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Sunday, December 20, 2009

Solutions to common IRS tax problems - easier than you think



Solving problems with the Internal Revenue Service (IRS) can either be easier than you think, or become a migraine headache. It depends upon who you get to help you.

Whatever you do - don't try it alone unless you really know what you're doing!

Avoid the Internet rip-off tax businesses. They are all over the place. Some advertise they employ "former IRS agents". So what. The average IRS "agent" is a bill collector who got a job working for the federal government. A lot of "former IRS agents" are obnoxious types who were fired by the IRS for poor performance and heavy-handed techniques. Are you sure you want losers like that representing you?

If you have a leaky faucet, call a plumber, not an electrician. If you have IRS problems, call a tax attorney - not a bookkeeper, an enrolled agent or an accountant.

The ONLY professional to retain to get help with IRS problems is an attorney at law who is a tax specialist - not just any attorney - but a tax specialist attorney at law.

Bookkeepers, enrolled agents and accountants can help you BEFORE you get into trouble, but after the problems start - you need to talk to an attorney at law.

Here are a few of the more common IRS problems and the common solutions:

1) "I haven't filed all my past tax returns and the IRS is getting ready to attach my paycheck."

From the date you receive your "Notice of Intent to Levy" letter you will have 30-days before the shoe falls. You need to file all your missing tax returns. That's why the IRS is getting ready to levy your paycheck. Usually, if you talk to them (and promise to file all missing returns ASAP) they will release the levy within 48-hours or so. After you get a temporary break, don't forget to get busy and file those returns -- or -- you'll be sorry.

2) "I owe the IRS money, so I don't want to file my past tax returns"

This is a BIG mistake. The IRS will work with you on a tax debt you cannot afford to pay, but they will NOT play games with you when it comes to filing your tax returns. Even if you cannot pay, prepare the tax returns, sign them, and send them in without the money. Do it now!

3) "I'm up to date on filing my tax returns, but owe the IRS and cannot pay. What do I do?"

This is an easy one. If you are up to date with filing all your tax returns, call the IRS or go online (www.irs.gov) and ask for an Installment Agreement. You will be able to set-up a monthly payment plan that fits within your budget, but still allows you to begin paying off your debt to America.

4) "I can't get rid of my debt. I have an Installment Agreement and I've been making payments for 3 or 4 years now and the bill isn't even going down much. I need help!"

This is common. Even though you may have an Installment Agreement, penalties and interest may continue to accrue. This means the monthly payments you make may not really have too much impact on reducing the debt you owe - so - if your debt to the IRS is 3 years old or more, the IRS may be willing to take your bill, tear it up and throw it away. They may give you a new bill that is not based on what you owe, but rather is based on what you can afford to pay. You have to start this ball rolling. The IRS will not suggest anything like this to you. You need to start the Offer in Compromise process. Warning: don't try his one on your own and don't get some fly-by-night to help you. Be smart: go see an attorney at law who is a tax specialist.

5) "Me bad. I am a contractor (or in business for myself) and I haven't been reporting all my income (or some other shady scheme), so now what do I do to stay out of federal prison?"

Believe it or not, the IRS is just simply not interested in making trouble for you. Don't believe the hype and social myths. The IRS wants you to (a) report your income and (b) pay taxes on that income. That's all they want and they are willing to bend over backwards to help you fix things up and come into full compliance. They want you to move on with your life and they want to get your file off their desk. It's just that simple. Don't let blind fear turn you into a procrastinator. You'll just make things worse.

Remember: When you need help, don't fall for the TV scams and con games. Make absolutely certain you talk ONLY to an attorney at law. In California that means someone who is licensed and is a member of the California State Bar, the government organization that tracks and supervises every attorney at law in the State of California.

Every state has a state bar. Find them through the American Bar Association.

If you contact the IRS online, remember the official U.S. Government website for the Internal Revenue Service (a part of the U.S. Treasury Department) is www.irs.gov. Make sure the last three letters are "gov" and not "com" or "org" - you may fall into the hands of scammers and crooks. There are plenty of predators out there waiting for victims who don't pay attention.

So, if you are unsure, go see an attorney at law. Most tax attorneys will grant you a free consultation wherein they will answer your questions, give you the legal advice you need, let you know what your options are (so you can make an informed choice) and develop a game plan for you to get you from the spot you're in to where you want to be.
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on Sunday, December 20, 2009

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