What is more stressful than owing the IRS back taxes? How about owing the IRS back taxes that your spouse or ex-spouse incurred without your knowledge? In the U.S., if your spouse owes the IRS money, it automatically means you share the burden and liability to pay it back. Fun, right?
So how do you exonerate your IRS liabilities when you had nothing to do with the back taxes that your spouse owes? The good news is the IRS does offer an escape for qualified people under the Innocent Spouse Tax Relief option.
Read on for some basics of how to settle your tax liability with the Innocent Spouse Relief:
What is the first step I need to take to obtain Innocent Spouse Tax Relief?
You will need to file Form 8857, a Request for Innocent Spouse Relief with the Internal Revenue Service. Once you file for an Innocent Spouse Claim, the IRS will send you a questionnaire for the purpose of verifying the validity of your story.
It’s a good idea to consult with an experienced tax attorney or Certified Tax Resolution Specialist to help you through the process of sharing your financial information in innocent spouse cases as well as help you craft any additional letters or documentation that will bolster your case.
Once everything is filed, it may take as long as six months for the IRS to contact your former spouse, review the evidence, and render a decision.
Can I file for innocent spouse tax relief without informing my former spouse?
Unfortunately, there is no way to seek innocent spouse tax relief and circumvent a former spouse. In this case, former spouse is defined as officially divorced, legally separated, widowed, or living in a separate household for a 12-month period with no expectation of their return.
The IRS is bound by law to inform the other party of the proceedings, regardless of your history with him or her, or the reasons behind the divorce.
Some victims of domestic violence choose an Offer in Compromise Doubt as to Liability process instead of an innocent spouse defense for resolving their back taxes. Ask your tax attorney or Certified Tax Resolution Specialist about all of your options so you can choose the path that is best for you.
My former spouse has already filed a Form 8857, Request for Innocent Spouse Relief. Can I file one, too?
Yes, both spouses may file for innocent spouse relief for the same year’s tax liability.
Bottom line is, don’t get stuck paying for your spouse’s mistake when you didn’t know about it in the first place. Free yourself from this serious tax burden through Innocent Spouse Relief and move on with your life without IRS tax problems.
If you need expert tax help, don’t hesitate to pick up the phone and call a tax attorney or Certified Tax Resolution Specialist. At Tax Resolution Services, we are dedicated to providing affordable expert tax help to taxpayers like you so that you can live your life without the stress and anxiety of tax problems. Call us today at (888) 699-7630 or visit www.TaxResolution.com for a free tax relief consultation.
In recent tax relief news, the Seventh Circuit Court of Appeals ruled that the IRS can continue to apply the two-year deadline for taxpayers looking to file for “innocent spouse” relief. Basically, this treasury ruling upholds that taxpayers claiming innocent spouse tax relief must make their claims within 2 years of the IRS’s commencement of collection action.
What is meant by an “innocent spouse”?
Answer: When you and your spouse file a joint tax return, both of you are therefore “jointly and severally” liable for any taxes due. Many married taxpayers do this because of certain benefits this filing status allows. If you did so, you may be held responsible for monies due, even if your spouse earned all of the income. And this is true even if a divorce decree states that your spouse will be responsible for any amounts due on previously filed joint returns.
However, if you qualify for Innocent Spouse Relief, you may not have to pay the tax, interest, and penalties related to your spouse (or former spouse).
For example, if it is later shown that one spouse had unreported income, the other spouse may try to escape civil and/or criminal liability for the tax on that unreported income under the “innocent spouse” rule. To claim this protection, the innocent spouse must neither have known about the understated income (or other tax) nor could have reasonably known about it.
The “innocent” spouse not only avoids tax liability but also provides a safe harbor for the family assets.
How does this affect taxpayers?
Fellow tax blogger, Paul L. Caron (Tax Prof) points out that the previous court ruling followed the statute in not imposing a deadline for ‘innocent spouse’ filing. However, this new court decision puts in place a two year deadline (from commencement of the IRS’s collection) for claiming for innocent spouse relief. This shows the IRS’s push for a deadline for this tax relief option.
Judge Richard A. Posner writes, “The Tax Court’s basic thought seems to have been that since some statutes (in this case, some provisions of a statute) prescribe deadlines, whenever a statute (or provision) fails to prescribe a deadline, there is none. That is not how statutes that omit a statute of limitations are usually interpreted. Courts ‘borrow’ a statute of limitations from some other statute in order to avoid the absurdity of allowing suits to be filed centuries after the claim on which the suit was based arose.”
To read more about this ruling, read the full article or for thoughts and views on the ruling, check out the Tax Prof’s blog.
This reserved ruling shows the IRS’s persistance and strictness in regulating collection of taxes, back taxes and delinquent tax returns. As the most fierce collection agency on the planet, the IRS is serious in its pursuit of delinquent tax returns and taxpayers’ tax debts. If you are a taxpayer who has back taxes, interest and penalties over your tax problems, you need the help of an expert tax attorney or a Certified Tax Resolution Specialist. If you’ve decided to seek the tax relief you need, give yourself a peace of mind by knowing your tax problem, no matter how serious, is taken care of in an efficient and professional manner. If you feel the innocent spouse tax relief could be a viable option for you, contact our expert team of tax attorneys and specialists or read more on our innocent spouse page.
Tax Resolution Services, Co. is dedicated to providing affordable solutions to businesses and individuals alike who find themselves in trouble with the IRS. For more information or to receive a free innocent spouse tax relief consultation, visit www.TaxResolution.comor call (888) 699-7630.
How does that old saying go? If you can’t beat them, join them. This message is for all the people who think they can beat the IRS by cheating on their taxes, filing fraudulent tax returns or hiding their income. If I have to spell it out for you, I will. The bottom line is, you can’t beat the IRS. So you might as well join the masses of US citizens that diligently pay their taxes every year. And if you feel that you can’t pay what you owe, then you need to seek out professional tax help. For example, Tax Resolution Services has a team of tax attorneys and Certified Tax Resolution Specialists that are available to help you get tax relief. The IRS has payment plan options, a program that allows you to pay less than what you owe (Offer in Compromise) if you qualify, allows you to file delinquent tax returns, offers tax relief for innocent spouses and much more. Believe it or not, the IRS can be flexible, especially when you’ve got a tax expert guiding you through the hoops. The IRS is not flexible only when you cheat on your taxes! You can pretty much expect prison time and a hefty fine each time!
Robert L. Braddy Jr., 39, of College Park, Ga., was sentenced to two years and six months in prison for income tax evasion. He was also ordered to pay $306,906 in restitution.
Braddy was immediately remanded to the custody of the U.S. Marshals Service at the conclusion of the sentencing hearing.
According to court records, when Braddy filed his 2003, 2004 and 2005 federal income tax returns, he willfully attempted to evade a large part of the income tax he owed the United States by filing a false and fraudulent U.S. Individual Income Tax Return (Form 1040).
For each of the returns he filed, he knew that his total income and the tax due and owing substantially exceeded the amounts he reported.
Braddy under reported his income by more than $1.1 million and underpaid his income taxes by $306,906
“This defendant hid $1 million in income and cheated his fellow citizens who pay their fair share of taxes. Now he is going to prison,” said United States Attorney Sally Quillian Yates in a statement.
I see tax cases every day where a person has evaded taxes, hidden assets, failed to file a tax return and more. What happens to their spouse (or ex-spouse) if they had nothing to do with the bad tax decisions of their partner? These situations occur and the IRS has set up a provision for people in this situation, provided that they qualify. It is known as Innocent Spouse Relief (or Tax Relief for Innocent Spouses) and if you find yourself in a tax problem that you had no idea about, and believe that you may qualify for Innocent Spouse Tax Relief, contact Tax Resolution Services to help you sort this through. Why face prison and hefty fines and a criminal record if your spouse foolishly thought that he could declare only $5 in income and get away with it?
Reginald Caillouet Jr., 61, of Houma, La., was charged in a one-count bill of information with tax evasion.
According to court records, in April 2006, Caillouet attempted to evade paying approximately $43,487 in income tax by filing a false 2004 tax return that stated he did not have any tax due. Caillouet said his income for 2004 was only $5, when in fact, as Caillouet well knew, his taxable income was at least $117,928.
If convicted, the Louisiana man faces up to five years in prison and a fine of up to $100,000 as well as two years of supervised release following any prison term.
Because unpaid employment taxes/unpaid payroll taxes are considered trust taxes, these are the toughest IRS payment plans to negotiate. Collecting unpaid employment taxes/unpaid payroll taxes is a top priority for IRS. If you want business tax relief, you will need a tax attorney or Certified Tax Resolution Specialist to educate you on the best business tax relief solution for your specific situation.
It’s no secret that the Internal Revenue Service is making a huge effort to collect every last cent of unpaid employment taxes or unpaid payroll taxes the government is owed. In that spirit, the IRS is cracking down on small businesses with unpaid payroll taxes and past due employment taxes, which until recently have largely flown under the radar. Any company with unpaid employment taxes or delinquent payroll taxes has committed a federal crime and can expect devastating results. If you have unpaid employment taxes or unpaid payroll taxes and are in need of business tax relief, here is what you need to do.
Unpaid employment taxes/unpaid payroll taxes tip #1: Understand the gravity of your situation.
The IRS views unpaid payroll taxes and unpaid employment taxes as theft, and they carry severe consequences. Aside from penalties (33% plus interest at 16 days past the day you should have filed the 941 – payroll tax return) and prison time, the IRS can padlock your business’s doors without a court order, seize your equipment and contact your customers to intercept any future payments owed to you.
The IRS doesn’t care whether you stay in business or not – just as long as all unpaid employment taxes or past due payroll taxes owed are accounted for. You need business tax relief and negotiating a properly structured payment plan or IRS installment plan can help you manage your cash flow and cut new penalties in half.
Unpaid employment taxes/unpaid payroll taxes tip #2: Get professional advice NOW.
Even more than a personal audit, an unpaid payroll tax or delinquent employment tax investigation has the power to destroy you and the people who work for you. The IRS has subjective thresholds it uses to determine who was culpable in failing to file and/or pay unpaid employment taxes or unpaid payroll taxes. They can assess the Trust Fund Recovery Penalty (TFRP) and go after anyone and everyone including company owners, officers, shareholders, CPAs, accountants, EAs and bookkeepers.
You might be tempted to represent yourself before the IRS in your bid for business tax relief. Don’t. This is the equivalent of defending yourself against murder charges without a lawyer. You are in over your head and have too much to lose.
To get business tax relief, it is vital to get professional help from a tax attorney or Certified Tax Resolution Specialist to protect you, your company and employees. A qualified professional will be able to negotiate for business tax relief in the form of an IRS payment plan or IRS installment plan for your unpaid payroll taxes or unpaid employment taxes. A good tax attorney or Certified Tax Resolution Specialist will tell you how best to move forward so you can get the business tax relief you need and keep your livelihood.
Unpaid employment taxes/unpaid payroll taxes tip #3: Move fast to protect your business.
The IRS prioritizes collecting unpaid employment taxes or unpaid payroll taxes. They accelerate the unpaid payroll tax or unpaid employment tax notice process, so it behooves you to move fast. Make no mistake, you have committed a federal crime. The money collected from employees to pay their shares of federal withheld tax, FICA and Medicare (Social Security) should have been paid to the federal government within three days after the pay date of the payroll checks.
If you are a candidate for business tax relief, contact a tax attorney or Certified Tax Resolution Specialist today. The penalties assessed on unpaid payroll tax/unpaid employment tax deposits or filings can increase dramatically in a matter of months. If you don’t take immediate business tax relief action to deal with past due payroll taxes or unpaid employment taxes (and their escalating penalties) and get yourself on and IRS payment plan or IRS installment plan, you will find yourself out of business.
Unpaid employment taxes/unpaid payroll taxes tip #4: Be prepared to defend your proposal for yourself as well as your business point by point.
The IRS moves fast, but with the help of a tax attorney or Certified Tax Resolution Specialist you can move faster towards attaining business tax relief. Because the IRS has almost unfettered powers to seize and liquidate, they are seldom in a mood to meet their victims half-way. To get business tax relief you need the expertise and nerves of steel that an experienced tax attorney or Certified Tax Resolution Specialist brings to the table when negotiating an IRS payment plan.
A tax attorney or Certified Tax Resolution Specialist will be able to analyze and articulate the real value of your business, taking every unique factor into consideration. The IRS will likely require you to submit a full set of financials for the business as well as for yourself. Your tax attorney or Certified Tax Resolution Specialist will submit a proposal for a business tax relief IRS payment plan or IRS installment plan and negotiate every federal objection point by point.
Unpaid employment taxes/unpaid payroll taxes tip #5: Don’t settle when seeking expert and experienced tax relief.
Your tax relief professional should understand your needs as a business owner for working capital and cash flow to keep your businesses running. A qualified tax relief professional knows that there’s more at stake for you than cutting a deal with the IRS to save money – resolving you payroll tax issues is about saving the financial future of your company.
In this weak economy, many businesses – both big and small – are struggling to make their payroll tax deposits and many are falling behind. Delinquent employment taxes can be the “kiss of death” for many business owners as IRS payroll tax penalties can add up quickly. Payroll tax debt should not be taken lightly – IRS levies on wages and bank accounts can cause you to lose your business. Fortunately, there’s a solution to every problem.
Helpful articles for resolving payroll tax problems:
For more information on achieving a tax resolution for your employment tax problems, visit www.taxresolution.com for a free tax relief consultation or call 866-IRS-PROBLEMS.
Michael Rozbruch, one of the nation’s leading tax experts, is a Certified Tax Resolution Specialist (CTRS), licensed CPA in the state of Maryland and the founder of Tax Resolution Services (http://www.taxresolution.com/). He teams up with an expert staff of tax attorneys, CPAs, and tax relief professionals to help individuals and small businesses solve their IRS problems with tax liens, unfiled back taxes, offers in compromise, wage levies, tax relief, delinquent returns, tax debt installment plans, bankruptcy and protecting an innocent spouse from unfair tax burdens.
With a record number of bankruptcies filed in the last year it’s important for taxpayers to know whether it’s possible to discharge taxes in bankruptcy. If you qualify for discharging your IRS tax debt through bankruptcy, you have an opportunity to achieve permanent tax relief and a fresh start. Find out more about eliminating your back taxes with these important tax relief bankruptcy tips.
Most taxpayers don’t realize that IRS tax debt may be eligible for discharge in bankruptcy. Record numbers of people filed bankruptcy last year because they lost their jobs or they lost their pension or maybe had a catastrophic life event that then caused their financial world to fall off a cliff.
Sometimes tax relief bankruptcy is the most appropriate course of action when you have a big IRS tax problem. And other times it’s not- and something like the Offer in Compromise program may be a much better option than tax relief bankruptcy.
Bankruptcy is an option used by the world’s biggest businesses as well as the humblest individuals. Obtaining tax relief through bankruptcy can give people a fresh start. Some people may think bankruptcy is a way to sneak around the system, but the purpose is actually to level the playing field so that people can permanently resolve their tax problems once and for all.
Bankruptcy does not always remove all tax liabilities. Not all IRS taxes, penalties, and interest qualify for complete 100% discharge. In order for a taxpayer to benefit from bankruptcy laws, it is important to get expert tax help from an IRS tax attorney or Certified Tax Resolution Specialist to determine whether or not your tax liabilities are eligible for discharge.
If you qualify for discharging your tax liabilities through bankruptcy, you can get massive tax relief from the government. However, only a seasoned tax attorney, CPA or Certified Tax Resolution Specialist can provide tax help to show you the proper sequence of events to declare bankruptcy and completely eliminate all of your back taxes, if you are eligible.
In October 2005, Congress enacted the Consumer Bankruptcy Law – including big changes that affect the ability to discharge income taxes. Therefore, it is highly recommended that the taxpayer seek out experienced legal counsel from a tax attorney or Certified Tax Resolution Specialist who specializes in tax relief bankruptcy.
Before you get started down the path of tax relief bankruptcy, here are a few tips.
Tax Relief Bankruptcy Tip #1: Does your debt consist of taxes, or everything but taxes?
Sometimes tax relief bankruptcy is the most appropriate course of action when you have a big tax problem. And sometimes it’s not. The first test to see if bankruptcy will give you maximum tax relief is to start with the question “What is your biggest problem? Is it everything BUT taxes, or is it the taxes?” If you have lots of creditors that you are having trouble paying, bankruptcy may be your best option. If your only major creditor is Uncle Sam, a tax attorney or Certified Tax Resolution Specialist can help you consider additional back tax relief options like an IRS installment agreement that may be a better fit depending on your exact circumstances and the tax relief solutions you qualify for.
Tax Relief Bankruptcy Tip #2: Get the maximum tax debt forgiveness with the right kind of bankruptcy.
There are three types of bankruptcies:
• Chapter 7: Chapter 7 is what everyone wants. Chapter 7 is total tax debt forgiveness, wiping out everything. The bankruptcy laws changed a few years back. These days you have to get your tax tax attorney or Certified Tax Resolution Specialist to petition a judge to grant Chapter 7. There’s now a financial means test that mirrors very closely the IRS test for the Offer in Compromise program. A financial means test means that you have to prove you can’t pay. Your assets are significantly less than what you owe. You don’t have to be destitute, but if the tax debt is so massive compared to your assets that you’re upside down or insolvent, then that’s obviously a key test to be a Chapter 7 candidate. Chapter 7 is complete forgiveness. It wipes off the plate. And that’s called discharge. You want the discharge to get total tax debt forgiveness. If Chapter 7 is not possible – and bankruptcy tax attorneys have to be a lot more rigorous around this than they had been in the past – the bankruptcy tax attorney is supposed to then submit a petition for a Chapter 13.
• Chapter 11: Chapter 11 is primarily used by businesses as a form of a business reorganization that allows you to negotiate with your creditors to restructure debts so that your business can emerge from bankruptcy with a sustainable debt load. If you are self-employed and/or incorporated, consult with a tax attorney or Certified Tax Resolution Specialist about how you can use Chapter 11 tax relief and debt relief to make your business stronger.
• Chapter 13: A Chapter 13 is basically a structured payment plan. It’s called a Wage Earner Plan. It is very similar to the Offer in Compromise program, but gives you a big hit on your credit report for the next 10 years.
Tax Relief Bankruptcy Tip #3: Know when bankruptcy is a better option than an Offer in Compromise.
The IRS’s Offer in Compromise program is a fresh start program, and sometimes it’s a much better option than bankruptcy. In many instances the tax obligation can be reduced, without the burden of a bankruptcy on your credit report for the next 10 years. So it’s important to consult with a tax attorney or Certified Tax Resolution Specialist to discern the benefits of different tax debt solutions for your case.
Tax Relief Bankruptcy Tip #4: Business bankruptcy is different from personal bankruptcy.
Many self-employed people have incorporated as a business. Incorporation provides you with personal protection from tax debt. Depending on the laws in your state, you can simply declare bankruptcy and dissolve your corporation with no impact on your personal credit history. Ideally under this scenario your corporation’s tax debt vanishes in a poof of smoke with no personal liability but in reality you’ll need to consult with a tax attorney or Certified Tax Resolution Specialist to work out the details in your case.
Bankruptcy is sometimes the best option, but it will haunt your credit report for the next 10 years. When there aren’t any other significant debts, an IRS tax attorney or Certified Tax Resolution Specialist can help you significantly reduce your tax obligation through less drastic means. But if you go down the bankruptcy path, take heart. Learn how to file for bankruptcy correctly before proceeding. In many cases, people can reestablish their credit history in as little as two years.
The Tax Resolution Services expert team of tax attorneys, CPAs, and tax relief professionals helps individuals and small businesses solve their IRS problems with tax liens, unfiled back taxes, offers in compromise, wage levies, tax relief, delinquent returns, tax debt installment plans, bankruptcy and protecting an innocent spouse from unfair tax burdens. For a free tax resolution consultation, call our office today at 1-866-IRS-PROBLEMS or visit www.taxresolution.com.
There are only two days left until the April 15th tax filing deadline.
For taxpayers who are not yet ready with their tax returns, it’s time to buckle down. Whether you haven’t filed your taxes because you’ve been busy or because you don’t have enough money to pay your taxes in full, it’s time to get serious about your tax return in order to avoid IRS tax problems.
I recently appeared on the Big Biz Show to share some last minute filing tips to taxpayers who want to avoid IRS tax problems. Read on for tax help advice on how you can save yourself from severe IRS penalties this tax season.
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How Innocent Spouse Defense Can Save You
Question: What is Innocent Spouse defense and how can this relieve someone of their joint tax liabilities?
Answer: First and foremost, you can only qualify for Innocent Spouse defense if you’re divorced and signed a joint return for the year in question. Normally, if the husband has a side business with its separate banking account and gets caught for evading his taxes, the IRS can come after both the husband and the wife for the amount owed. If the wife can prove that she 1) did not know about the business and the tax evasion and 2) she did not benefit from the tax evasion of the business (i.e. living a more lavish lifestyle), then she can qualify for Innocent Spouse as long as she is divorced from her husband.
It’s a tricky situation and you definitely want to make sure that you’re going to be mired in IRS trouble for someone else’s mistakes.
What to Do If You’re in IRS Debt
Question: What is your advice for people who are in so much IRS tax debt that they don’t know what to do or where to start?
Answer: There’s a solution to every problem. I have met people who owe the IRS almost $1 million and they’re able to settle an Offer in Compromise agreement with the IRS so that they can pay off their debt in installments. It’s not often that taxpayers end up owing the IRS that much money, but even if you do–you can get tax help to resolve your IRS problems.
It is also important to remember that the IRS is willing to work with you. If you can only afford to pay “X” instead of “Y” per month to resolve your back taxes, they are flexible enough to extend your payment period to accommodate for that. This is called a “partial pay installment agreement.” Speak to a tax attorney or Certified Tax Resolution Specialist about how you can qualify for this if you are in IRS debt but can’t afford to pay.
Tax Filing Procrastinators–What to Do Now?
Question: So what if I still haven’t filed my taxes and it’s April 15th in a day? What should I be doing right now?
Answer: If you’re filing an extension, you need to be paying in about 100% of what last year’s tax liability is or you’re going to owe money. What you need to do is sit down with your documents right now, categorize them or divide them by category, not by month, and start doing your tax return.
Remember to review your social security numbers, carefully check them, make sure you didn’t transpose them. Double-check your figures if you’re doing this thing by hand, make sure your arithmetic is correct. Because if it’s not, it will generate a red flag and an IRS audit. Remember to sign and date your return, I cannot believe how many people send in their tax return and don’t sign it. That doesn’t count as a filed return.
Even if you’re filing for an extension, you still need to give the IRS an estimate. So either way, you need to sit down and crunch your numbers. You may as well get the tax return done while you’re at it.
Do I Need to Pay the Alternative Minimum Tax?
Question: What is the alternative minimum tax?
Answer: The short version of alternative minimum tax is if a taxpayer claims too many deductions and ends up having no tax liability, the government will intervene and say “no, you have to pay at least this amount ‘x’”. So you definitely want to be careful with your deductions and make sure that you’re claiming legitimate ones you can prove.
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Remember, it’s not the end of the world if you’re mired in IRS tax trouble. There will be a IRS tax relief solution that can get you through–just don’t hesitate to ask for tax help.
Tax Resolution Services is a team of expert tax attorneys, CPAs, and Certified Tax Resolution Specialists who are here to help you with your tax problems. You can call our office at 1-866-IRS-PROBLEMS or visit www.taxresolution.com for a free tax resolution consultation.
An experienced tax attorney or Certified Tax Resolution Specialist (CTRS) can help taxpayers secure offer in compromise settlements, IRS payment plans, penalty abatement, innocent spouse relief, release of liens or levies, non-filer issues and many other tax settlements. Before you hire professional tax help for resolving your IRS problems, you need to get informed on how to choose a good tax relief expert.
While taxpayers are allowed to represent themselves before the IRS, many taxpayers seeking tax relief find dealing with the IRS frustrating, time-consuming, intimidating or all of the above. So they make the decision to hire professional tax help (specialized tax attorney, tax resolution firm, etc.) to negotiate with the IRS on their behalf. An experienced tax attorney or Certified Tax Resolution Specialist (CTRS) who specializes in providing tax relief to individuals and businesses can help resolve tax problems at both the state and federal level. So how can you hire a tax resolution firm you can trust? Before you hire a tax resolution professional, check out these top tip for choosing a good tax relief expert to help you resolve your IRS problems.
Tax Relief Professional Hiring Tip #1 – Understand the cost of going solo: There are many advantages to hiring an income tax attorney or Certified Tax Resolution Specialist, but the greatest advantage is peace of mind and knowing that you are not taking unnecessary risks with your personal and financial freedom. Going in front of the IRS without a tax attorney is like defending yourself in a murder trial. You’ll get creamed. To paraphrase the wise old saying, “He who acts as his own tax attorney has a fool for a client.” Even if you can’t afford to pay your back taxes or have years of unfiled delinquent tax returns, a Certified Tax Resolution Specialist or tax attorney can help you settle your IRS debt by increasing your chances of resolving your back taxes and helping you qualify for a tax relief settlement where you only pay back only a fraction of what you owe.
Tax Relief Professional Hiring Tip #2 – Don’t be penny wise but pound foolish: Even when you know you need a tax attorney, it can still be a difficult decision to make when faced with their fees. However, know that not getting professional tax help can be even more costly. To get the tax relief you need, you need to leverage the specialized knowledge that only an expert income tax attorney or Certified Tax Resolution Specialist can provide. In many instances, retaining professional and reliable tax attorney and tax resolution services will often result in more affordable and IRS payment plans and lesser tax penalties. However, when you owe back taxes and you need a tax attorney’s help to get the tax relief you want, the issue at stake is more than just what’s on your balance sheet. Issues with back taxes and other IRS problems can be both financially and personally crippling – so you will want to resolve them swiftly and permanently.
Tax Relief Professional Hiring Tip #3 – Understand your tax settlement options: Your tax attorney or Certified Tax Resolution Specialist should help you understand the process for resolving tax debt so that you have realistic expectations for solving your specific tax problem. Because the IRS has very strict guidelines governing eligibility for tax settlement, your tax relief professional needs to let you know up front what tax settlement options are viable for and resolving your specific IRS problems.
Tax Relief Professional Hiring Tip #4 – Know that every tax relief case is different: To get the tax relief you need, you will need personalized attention rather than a one-size-fits-all approach to tax resolutions. Beyond being able to leverage the specialized knowledge only an income tax attorney or Certified Tax Resolution Specialist can provide, you will want to choose a firm with extensive experience and an exceptional track record for tax relief success to help ensure your unique case is in good ands.
Tax Relief Professional Hiring Tip #5 – Look for a firm that offers transparency: It’s unfortunate that there are some tax relief firms out there that will lowball their initial fees – without letting taxpayers know about additional fees that may be involved further down the road. This is a popular tactic that firms use to secure a client. They start the process by quoting entry-level fees – intentionally leaving out the fact that the offer in compromise process can take up to 6-7 months. Because a high percentage of Offers are rejected by the IRS, these cases often have to go to the appellate level – at which point these firms will then turn around and hit the client with additional appellate representation fees. You will want to choose a firm that will help you understand exactly what’s involved with achieving a settlement for your specific IRS problem.
Tax Relief Professional Hiring Tip #6 – A tax attorney will keep you out of future IRS trouble: Hiring a professional tax attorney and tax resolution services can not only help you resolve IRS problems from the past, but it can also help you achieve permanent tax relief, making sure you don’t run into tax problems in the future.
Hiring a good Certified Tax Resolution Specialist (CTRS) or tax attorney can help significantly increase your chances of securing offer in compromise settlements, IRS payment plans, penalty abatement, innocent spouse relief, release of liens or levies, non-filer issues and many other tax settlements.
For more information on how to get IRS tax relief, visit www.taxresolution.com for a free tax relief consultation or call 866-IRS-PROBLEMS.Our team consists of an expert staff of tax attorneys, CPAs, and tax relief professionals to help individuals and small businesses work together to solve their IRS problems with tax liens, unfiled back taxes, offers in compromise, wage levies, tax relief, delinquent returns, tax debt installment plans, bankruptcy and protecting an innocent spouse from unfair tax burdens.
Michael Rozbruch, Certified Tax Resolution Specialist (CTRS) and a member of the American Society of IRS Problem Solvers, has a special message for you:
Whether you’d like to avoid the IRS, contact the IRS, settle with the IRS or just want to refer a friend, relative or client, I’d love to hear from you. I would be happy to provide you or that special person you refer a no-obligation confidential tax consultation to explain every option available to solve IRS problems.
As taxpayers are getting ready to file their 2010 tax returns, an important thing to remember is to only claim deductions that you can substantiate with evidence. This is an easy way to avoid incurring the wrath of the IRS–do not deduct “business” expenses that are personal!
I have blogged about many cases before where individuals were subjected to IRS penalties for falsely claiming business expenses as a part of their deductions. When requested to bring evidence to support these deductions, these individuals were unable to produce them.
Remember, if the IRS suspects you of falsely claiming tax deductions, you are guilty till proven innocent. This means if you do not have the documents to back up your deductions, you are guilty and will be slammed with IRS penalties–whether or not the deductions were actually legitimate. So don’t make the mistake of being slammed by IRS penalties simply because you threw away your records.
Just recently a couple was penalized for claiming false business expenses because they had incorporated their insurance business as a method of tax-evasion.
CCH (http://intelliconnect.cch.com) reports:
Couple’s Claimed Business Expenses Were for Tax Avoidance, Penalty Imposed
A married couple could not deduct expenses they claimed from the husband’s insurance business for the years in issue because they failed to prove that the payments were ordinary and necessary expenses in carrying on a trade or business. Their testimonies that the payments made to their daughters were for services rendered to the business and that other payments made were for furtherance of the business were self-serving. Their documentary evidence did not have any economic reality beyond tax planning.
The creation and incorporation of the purported insurance business was for tax-avoidance. The claimed expenses for wages, rent, management services and other expense, were not for rendered services or connected with their insurance business, but were actually payments of the couple’s nondeductible personal living expenses and for their personal residence expenses. To bolster the chances that they would succeed in achieving their tax-avoidance objective, they created a fictitious paper trail that included a purported management consultant agreement, a purported employment agreement, a purported medical and dental reimbursement plan, purported real estate installment documents, a purported educational assistance plan document and a purported automobile installment sale agreement.
The taxpayers were liable for the accuracy-related penalty for the years in issue because they substantially understated their tax by claiming deductions to which they were not entitled. The taxpayers failed to carry their burden of establishing that there was reasonable cause for and that they acted in good faith with respect to any portion of the understatement of tax.
Don’t start off 2010 with new IRS problems. Avoid IRS penalties by making sure that your information is accurate and truthful on your tax returns. Always keep a careful record of your business expenses so that you can back up your tax return if the IRS requests evidence.
Tax Resolution Services is a team of tax attorneys, Certified Tax Resolution Specialists, and CPAs who are here to offer your tax help. You can call our office today at 1-866-477-7762 for a free tax resolution consultation or visit www.taxresolution.com.
Business owners and freelance professionals alike must be aware of the importance of keeping careful records of their business expenses in order for these tax deductions to be accepted. A good tax attorney can only do so much to help your case if you do not have strong evidence to support your tax claims.
I have blogged about news stories of unsubstantiated tax deductions in the past where taxpayers who were unable to provide evidence of their business expenses were disallowed from receiving tax deductions. A tax attorney can only help you file documents if they still exist.
In this economy where money is tight, don’t risk losing out on your tax deductions by not keeping important documentations of your business expenses. I always encourage taxpayers to keep their tax-related documents carefully in case they need to substantiate their tax claims in the future.
CCH (http://intelliconnect.cch.com) reports:
Some Estimated Employee Business Expenses Deductible, Other Unsubstantiated Expenses Disallowed
An individual was allowed to deduct an estimated amount of unreimbursed employee business expenses; however, deduction of other unsubstantiated expenses was disallowed. Although the individual had recorded mileage in a day planner, the day planner was later discarded, and the individual did not attempt to reconstruct the record. Similarly, he was unable to show receipts or other evidence of his expenses for an overnight business trip. However, he was allowed to deduct an estimated amount of his other unreimbursed employee business expenses, in light of the record and his highly credible testimony.
As the year draws to a close and many taxpayers are starting to prepare their tax planning for 2010, it’s a good idea to not throw away any documentation that may be useful to your tax filings.
This is very similar to the recent case of the federal tax lien filed against California Governor Arnold Schwarzenegger–proving once again, that no one is immune from the IRS grasp.
Don’t risk losing out on money that is entitled to you. Save your expense records to save your funds.
James L. Jensen and Robin L. Jensen of Cordova, Alaska, were indicted in Anchorage on charges of evasion of tax payments, filing false income tax returns, and failure to file tax returns.
According to the 12-count indictment, James Jensen is a commercial fisherman, and James and Robin Jensen owned a cabin-rental business called Bear’s Den Cabins. According to the charges, James Jensen attempted to evade paying his taxes for years 1994, 1995, 1996 and 1997 – which, by 2001, exceeded $200,000 – by sending the U.S. Secretary of the Treasury a fictitious financial instrument called a “Bill of Exchange.”
The indictment also alleges that he created a number of nominee entities, including a trust and two corporations — “Eyak River Ministries” and the “Rhema Foundation” — in an attempt to hide income and assets.
Other counts allege that for tax years 1998, 1999 and 2000, the Jensens filed income tax returns with false deductions and expenses that resulted in payment of no taxes. Finally, the indictment alleges that for tax years 2004, 2005, 2006 and 2007, they failed to file income tax returns.
They face up to five years in prison and a fine of up to $250,000.
Failing to file your tax return is a crime punishable by prison time and a hefty fine. If you have failed to file taxes and feel like the IRS is breathing down your back, there is tax relief available. You have the right to file your original tax return, no matter how late it is! Tax Resolution Services is a professional team of tax attorneys and tax resolution specialists that can help you file your delinquent tax return also known as late tax filing. If you have failed to file taxes, like this gentleman below, consult a tax professional (fill out our online form) to help you sort through your tax problems and find tax relief.
Charles L. Boulton, 61, of La Center, Ky., was sentenced to one year and nine months in prison for failing to file tax returns. He was also ordered to pay restitution of $94,870. Boulton, a chiropractor, provided drug and alcohol tests to truck-driving schools and transportation companies in Western Kentucky. During the tax years 2001 to 2006, he earned $495,600 and did not file income tax returns for those years.
We all know that accepting bribes is not acceptable. Call it what you may, “gifts and gratuities”, but we all know that a person with a governing position, like a mayor, who accepts gifts and gratuities is basically accepting a bribe. When the bribe happens to be cash, or something of great cash value, it is still taxable. But because it is a bribe, the mayor decides to evade taxes instead. Where does this story end? I think you know the answer – many years of prison and a hefty fine. What happens, however, to his spouse? Does she go to jail too? Sometimes yes, sometimes no. Our government, after all, is understanding. The IRS has an Innocent Spouse provision and some spouses may be cleared of their partner’s tax debt if they qualify for tax relief as an innocent spouse. Sometimes an individual makes bad decisions, like this Louisiana mayor below – and it is nice to know that if his spouse is innocent from tax charges, she will not be sharing in his prison time.
The mayor of Mandeville, La., pleaded guilty to honest services mail fraud and tax evasion.
According to court records, Edward “Eddie” J. Price III, as the elected Mayor of Mandeville, was a public official who was prohibited by state law from receiving gifts and gratuities from professional service contractors for the city of Mandeville and developers with business interests with the city. From 2003 to 2007, Price accepted numerous trips from the city’s engineer and a developer in the Mandeville, La., area to participate in expensive golf tournaments in Pebble Beach, Calif. These trips had a value in excess of $45,000. Price’s plea of guilty to honest services mail fraud included admissions that he illegally utilized money from his campaign fund account to pay various personal expenses.
In addition, Price failed to file a tax return for the 2007 tax year, evading taxes on his income as mayor as well as the value of the gifts and gratuities he received and funds he had taken from his campaign account.
The politician faces up to 25 years in prison and a fine of up to $500,000.
“This investigation is another example where the teamwork between the IRS, FBI and the United State Attorney’s Office has brought justice to our community,” said IRS Special Agent in Charge Michael DePalma in a statement.
This is a story I wanted to share with you because the guy featured in this video, Gib, discovered that he was going to owe the IRS more than 35,000 dollars in back taxes, interest, and penalties. To hear how Gib was finally able to sleep at night because of a provision in the tax code called Innocent Spouse, watch the video from TRS Files now!
Gib was truly innocent of his partner’s tax tax problems and TRS helped the IRS realize this. TRS stopped the IRS from chasing Gib for his spouse’s back taxes and now he is debt free!
Gib was very satisfied and especially grateful for the “best night’s rest since he was baby” after TRS reassured him that he was was no longer responsible for the tax debt because he qualified for innocent spouse tax relief.
He has told all of his friends that if they have any problems with the IRS to be sure to call TRS because he wants his friends to experience the same quality treatment when resolving any IRS problems they have. And it was because of the the expert services provided by TRS tax attorneys and tax professionals that Gib’s tax burden was reduced to zero dollars!
If you find yourself in a tax problem with your spouse, and feel that you qualify for Innocent Spouse Tax Relief, you will need a tax professional to help you through the process. TRS tax experts and tax attorneys can help you find tax relief.
Resolve your back taxes with the IRS and call TRS now at 1-800-477-9609 for your free consultation.
News, commentary, insight, tips and humor from tax expert Michael Rozbruch
Michael Rozbruch is a Certified Tax Resolution Specialist, a member of the American Society of IRS Problem Solvers and a Maryland CPA.
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There are only two days left until the April 15th tax filing deadline.
