Seeking the assistance of tax relief professional is a decision you make at your discretion. Many taxpayers choose to sustain control of their dealings with the IRS. The IRS doesn’t dispute your rights to do so. If you have an uncomplicated tax return or owe less than $10,000 in back taxes, you may not require the services of a tax relief expert.
Unfiled Tax Returns Call for a Tax Expert
Although the IRS likely won’t drag you off to jail for not filing your tax return, they may levy a penalty. If you have a balance due after the returns are prepared and filed, you can expect to get two penalties. The IRS calls these penalties the failure-to-file penalty and the failure-to-pay penalty. The failure-to-file penalty is more expensive than the failure-to-pay penalty. If the IRS assesses one or both of these penalties, experts advise consumers to consider hiring a tax relief expert.
The IRS explained that for most taxpayers, the penalty can be as much as five percent of their unpaid taxes each month, up to a maximum of 25 percent. The penalty for late payment is usually 0.5 percent of taxpayers’ unpaid taxes per month. The IRS says, “It can build up to as much as 25 percent of their unpaid taxes. Therefore, it’s wise for taxpayers to file their unfiled tax returns as soon as they can, even if they can’t pay the bill immediately.
Usually, taxpayers find that once they miss a tax filing deadline, it becomes easier to miss it in following years. This creates complications that require the intervention of a tax relief expert. For instance, most average taxpayers aren’t accustomed with the changes in the tax code from year to year. Every return must be prepared in relation to the specific tax code of the corresponding year.
Offers in Compromise Crafted by a Tax Professional
The IRS says it generally approves an offer in compromise when the amount offered represents the most they can expect to collect within a reasonable period of time.” They evaluate taxpayers’ ability to pay, income, expenses and assets. That aid them in determining the amount of the debt he or she will be able to pay. If the offer in compromise is the same or more than what the IRS thinks they can collect, they’re more likely to approve the offer.
However, if it’s less, you have an open bankruptcy proceeding, or you have unfiled tax returns, the offer will probably be rejected. Crafting an offer in compromise is an involved and precise task. Each case states what the proper offer should be. Hiring a tax relief professional can help to ensure that the offer is efficient for acceptance.
Finally, the IRS advises the taxpayer to understand the process for an offer in compromise review. They highlighted on the following:
✔ A tax lien may be filed
✔ Collection activities are often suspended
✔ The legal evaluation and collection periods are extended
✔ The taxpayer expects to make all necessary payments associated with the offer
✔ The taxpayer can stop making payments on an existing installment agreement
✔ The offer is automatically approved if the IRS doesn’t make a decision within two years of the date the IRS receives the offer.
Wage Garnishment Can be Resolved by a Tax Relief Expert
The terrible feeling of discovering a wage garnishment is one that no one should feel. But this is one of the numerous methods of collection used by the IRS to collect back taxes. First, they send a notice to the taxpayer that notifies them of their tax balance. This letter also requests payment by a given deadline. If the payment isn’t made, they check your finances to determine the best way to collect the debt.
If they resolve that a wage garnishment is in order, they inform your employer of your status with the IRS. They then instruct them to withhold tax payments from your paychecks until the debt is cleared or other payment arrangements are made. Your employer sends the withheld funds from your check to the IRS on your behalf. While this isn’t the best method of payment for the taxpayer, it’s often one of a few payment options available.
A tax relief expert has the potential to stop the wage garnishment, as well as negotiate with the IRS. Reputable experts strive for the lowest monthly installment agreement that you qualify for. In addition, a wage garnishment may be lifted if you can’t afford the amount. The IRS says that the levy may be released if the levy is creating an immediate economic hardship. A levy release does not mean you are exempt from paying the [tax] balance.”
The IRS will release the wage garnishment if one of the following is applicable:
✔ The taxpayer pays off the total balance.
✔ The statute of limitations deadline has passed.
✔ You arrange an agreeable payment plan with the IRS.
✔ You’re unable to pay for basic needs because of the wage garnishment.
If you’re not sure if one of these events applies to you, hire a reputable tax relief expert.
Cases Handled by a Tax Relief Expert
▪ Audits
Audits are usually difficult processes. The IRS handles many of them through written correspondence, while they conduct others in-person. A reputable tax representative will handle communications with the IRS. They’ll also present the requested information to the IRS on your behalf. During an audit, the IRS can use whatever a taxpayer says in their determination. Complex industry language can be confusing, causing taxpayers to unwisely say things that may indicate wrongdoing. A tax professional helps protect a taxpayer from unintended confusion.
▪ Unpaid Payroll Taxes
Individuals may be personally responsible for their company’s unpaid payroll taxes. If you feel you may be at risk, get in touch with a tax relief expert to secure you from unnecessary tax evaluations. He or she will also ensure the lowest possible tax liability.
▪ Complex and/or Amended Tax Returns
▪ Penalty Abatements
Although the IRS evaluates penalties all the time, they’re often rational about removing them. That is, of course, if there are special cases. The IRS offers the following examples:
✔ Death, serious illness, incapacitation or unavoidable absence of the taxpayer or a member of the taxpayer’s immediate family
✔ Fire, casualty, natural disaster or other disturbances
✔ Inability to acquire records
Other reasons which ascertain that you used all ordinary business care and prudence to meet your Federal tax obligations but were however unable to do so