How To Get Help With Back Taxes?
This is a question that millions of American taxpayers ask themselves every day.
Tax problems don't resolve themselves. It's like a chronic financial illness that only gets worse, and more aggressive with time. Some taxpayers believe that the IRS problem will resolve itself, that its a mistake, or that the IRS will never catch up. Others, just don't understand what is happening and why. The longer the back taxes remain unresolved, or ignored, the harsher the intrusion once the government catches up.
IRS notices or other contacts just can't be ignored. With one key stroke, the IRS can unleash the hellish arsenal of:
A tax lien is a public record that tells the world you owe back taxes. Liens are generally recorded in the county where you live or have other contacts.
Liens show up on your credit record, and make it more difficult to get loans or even employment in certain industries. You will also not be able to sell property without clearing up the lien. There are very specific rules and procedures for lifting or shifting priority of tax liens.
Unlike a tax lien that only serves as notice and security interest, a levy actually confiscates your property to pay back taxes.
The IRS can serve a levy to take a bank account, investment account, or other property belonging to the taxpayer. Levies, are extremely intrusive. The majority of levies are a result of the taxpayer's failure to promptly address the tax problem.
In order to avoid or release a tax levy, the taxpayer or their representative must maintain an open dialogue with the tax agencies.
A wage garnishment is a very painful and intrusive method of collecting taxes through the employer. Wage garnishments are harsh, embarrassing, and often prevent taxpayers from being able to pay their living expenses. The employer is
required to collect a portion each paycheck until the debt is paid, or the garnishment is released or otherwise modified. A garnishment can be released if the taxpayer can show that the tax debt has been satisfied or causes an undue financial hardship.
IRS levies billions in penalties every year. Penalties and interest can quickly turn a manageable tax delinquency into a tsunami of debt. The most common penalties aimed at individuals and small businesses are failure to file and failure to pay. Failure to file is levied for late tax returns and caps at 25%, while failure to pay penalizes the taxpayer for not paying the full amount of tax by the due date and also caps at 25%.
It is important to understand that each penalty is intended to punish specific non-compliance. It is crucial to determine what penalties are being applied to your tax bill, in order to determine what relief (if any) is available. Interest is not a purely punitive measure, but rather reflects the cost of money. Interest rate fluctuates based on the prevailing interest rate.
Penalties can be removed if the taxpayer can show that they had a reasonable excuse or were unable to comply.
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Even with all the harsh actions the IRS can take to collect back taxes, there are ways to avoid enforced collections. The key is to be proactive, and not ignore the tax notices. The IRS code provides various methods of addressing the tax bill. Tax programs range from temporary delay on collection to outright forgiveness of the debt, including penalties and interest. Our tax lawyers can help you:
Stop IRS Collections
We can help you get proactive with your taxes. Our attorneys can contact the IRS and secure a hold on collections while developing a long term resolution strategy. Whether you are being contacted by the IRS' Automated Collection Division (a call center), or an agent is coming to your home or business, we will protect your rights.
Release Tax Liens
There are several avenues available for releasing tax liens. Incorrect or procedurally faulty liens can be appealed. Liens can also be subordinated (placed in a secondary position) if the taxpayer wants to make a partial payment by borrowing against an asset. Certain installment agreements allow the taxpayer to have the lien lifted after several payments are made.
Correct Tax Bill Errors
Our firm belief is you should never pay more than you are legally obligated. There are countless ways in which your tax bill can be overstated. We are going beyond interest and penalties, and actually look at the tax balance that you owe. There are numerous ways in which your tax bill can be incorrect: an unanswered audit letter, or failure to file an accurate tax return. We have extensive experience with correcting and appealing erroneous tax assessments.
Settle Back Taxes
The tax code provides the IRS with authority to settle back taxes, penalties and interest. The Offer in Compromise program is a great tool for achieving freedom from your tax debt. The IRS is able to settle the tax bill if you can prove that you don't actually owe or can't ever manage the tax debt. The IRS will go through extensive investigation to determine if you qualify for this program. Unfortunately this program does not work for every taxpayer. Knowledge of the tax rules and careful planning are vital for settlement success.
Abate Tax Penalties
IRS will allow relief for certain penalties if the taxpayer can show reasonable cause. This is basically a petition to the government explaining your reasons for not complying with the law. If you filed late or paid late, you will need to detail the factors that prevented you from complying with the requirements.
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