Tax Problems and Tax Secrets You Need to Know

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There are common tax problems and secrets everyone should be aware of.

Each and every year, millions of individuals and businesses find themselves in some sort of tax trouble with the IRS. Whether it is a small oversight or a large amount of back taxes, penalties, or interest due, the IRS will make sure that you are notified and that you make an effort to pay what is owed. The trouble is, many people simply can’t afford to pay the taxes they owe because of the pressure of monthly expenses and bills.

People are afraid the IRS will take all their income, their bank account, or their home. Don’t worry, there are methods of minimizing what you are required to pay and you will still have enough money to eat and pay bills. Sometimes nothing needs to be paid, or you simply pay pennies on the dollar.

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Dealing with the IRS on your own is like representing yourself in a court of law.

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Offer in Compromise, Penalty Abatement, Installment Agreements, and Currently Not Collectible are all programs to help a taxpayer in trouble. Trying to deal with the IRS on your own is like representing yourself in a court of law with no legal representation. Any information that you tell or provide to the IRS can hurt your case and cause you to pay more than you really should! Most people do not have enough knowledge of the IRS collection process or the skills necessary to submit an Offer in Compromise that is in their best interest. Many fill out the forms incorrectly, overstate their income and assets, and offer too much! About 75% of the OICs are returned at the beginning of the process due to incorrect forms. Of the 25% that the IRS processes, another 50% are rejected because the form was not filled out correctly. Experienced professionals in this area know the tricks to minimize what you would have to pay otherwise. Here are a few tax secrets you should know when working with a CPA:

• A CPA and client have client/attorney privilege in these civil matters. This privilege is not solely reserved for attorneys.
• Tax attorneys, CPAs, and enrolled agents have direct lines to the IRS and the ability to immediately access information regarding your IRS situation.
• In some cases, a portion or all of our fees are allowed by the IRS as a necessary expense in determining an Offer in Compromise. This will reduce your offer and save you money.
• If your allowable monthly expenses exceed your monthly income, you may not be required to make any payment to the IRS.
• Your account may be classified as non-collectable while the statute of limitations continues to run. 

If you have tax problems, you should protect yourself by hiring a qualified tax problem specialist. If you have any questions, please don’t hesitate to contact me. I would be happy to help you!