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How to Get a Tax Levy Release

January 21, 2011 By

A tax levy under United States Federal law is an administrative action by the Internal Revenue Service… where without going to court the IRS has the authority to seize property to satisfy a tax liability. Under Internal Revenue Code Section 6331, the IRS can “levy upon all property and rights to property” of a taxpayer who owes Federal tax.

What are your options for having your tax levy released? Of course there is the option of paying the IRS in full for some folks. However one of the most readily available options to remove a tax levy for most taxpayers is a formal monthly installment agreement with the IRS.

If your case constitutes a financial hardship and payment of your taxes will greatly impair your ability to support yourself and/or family, the IRS may lift the levy. In some cases, you may be able to wait out the 10 year statute of limitations placed on the IRS to collect back taxes. However, be aware that certain actions by you and/or the IRS can extend the statute of limitations.

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Tax Relief: IRS Statute of Limitations

December 6, 2010 By

What can I do to make sure the IRS collections statue of limitations works for me?

The IRS collections Statue of Limitations says that any debt you owe the IRS must be collected within ten years of the tax return(s) in question being filed. However, certain things can cause the Statue of Limitations to become extended, so it is important you know how to avoid this!

If you file for an Offer in Compromise, the IRS collections Statue of Limitations will become extended. How long this is depends on how long it takes for the IRS to review your case – it can be as long as a year.

Likewise, filing for bankruptcy will extend your Statue of Limitations. Here, it will be extended by the amount of time you spend bankrupt plus an extra six months.

Other situations that will extend your IRS collections statue of limitations include applying for Innocent SpouseRelief and filing a Taxpayer Assistance Order. For the former, the statue of limitations will be extended for the 90 day period for petitioning. For the latter, your Statue of Limitations will be suspended until your case is reviewed.

It is essential you consider the pros and cons of applying for anything if your statue of limitations is coming to an end. If it seems likely the IRS will reject your request, you will only be doing yourself harm by making an application, however if you are confident they will accept your request, you need to thoroughly think about how much benefit will come from making this move so soon before the collection timeframe is up.

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Faster Solution: Currently Not Collectible vs Bankruptcy

October 22, 2010 By

Which is a faster solution?

Currently Not Collectible status or Bankruptcy

A lot of people may wonder about whether currently not collectible status or bankruptcy is best for them. Bankruptcy is a great way to get rid of huge tax debt; however the ideal option for you depends on your situation.

Many people who qualify for Currently Not Collectible status may consider bankruptcy if they find they’re worrying excessively about any changes in situation and how it may affect their deemed ability to pay the IRS.

If you want to switch from Currently Not Collectible to bankruptcy, you need to be aware of the rules that apply for bankruptcy. If you are CNC, it is unlikely that you will be able to file for a Chapter 13 bankruptcy, since this implies your finances are in enough order to pay the IRS in monthly instalments for your owed debt. Instead, you will have to file for a Chapter 7 bankruptcy, which has a few criteria you need – the tax returns you owe for must have had a due date at least 3 years before the bankruptcy is filed and they must have actually been filed at least two years before.

In other words, if you filed your overdue returns less than two years ago, you will not be able to quality for Chapter 7 bankruptcy. Instead, your best bet is to wait until two years from the filing date has passed, and then you can apply for the bankruptcy.

No matter how long you have to wait, most of the time you will be able to file for the Chapter 7 bankruptcy in the end, since your current status as not collectible means the IRS will be ‘on hold’ with you until you can declare yourself as bankrupt.

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Tax Relief: What You Should Know About Tax Relief and Bankruptcy

January 7, 2010 By

Many taxpayers consider bankruptcy with the intent of being released from their tax debt. Tax relief may be thought of by some as motivation for bankruptcy, but going through with filing should be avoided if at all possible. When using bankruptcy as a form of tax relief, there are some essential facts that should be understood.

Filing for bankruptcy is one option for alleviating tax debt; however, it is not recommended. Taxpayers who are considering Chapter 7 bankruptcies should be sure they have all of the facts before doing so. Your odds of being released of your tax debt through a Chapter 7 can-in reality-be rather slim, not to mention that this is a rather costly method of eliminating tax liabilities. This route should be your absolute last resort after exhausting any and all other options available to you; in other words, “Plan Z” on your list.

Filing a chapter 13 bankruptcy is also a method that should be used as a last resort. With a Chapter 13 bankruptcy, the IRS can work out a payment plan for taxes owed. With this action, debt owed to the IRS is never forgiven, just delayed through a long series of painstakingly extended payments. Not only is bankruptcy in any form less promising than other more moderate tax relief methods, but it can also ruin your credit. On the other hand, if you have serious credit issues already, you may see no harm in filing bankruptcy.

You must understand that bankruptcy was not designed as a bandage or cure for tax issues. Certain laws allow the IRS to collect on back taxes even if a bankruptcy is in effect. It is all quite complicated, even when broken down into layman’s terms. Tax relief is one of those areas that you do not want to guess on. One wrong move could leave you in a worse situation than the one you were initially trying to get yourself out of.

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Tax Relief: Eliminate the Pain with IRS Wage Garnishment Help

January 7, 2010 By

Some people will do anything for attention, but playing games with the IRS takes attention-seeking to a whole new level. Those who fool around and neglect to promptly pay their portion of that crazy, burdensome ransom otherwise known as taxes, which is so eagerly collected each year by the IRS, will inevitably find themselves in search of IRS wage garnishment help.

Uncle Sam does not care about excuses or your other expenses. Your job or health status is not something the IRS concerns itself with. Regardless of your perception, if the IRS says “pay” and you fail to jump right up and do so, you are asking to become a victim of wage garnishment. Imagine going to work all week and only getting a small fraction of your hard-earned money to survive on while the IRS nabs the rest for your delinquent taxes.

IRS wage garnishment help comes in small packages, so to speak, as there are certain procedures that must be followed before a garnishment can be attached to your earnings. These guidelines can actually save you in the long run. The biggest thing to remember is that before your wages can be garnished, you must be in default.

If you are in default, you have to be warned (“informed” is more like it). You will be given around 30 days notice from your favorite uncle as to the impendence of your financial doom. When you receive your friendly warning letter, you better get on the ball!

The best time to stop wage garnishment is before it starts. Truth be told, the IRS would rather have it that way. There are other arrangements which allow you to work out some form of IRS wage garnishment help.

A few of the options you have are:  to pay what you owe the IRS in full, file for an offer in compromise, set up payment arrangements, be declared uncollectible, change jobs, or even file for bankruptcy. Remember though, you only have 30 days to work something out with the IRS to avoid wage garnishment.

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