only explanation is they were lost.  When this happens it is very hard to convince the IRS you really did send it and they have misplaced it.  The IRS expects you to show them proof of that filing.

In order to protect yourself against this kind of situation you must know the safest way to file.

Do not mail your tax appeal, return or request.  Take it personally to your IRS walk-in meeting point.  Make sure you also have a copy in your possession.  Request the IRS official to date stamp the copy as proof of receipt when you file the original.

If you have multiple unfiled returns, do not place all in a single envelope.  Place each one in its own envelope. By doing this you are raising the chances of each return being processed through the system—4 out of 5 returns being processed is better than none.

It is common for a taxpayer’s filing dates to be disputed by an IRS Appeals or Revenue Officer.  When this happens those officers only want to see a copy containing an IRS date stamp as proof.  For this reason it is highly advisable for you to hand deliver Collection Due Process applications.

If you must use the post office to mail then request a mailing certificate.  Even with a legitimate mailing certificate the IRS is known to query the contents of the envelope in question.  The stance of the IRS is a mailing certificate shows you mailed an envelope but does not prove what was in the envelope.

It is sensible to ensure you always have the necessary proof of filing.  It takes a little extra time but when it comes down to your story versus the IRS you have no chance of winning.

Tax Relief: Forgetting To File Is NOT Good Enough For The IRS

It’s not unheard of for taxpayers to fail to remember to file for their taxes.  There are individuals who genuinely find the filing of their taxes slips their mind.  If this does happen it is advisable to take action as soon as you can.  The sooner you make it right with the Internal Revenue Service, the sooner your outstanding tax bill will stop increasing in both interest and penalties.

A common situation for certain individuals is they discover they are without a W-2s or 1099s relating to the years that are unrecorded.  This is a situation that is the start of a number of problems if not sorted out in the correct manner.  The reason it will be picked up by the Internal Revenue Service is because there is a procedure for corresponding the earnings in the IRS account with the earnings on the tax return.  One effective method of making sure your return is correct is to take the data straight from the Internal Revenue Service.  Use the IRS data to put together your tax return.      

If you want to achieve an amicable relationship with the Internal Revenue Service in order to bring about a favorable outcome regarding an unresolved tax problem, you may want to consider the services of a tax professional.  This is most important because if you don’t go about correcting your tax problem in an appropriate manner you could be faced with prison.

If you are one of the taxpayers who forgot to file the only way to get out of this serious situation is to make contact with the Internal Revenue Service and convince them you are doing everything that is expected of you.  Make sure they understand you take your oversight very seriously.  The Internal Revenue Service would prefer to work with you to get the money owed as soon as possible.                

Tax Relief: Hire A Tax Professional

Tax Professionals

Many ads claim they can assist you to pay an IRS debt for less.  They profess knowledge to reduce your awful tax bill.  Many call this ‘pennies on the dollar’.

They may have helped a few taxpayers pay less, but it’s not easy.  It is probable that even more taxpayers cannot reduce tax bills even with their assistance.

Such companies hand in an OIC (Offer in Compromise) for the client.  In certain situations it’s an alternative where the IRS accedes to an amount lower than the taxpayer’s complete bill.  The IRS only does this when it’s more gainful to obtain money fast instead of spending years and money getting the taxpayer to settle in full.

The ads promise it’s an easy route.  However, realistically they can’t decide on an amount and the IRS approves it.  You must complete an OIC (form 656-A).  In addition, you must attach a completed CI (Collect Information).  CI (form 433-A) gives your financial data.  The CI data must verify inability to make full payment and your proposal must be reasonable.  A $150 fee must go with form 656-A (OIC).  Only proof of little or no finances will allow a reduced fee.  An additional 20 percent is required if you make a complete OIC amount.  For an installment OIC arrangement a first payment is required.

So, the reality is the IRS doesn’t make it easy to reduce your tax bill.  ‘Offer in Compromise mills’ or ‘pennies on the dollar companies’ aren’t your best solution.  Tax experts and the IRS share this view.  You must pay such companies whether they fulfill their promise or not.  There is a belief the IRS is going to penalize such companies for misleading taxpayers.

A qualified tax professional has the expertise to follow IRS regulations and processes on your behalf.  He or she will give you an honest estimation of your tax situation.  This is preferable to wasting time and cash on a company that doesn’t fulfill its promise to reduce your tax bill.                

Tax Relief: Say No More - Uncle Sam Is Perfect

It’s not unheard of for the IRS to let a taxpayer know a tax return was not received.  This includes innocent spouse claims, tax returns and collection appeals.  It happens because there are times when the IRS misplaces mail.  To be fair, it does not happen on a large scale but it does happen.  However, according to the IRS if they didn’t receive a tax return then it’s your fault.  Their stance is: you did not file.  If you believe the IRS is in the wrong then you will have to prove it.  Your word is not enough.

 

When it comes to the IRS prevention is far better than cure.  It is very difficult to convince them of any error on their part.  One way of making certain your tax return reaches them is to hand-file.  This means you must take your tax return, request or appeal to the IRS walk-in center.  Make sure you also have a copy of all documentation.  Insist the IRS date stamps the copy when the original is filed.  Do not mail all returns in one envelope.  Place each return it its own envelope.  This is to stop all going missing at one time.

 

Another area where Uncle Sam is infallible is time periods.  If the IRS disputes the delivery date of an appeal they expect undeniable evidence to prove you are in the right.  The dispute will come from an Appeals Officer or other Revenue Officer.  Only an IRS date stamp on a copy will convince them you made the appeal in time.  To safeguard yourself you must only hand-file collection due process appeals.

 

If you must use a post office, request a receipt as proof of mailing.  However, this is not the end of IRS disputes.  They have been known to dispute the contents of an envelope.  According to them a receipt only shows an envelope was mailed but not what the envelope contained.  This is not a reasonable approach but if you can’t prove you are in the right then the IRS will not accept your word without obvious proof.

Tax Relief: SOS to Ease Tax Burden

It has been established that many tax payers are behind with tax returns.  In fact, many are from four to eleven years behind.  This means there are many Americans under a great deal of stress to get on top of their tax deposits.  This is a situation that has been around for many years.  Now, there is also a weak economy causing unemployment and all the added financial burdens that go with it.  This means there are growing numbers of tax payers who can’t pay their taxes by 15 April.

 

Regardless of how burdened you may feel it is advisable to remain in contact with the IRS rather than avoid them.  Your situation may be bleak right now but you are entitled to specific rights and with a little tax knowledge you can improve your position with the IRS.

 

The starting point is to know you have the right legal help if necessary.  If you don’t file a tax return then the IRS will resort to filing a proxy for return.  If they do then it is highly likely they will overstate the amount you owe in taxes.  An overstatement will result in interest and also penalties.  The best way to avoid this situation is to file your own returns and give them the correct amount you owe.

 

Another consequence of not filing is the 143 penalties used by the IRS.  If for any reason you have experienced events that are life changing.  Events that may be accepted by the IRS as valid are loss of employment, divorce, chronic illness and closure of a business.  If such situations are the cause of you not filing a tax return the IRS will assist you and also overlook appropriate penalties.

 

Should you receive an IRS letter of notification don’t turn a blind eye because they will not forget.  It is possible to strike a deal with them so that you are able to catch up and pay your legal taxes, and achieve tax relief.

Tax Relief: Oh No! I Have Unfiled Tax Returns

A lot of people, especially those who are self employed, put off filing their tax returns until the very last minute and it can be very easy to overlook them entirely.  People put off filing them for all kinds of reasons such as procrastination, not enough money at that time, or simply because they just don't feel like it. No matter what your reason, it's not a good idea to let unfiled tax returns pass the one year mark. After one year, the IRS gets upset and you will be put into a category called “Non-Filer”.  This is not a good place to be.

 

How the IRS finds out

The IRS has a top notch computerized system called the IRP or Information Returns Program.  This compares your W-2's, 1099s, and other forms to what employers have filed and if they don't match, you will get a letter.  If you ignore the letter, a call will come, followed by an agent.

 

Penalties

The IRS doesn't take Non-Filers lightly.  You can get up to one year in prison and/or a fine of up to $25,000.  That's for each year you haven't filed.  If you have any unfiled tax returns from previous years, get them taken care of immediately to show you are cooperating and you should be ok.

 

IRS procedure

If you have unfiled tax returns from six or more years ago, odds are the IRS won't come after you. Especially if six years ago you worked in a retail store or some other lower paying job.  Just because the IRS isn't calling and sending agents doesn't mean you don't have to pay.  Any taxes owed have been gaining penalty fees and interest that entire time.

 

What you should do

Take care of any unfiled tax returns immediately even if you can't afford them right now.  This will stop all the penalty fees but not the interest.  If you have many years worth, send them individually on different days.  This can help keep you under the IRS radar.

Tax Relief: Getting Help with Unfiled Tax Return Preparation

To get help with the preparation of your unfiled tax returns, you have a few options depending on your income. If you earn a low to middle income, you may qualify for free help with tax return preparation. Otherwise, going to a qualified professional will be of great help for preparing your unfiled tax returns.

 

The Volunteer Income Tax Assistance (VITA) program was previously an independent organization that helped those with a low to middle income in the preparation of their tax returns free of charge. It has since joined forces with the IRS and its e-file system to provide a more efficient service (still free of charge). The IRS e-file system is a means of sending tax returns and other documents to the IRS online. The merger between the e-file system and VITA means that the VITA volunteers can now prepare tax returns and send them to the IRS electronically and directly, making it a quicker process.

 

If you have an income that exceeds the limit for help from the VITA program, you will not be able to use it to get help with your unfiled tax returns. You can, however, use a qualified tax professional to help with your unfiled tax returns (and the same applies for businesses, who also do not qualify for aid from the VITA program). You can even find a nationwide list of tax companies that are approved to use the IRS e-file system if you feel using it would be the most efficient way of getting your tax return prepared. You can search through this list to find local companies by entering all or part of your zip code (depending on how close you want the company to be; entering a partial zip code will cover a wider area).  

http://www.irs.gov/businesses/small/article/0,,id=174271,00.html

Tax Relief: Ways you can get Help with Unfiled Tax Returns

 

If you discover you have unfiled tax returns, you can get help from the IRS with regard to sorting out the issue. Help with unfiled tax returns from IRS offers is free, and you can get it in a multitude of different ways. You can get help with unfiled tax returns via the internet, by calling the help service, via facsimile or from in-person contact.

 

The IRS provides a great deal of information on its website and has a thorough FAQ section for questions you may have. They also allow you to download various forms you may find you need. For help over the phone, you have a few options. You can call the TeleTax service, which gives you a host of pre-recorded messages, providing information on various tax topics. You can use the TaxFax service if you have a fax machine and would like forms faxed to you (although you need to know the order code for the forms). You can also call up the telephone helpline to order forms, and you can call a different, toll free, helpline if you would like to speak to someone about specific questions you have.

 

If you want a more direct and personalized method of getting help with your tax returns, you can go for getting direct, in-person, help. This can either be through a walk-in service or at a Taxpayer assistance centre. Walk-in services are available at public libraries, post offices and IRS offices. From these you can get access to various tax information as well as forms you may need. Taxpayer assistance centres offer individuals personalised help on business days. You should call the centre before you go to ensure you can be seen. The opening hours for taxpayer assistance centres is increased from January until April 15^th, and they even have mobile units to visit remote communities as well as setting up Saturday centres in shopping malls during this time.

Tax Relief: What Do You Do If You Discover You Have Unfiled Returns?

 

It is important that you make sure you file all tax returns as soon as you realize you have unfiled returns, whether you are able to full pay them or not. Upon discovering the problem, the first thing you should do is ask for help. The next thing you should do is think about paying the tax debt.

 

You can contact the IRS in a number of different ways to ask for help. The service is free and it can assist you with all the questions you may have pertaining to your unfiled returns. You can contact the IRS via telephone, the internet or direct (in person) contact. You will be able to receive help with getting the required paperwork together via this service. Additionally, you can even receive help with getting your unfiled returns sorted out and prepared for free if you have a low to mid-income. This tax preparation service is collaboration between a voluntary organization (The Volunteer Income Tax Assistance program (VITA)) and IRS e-file. The significance of this is that this return preparation can be done electronically, which further eases the situation. Those with a high income do not qualify for help from this collaboration, but can still use paid-for tax preparation services that are approved to use the IRS e-file system if they so desire.

 

Once you've managed to file your unfiled returns, the next thing to think about is how you are going to pay. You can go for a variety of different payment methods, such as check, credit card, money order and electronic funds transfer. Some individuals who file their returns late are able to qualify for a payment plan, although it is cheaper in the long run to pay in full.

Tax Relief: Unfiled Return? The IRS Can Make You Cough Up the Cash

 

Once the IRS discovers that you have unfiled returns, various forms of action can be taken. "Enforcement action" is the most serious consequence. What this means is that they enforce the filing of the return, making you pay your tax debt. First of all you may be issued what is known as a Summons. A Summons is used to gain the information and records required to file the tax return, or to find out if the individual is able to pay the tax. A summons can involve requesting information from not just you, but from employers or anyone who may be in possession of the relevant records.

 

If you do not pay your tax, and when eventually you file your return, the IRS will issue you with a bill called a Notice of Tax Due. This bill will tell you how much you owe. Any interest gathered on the owed tax or penalties for late payment will be addressed in this bill. You can pay through a variety of different methods (credit card, cash, check, money order, whatever you like).

 

If you are unable to pay, or you make no effort to pay, the IRS may take a few steps to ensure you are able to pay off your debt. These steps can involve forcing you to re-mortgage your house or forcing you to take out a loan (meaning they are getting money from you via your assets). If, after these measures, you still do not pay, you could be issued what is known as a Notice of Levy, meaning your property, bank account and any other assets of value could be seized in order to satisfy the tax debt.