Tax Problem Services
Unfiled Tax Returns-Rapid Clean Up:
Ignoring the filing of your Income Tax Returns is the ultimate in procrastination which creates the worst tax scenario. There is a Statute of Limitations which prevents the IRS from going back beyond three years to audit your tax return. This time frame starts from the date you file your tax return, and of course, terminates three years from that point. So, if you have just not filed your tax returns, the IRS can effectively examine your tax returns going back for many more years than the three year time frame.
The key here is to prepare and file all your past tax returns and get that IRS statute of limitations clicking away in your favor. As a Tax Problem Specialist, my office will rapidly “Clean Up” all your unfiled tax returns, minimize your tax liabilities and follow through with a “Payment Plan” if needed. While it is highly unusual, there are times when penalties can be waived under “Reasonable Cause” for appropriate reasons. Interest is statutory and cannot be waived.
A Tax Lien is, in essence, when the IRS seizes your property and becomes the rightful owner in your place. If you do nothing to challenge this with proper assistance from a seasoned tax professional, your situation will only get worse. Do not allow the IRS to grab your life’s assets.
The Tax Strategy offices of Eric J. Engelhardt, CPA, CFP®
- with 30 years of tax experience will represent you to effectively deal with the IRS to eliminate, wherever possible, your Tax Liens. Eric has unique “Negotiating Skills” that, together with his knowledge of the Tax Laws and your tax rights, will in most cases have your Liens released promptly.
An IRS Levy does not happen overnight. You are normally sent several letters in which the IRS gives you the opportunity to pay your past due tax bills. It is only when you continue to ignore these letters that the IRS will finally issue a “Levy” against you. This can allow the IRS to garnish your wages, put a hold on your checking accounts and so forth.
There are methods to deal with an IRS Levy. One method is to prove that you absolutely do not have the capability to pay the taxes the IRS claims you owe. This needs to be proved in writing and on certain IRS forms regarding your income and expenses as well as your personal assets and liabilities. If it can be shown with supporting information such as bank statements, monthly bills, etc. then we may be able to put a hold on the “IRS Levy”.
It does take, however, a seasoned and skilled Tax Negotiator to properly present all the facts of your case to rapidly and effectively kill the Levy. It is not a good idea, as you may have heard in the past, to “represent” yourself.
The Tax Strategy offices of Eric J. Engelhardt, CPA, CFP®
- with 30 years of tax experience will represent you to effectively deal with the IRS to eliminate, wherever possible, your Tax Levy. Eric has unique “Negotiating Skills” that, together with his knowledge of the Tax Laws and your tax rights, will in most cases have your Levy stopped promptly.
Warrants and Notices:
A Tax Notice may be a mild inquiry regarding some mismatch on your tax returns, a request for payment and/or the notice may have been sent to you due to missing or unreported information on your tax return. There are times, however, that a Tax Notice is sent out in “error”. Of course, you still need to respond to clear up the issue involved.
A Tax Warrant usually is more critical than a simple “Notice” and you must get to the bottom of this quickly. A Tax Warrant is usually a prelude to a Tax Levy or Lien and is due to non-payment of your Tax Debts for an extended period of time. Once again, you should be careful here because if you decide to contact the IRS or your specific State Tax Office, you must be careful with your words....the Tax Assistance people at the other end of the telephone line are in no way your “friend”.
IRS Offer In Compromise:
An Offer in Compromise is an IRS-approved program where a person who owes a large sum of tax dollars, may, if qualified, be relieved of this Tax Debt almost entirely. So let us say you have not filed tax returns for 5 years. You catch up and file all your delinquent tax returns and find that with interest and penalties, you now owe the IRS $100,000.
There are two circumstances under which you may attempt to apply for the “Offer In Compromise”. You must be able to prove that you will never be in a position to repay the IRS the taxes you owe (doubt as to collectibility). The other approach is to show that the Tax Liability is not correct (doubt as to tax liability).
In either case, you must complete various forms to apply for the Offer. Since July 16, 2006 the IRS has made various changes to the Offer program and you are now required to deposit with the Offer application 20% of your Offer (e.g. if you offer 10,000, you must submit $2,000).
Great negotiating skills are required to get past the Offer in Compromise early stages and to make sure that your Offer is not rejected.
So, you owe the IRS a certain sum of money...now what? You do have a few choices.
One of the best ways to prevent a collection matter from becoming a Lien or Levy situation is to simply call the IRS and pay your tax bill.
If you cannot pay in full, the next step is to establish a “payment program”. Usually, the IRS will want paperwork submitted if you must pay over a period of more than six months.
There is a good chance that if you do owe the IRS taxes, you also owe taxes to your specific State. In this scenario, a seasoned Tax Pro must simultaneously negotiate with the IRS and the State. I have a Tax Strategy which has greatly assisted my clients in this situation.
Various Tax Payment Plans are available to you based upon your circumstances.
The bottom line here is that in order to set up a “payment program” you must prove to the IRS that you do, in fact, need the extra time to pay your back taxes. Keep in mind that interest and penalties do continue to grow during the payment program. However, the beauty of the payment plan is that you do avoid the Lien or Levy action.
In order to reach an agreed upon payment plan beyond 12 months, you need a skillful tax negotiator to be your advocate. Suppose you already have a payment program and your financial situation has changed for the worse. You can re-negotiate your existing payment plan with the IRS under these circumstances.
Sales Tax Issues:
While this area concerns our specific state sales taxes, a sales tax audit usually uncovers unreported sales and it is the matter of these “additional sales” that is of interest to the IRS. This is the basis for the States to assess the owner of a business additional sales tax liability for a specific period of time. It is typically the responsibility of the state to inform the IRS of the adjustment or increase in Sales.
In many cases, there may have been two partners in a business. One partner has left the US and the other partner, who may have had nothing to do with the books and records, now has a “Responsible Party” dilemma. This effectively means that the uninvolved partner is now held liable for the additional sales taxes and IRS taxes. There are certain instances where the responsible party-partner may be able to prove that he/she is not in fact, liable for these taxes. Keep in mind that sales taxes are public trust funds and the states take this area very seriously. You must have a seasoned tax advisor to handle your sales tax audit, collection matter or payment plan.
Dormant Corporation Tax Notices:
There are many people who have had a corporation at one time or another. Many of you have closed down your business without properly “dissolving” your corporation. This is quite typical and unfortunately, creates problems in the future. This lack of proper corporate dissolution will trigger notices which will be sent to the stockholders of record. These notices may come from both the IRS and from your specific state.
In most cases, you will be assessed a large minimum tax due to a lack of assets, no payroll and no gross receipts for the year in question. You still must file an inactive Corporation Income Tax Return to avoid these notices years later with interest and related penalties for non filing and interest charged on the penalties, as well. A skilled Tax Advisor may be able to clean up this mess, have penalties waived or possibly even have the base tax removed, if you have the proper proof and backup information to qualify.