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Is It Time to Hire a Tax Lawyer?

April 19, 2011 By

If you are in trouble with the IRS, there are several important factors to consider before choosing representation. Consider the level of involvement of the IRS in your issue thus far.

If the IRS is going to audit you because they believe your taxes were fraudulently filed, a tax lawyer will be able to advise you on what to do to avoid severe penalties of up to 75% of taxes you owe. If you owe taxes and paying them will create severe hardship for you, you may be able to enter into an Offer in Compromise agreement with the IRS which will allow you to pay less than your full debt. Although you can get an Offer in Compromise without representation, a tax attorney will be able to increase your offer’s chance for acceptance. In the event that your offer is not accepted, your attorney can advise you on your other options.

You may have a lien placed on your assets or your wages may be garnished because of failure to pay your taxes. With a lien or wage garnishment, the IRS attempts to gain back the value of the taxes you have yet to pay. A tax attorney can help you by getting the lien or wage garnishment removed. If the IRS has already audited your tax returns and determined they were fraudulently filed, a tax attorney can help you get the resulting penalties removed.

To find the best tax lawyer for your needs, do your research. Many attorneys offer free consultations, which is a great opportunity to assess whether you are compatible with that tax lawyer. It may also help to ask others who have had tax problems, and it is essential to make sure they have experience, the proper education, and are a member of the state bar.

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Innocent Spouse | Wage Levy

November 12, 2010 By

Wage Garnishment: What about my spouse?

Frequently when someone is issued an IRS wage levy, they may worry about whether their spouse’s income will also be subject to the levy. The fact is that the IRS is not allowed to take income from your spouse if they are deemed to not be liable for the taxes, whether or not you filed a joint return.

If you filed separate tax returns the situation is very simple; only you can be held liable for the IRS wage levy and only you will have to pay it. You are the person who signed the return, and therefore, under the law, you are the only person who can be held responsible for paying off the debt.

Additionally, if you have been issued an IRS wage levy for debt from a return you filed a few years ago with an ex-spouse, the IRS will not hold your new spouse accountable for any debt – it is either yours or your ex-spouse’s.

If you have filed a joint return with your current spouse, they will still not necessarily be held liable for your tax debt. The IRS has rules and regulations in place to protect ‘innocent’ spouses from being held accountable for debt that is not theirs and having things such as IRS wage levies imposed upon them. ‘Innocence’ here is determined by whether the IRS decides if your spouse knew about the unpaid taxes and whether they received any of the ‘benefits’ of them. If they decide your spouse didn’t know about the unpaid taxes and/or didn’t receive any benefits, they will be granted relief, otherwise they very well could be subject to a wage levy too. In the end, the decision is up to the IRS.

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IRS Bank Levies, IRS Wage Garnishments and IRS Tax Liens Guidelines

October 6, 2010 By

Solution to IRS Bank Levies, IRS Wage Garnishments and IRS Tax Liens

If you have outstanding taxes the IRS will make use of bank levies, tax liens and wage garnishments to get their money. You must respond to the IRS no matter how threatening. If you respond, you can halt IRS action. There are ways to protect your credit record, savings assets and salary.

If you are threatened by the IRS, the assistance of a tax professional will prove invaluable in delaying or stopping a seizure of assets.

A bank levy can involve your bank accounts and even those with your children’s names, car, life insurance loan value, commissions, house, accounts receivables, salary, rental earnings, retirement accounts, bank accounts, dividends and licenses. A notification means time is running out fast and you should request a payment plan. This will delay you having to pay.

IRS wage garnishments are tough because it leaves you with very little to live on. Around thirty to seventy percent of your salary is taken. The IRS makes this arrangement with your employer. Your employer may regard back taxes as negative and if you lose your job you still have to pay the IRS. An Offer in Compromise is an alternative to wage garnishment.

When a tax lien is filed it is made public and reflects on your credit listing. You lose the right to transfer or sell your property. You can’t get a loan by using your property as collateral. A solution may be to assign ‘currently not collectible’.

You do have the right to appeal an IRS decision. You must take action within a certain period of time. If you do you can request a Collection Appeal to counteract an IRS action due to back taxes. When this is done the Appeals Office must come to a conclusion within five days.

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Tax Relief Tip: How to Avoid an IRS Wage Levy

September 16, 2010 By

How to Avoid an IRS Wage Levy Before It’s Too late

If an IRS wage levy is something you have had to deal with in the past or if it is something you feel may happen to you in the future, the most important thing to do is to pay off any tax debt you may have as quickly as possible – if you are able to, of course. Additionally, you need to make sure that you keep up to date on all your taxes; you do not want the IRS to think you are behind in paying them.

You should think about paying your taxes or paying off any tax debt in the same way as you think about any other types of expenses you have. It is something you really need to budget for if you want to avoid action such as an IRS wage levy being taken against you. You should aim to pay the IRS before you pay off other debts (for example, credit card debt).

If you are self-employed, a good idea to budget for your taxes is to set aside a separate bank account for them. This is a good way to avoid an IRS wage levy as not only are you making sure you’re taking your taxes into consideration, but you are also showing the IRS that you are planning to pay them – which is something they cannot fail to be impressed about. You should aim to put between 10 to 20 percent of your earnings into this separate tax account, and more if you have debts or penalties to pay off. This is a very simple and easy way to avoid an IRS wage levy being filed against you.

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Tax Relief: Liens and Levies – The Basics

May 3, 2010 By

A call for tax relief must be founded on one of three points:

  • Tax liability was fulfilled prior to filing of the lien
  • Evaluation of a tax liability didn’t honor the Notice of Deficiency Procedure or Code of Bankruptcy
  • Termination of the time for bringing in the liability before filing of the lien

Prior to a complete payment the IRS is allowed to remove a tax lien due to the following:

  • Either the lien notice was too early or not in accordance with the admin process
  • In order to fulfill the tax liability the taxpayer enters into a contract
  • Collection of taxes is aided by the lien notice being withdrawn
  • It is to the advantage of the government and the taxpayer if the lien notice is withdrawn

If a notice of tax lien is withdrawn it gives up lien priority by the IRS at the time of filing. It does not influence the fundamental tax lien.

A levy must be released by the IRS when:

  • Due to a time lapse primary tax liability is fulfilled and is unenforceable
  • Tax levy release aids the gathering of tax debt as decided by the IRS
  • The carrying out of an acceptable installment payment agreement by the taxpayer
  • Economic hardship is the result of the levy as decided by the IRS
  • The tax liability is more than fair market value of property and limited levy release is not an obstacle in collection of tax

The taxpayer has the right to ask the IRS to sell the property that is levied. Under certain circumstances levied property can be restored by the IRS. This is done as if the property was erroneously levied on but no interest is restored to the taxpayer. In the case of negligence on the part of the IRS in not releasing a lien regarding property after being notified in writing, the taxpayer may be compensated.

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“Innocent” Spouses & Liability For An IRS Wage Levy

March 10, 2010 By

Frequently when someone is issued an IRS wage levy, they may worry about whether their spouse’s income will also be subject to the levy. The fact is that the IRS is not allowed to take income from your spouse if they are deemed to not be liable for the taxes, whether or not you filed a joint return.

If you filed separate tax returns the situation is very simple; only you can be held liable for the IRS wage levy and only you will have to pay it. You are the person who signed the return, and therefore, under the law, you are the only person who can be held responsible for paying off the debt.

Additionally, if you have been issued an IRS wage levy for debt from a return you filed a few years ago with an ex-spouse, the IRS will not hold your new spouse accountable for any debt – it is either yours or your ex-spouse’s.

If you have filed a joint return with your current spouse, they will still not necessarily be held liable for your tax debt. The IRS has rules and regulations in place to protect so-called ‘innocent’ spouses from being held accountable for debt that is not theirs and having things such as IRS wage levies imposed upon them. ‘Innocence’ here is determined by whether the IRS decides if your spouse knew about the unpaid taxes and whether they received any of the ‘benefits’ of them. If they decide your spouse didn’t know about the unpaid taxes and/or didn’t feel any benefits, they will be granted relief, otherwise they very well could be subject to a wage levy too, although what happens is up to the IRS.

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