by Fresh Start Tax | Mar 21, 2017 | Tax Help
We are AFFORDABLE tax firm that can help resolve any IRS tax problem including tax preparer penalties. Since 1982. A plus Rated BBB, use Former Agents who know the system!
You can have back tax assistance by former IRS agents that were teaching instructors with the Internal Revenue Service.
As former IRS agents supervisors and teaching instructors we had great value to any tax preparer trying to sort out any problem.
We have over 65 years of direct IRS work experience in the local, district, and regional tax offices of the Internal Revenue Service.
We are one of the most experienced tax firms in the industry and are available for free initial tax consultation.
Summary of Preparer Penalties under Title 26
IRC § 6694 – Understatement of taxpayer’s liability by tax return preparer.
IRC § 6694(a) – Understatement due to unreasonable positions. The penalty is the greater of $1,000 or 50% of the income derived by the tax return preparer with respect to the return or claim for refund.
IRC § 6694(b) – Understatement due to willful or reckless conduct. The penalty is the greater of $5,000 or 50% of the income derived by the tax return preparer with respect to the return or claim for refund.
IRC § 6695 – Other assessable penalties with respect to the preparation of tax returns for other persons.
IRC § 6695(a) – Failure to furnish copy to taxpayer. The penalty is $50 for each failure to comply with IRC § 6107 regarding furnishing a copy of a return or claim to a taxpayer. The maximum penalty imposed on any tax return preparer shall not exceed $25,000 in a calendar year.
IRC § 6695(b) – Failure to sign return. The penalty is $50 for each failure to sign a return or claim for refund as required by regulations. The maximum penalty imposed on any tax return preparer shall not exceed $25,000 in a calendar year.
IRC § 6695(c) – Failure to furnish identifying number. The penalty is $50 for each failure to comply with IRC § 6109(a)(4) regarding furnishing an identifying number on a return or claim. The maximum penalty imposed on any tax return preparer shall not exceed $25,000 in a calendar year.
IRC § 6695(d) – Failure to retain copy or list. The penalty is $50 for each failure to comply with IRC § 6107(b) regarding retaining a copy or list of a return or claim. The maximum penalty imposed on any tax return preparer shall not exceed $25,000 in a return period.
IRC § 6695(e) – Failure to file correct information returns. The penalty is $50 for each failure to comply with IRC § 6060. The maximum penalty imposed on any tax return preparer shall not exceed $25,000 in a return period.
IRC § 6695(f) – Negotiation of check. The penalty is $500 for a tax return preparer who endorses or negotiates any check made in respect of taxes imposed by Title 26 which is issued to a taxpayer.
IRC § 6695(g) – Failure to be diligent in determining eligibility for earned income credit. The penalty is $500 for each failure to comply with the EIC due diligence requirements imposed in regulations.
IRC § 6700 – Promoting abusive tax shelters
The penalty is for a promoter of an abusive tax shelter and is generally equal to $1,000 for each organization or sale of an abusive plan or arrangement (or, if lesser, 100 percent of the income derived from the activity).
IRC § 6701 – Penalties for aiding and abetting understatement of tax liability.
The penalty is $1000 ($10,000 if the conduct relates to a corporation’s tax return) for aiding and abetting in an understatement of a tax liability. Any person subject to the penalty shall be penalized only once for documents relating to the same taxpayer for a single tax period or event.
IRC § 6713 – Disclosure or use of information by preparers of returns.
The penalty is $250 for each unauthorized disclosure or use of information furnished for, or in connection with, the preparation of a return. The maximum penalty on any person shall not exceed $10,000 in a calendar year.
IRC § 7206 – Fraud and false statements.
Guilty of a felony and, upon conviction, a fine of not more than $100,000 ($500,000 in the case of a corporation), imprisonment of not more than three years, or both (together with the costs of prosecution).
IRC § 7207 – Fraudulent returns, statements, or other documents.
Guilty of a misdemeanor and, upon conviction, a fine of not more than $10,000 ($50,000 in the case of a corporation), imprisonment of not more than one year, or both.
IRC § 7216 – Disclosure or use of information by preparers of returns.
Guilty of a misdemeanor for knowingly or recklessly disclosing information furnished in connection with a tax return or using such information for any purpose other than preparing or assisting in the preparation of such return. Upon conviction, a fine of not more than $1,000, imprisonment for not more than 1 year, or both (together with the costs of prosecution).
IRC § 7407 – Action to enjoin tax return preparers.
A federal district court may enjoin a tax return preparer from engaging in certain proscribed conduct, or in extreme cases, from continuing to act as a tax return preparer altogether.
IRC § 7408 – Action to enjoin specified conduct related to tax shelters and reportable transactions
A federal district court may enjoin a person from engaging in certain proscribed conduct (including any action, or failure to take action, which is in violation of Circular 230)
Call us today for a free initial tax consultation and speak directly to a former IRS agent, former manager or teaching instructor about the various options available to you.
We can help you with any taxpayer defense and representation.
Free professional evaluation. 1-866-700-1040
by Fresh Start Tax | Mar 21, 2017 | Tax Help
We are affordable tax firm that can resolve any IRS tax problem including tax preparer penalties and issues. Since 1982. A plus Rated BBB
We are true experts on giving you every possible option to resolve you tax preparer issue.
You can have back tax assistance by former IRS agents that were teaching instructors with the Internal Revenue Service.
As former IRS agents supervisors and teaching instructors we had great value to any tax preparer trying to sort out any problem.
We have over 65 years of direct IRS work experience in the local, district, and regional tax offices of the Internal Revenue Service.
We are one of the most experienced tax firms in the industry and are available for free initial tax consultation.
Summary of Preparer Penalties under Title 26
IRC § 6694 – Understatement of taxpayer’s liability by tax return preparer.
IRC § 6694(a) – Understatement due to unreasonable positions. The penalty is the greater of $1,000 or 50% of the income derived by the tax return preparer with respect to the return or claim for refund.
IRC § 6694(b) – Understatement due to willful or reckless conduct. The penalty is the greater of $5,000 or 50% of the income derived by the tax return preparer with respect to the return or claim for refund.
IRC § 6695 – Other assessable penalties with respect to the preparation of tax returns for other persons.
IRC § 6695(a) – Failure to furnish copy to taxpayer. The penalty is $50 for each failure to comply with IRC § 6107 regarding furnishing a copy of a return or claim to a taxpayer. The maximum penalty imposed on any tax return preparer shall not exceed $25,000 in a calendar year.
IRC § 6695(b) – Failure to sign return. The penalty is $50 for each failure to sign a return or claim for refund as required by regulations. The maximum penalty imposed on any tax return preparer shall not exceed $25,000 in a calendar year.
IRC § 6695(c) – Failure to furnish identifying number. The penalty is $50 for each failure to comply with IRC § 6109(a)(4) regarding furnishing an identifying number on a return or claim. The maximum penalty imposed on any tax return preparer shall not exceed $25,000 in a calendar year.
IRC § 6695(d) – Failure to retain copy or list. The penalty is $50 for each failure to comply with IRC § 6107(b) regarding retaining a copy or list of a return or claim. The maximum penalty imposed on any tax return preparer shall not exceed $25,000 in a return period.
IRC § 6695(e) – Failure to file correct information returns. The penalty is $50 for each failure to comply with IRC § 6060. The maximum penalty imposed on any tax return preparer shall not exceed $25,000 in a return period.
IRC § 6695(f) – Negotiation of check. The penalty is $500 for a tax return preparer who endorses or negotiates any check made in respect of taxes imposed by Title 26 which is issued to a taxpayer.
IRC § 6695(g) – Failure to be diligent in determining eligibility for earned income credit. The penalty is $500 for each failure to comply with the EIC due diligence requirements imposed in regulations.
IRC § 6700 – Promoting abusive tax shelters
The penalty is for a promoter of an abusive tax shelter and is generally equal to $1,000 for each organization or sale of an abusive plan or arrangement (or, if lesser, 100 percent of the income derived from the activity).
IRC § 6701 – Penalties for aiding and abetting understatement of tax liability.
The penalty is $1000 ($10,000 if the conduct relates to a corporation’s tax return) for aiding and abetting in an understatement of a tax liability. Any person subject to the penalty shall be penalized only once for documents relating to the same taxpayer for a single tax period or event.
IRC § 6713 – Disclosure or use of information by preparers of returns.
The penalty is $250 for each unauthorized disclosure or use of information furnished for, or in connection with, the preparation of a return. The maximum penalty on any person shall not exceed $10,000 in a calendar year.
IRC § 7206 – Fraud and false statements.
Guilty of a felony and, upon conviction, a fine of not more than $100,000 ($500,000 in the case of a corporation), imprisonment of not more than three years, or both (together with the costs of prosecution).
IRC § 7207 – Fraudulent returns, statements, or other documents.
Guilty of a misdemeanor and, upon conviction, a fine of not more than $10,000 ($50,000 in the case of a corporation), imprisonment of not more than one year, or both.
IRC § 7216 – Disclosure or use of information by preparers of returns.
Guilty of a misdemeanor for knowingly or recklessly disclosing information furnished in connection with a tax return or using such information for any purpose other than preparing or assisting in the preparation of such return. Upon conviction, a fine of not more than $1,000, imprisonment for not more than 1 year, or both (together with the costs of prosecution).
IRC § 7407 – Action to enjoin tax return preparers.
A federal district court may enjoin a tax return preparer from engaging in certain proscribed conduct, or in extreme cases, from continuing to act as a tax return preparer altogether.
IRC § 7408 – Action to enjoin specified conduct related to tax shelters and reportable transactions
A federal district court may enjoin a person from engaging in certain proscribed conduct (including any action, or failure to take action, which is in violation of Circular 230)
Call us today for a free initial tax consultation and speak directly to a former IRS agent, former manager or teaching instructor about the various options available to you. We can help you with any taxpayer defense and representation.
Free professional evaluation. 1-866-700-1040
by Fresh Start Tax | Mar 21, 2017 | Tax Help
We are affordable tax firm that can resolve any IRS tax problem including tax preparer penalties and issues. Since 1982. A plus Rated BBB.
We are true experts on giving you every possible option to resolve you tax preparer issue.
You can have back tax assistance by former IRS agents that were teaching instructors with the Internal Revenue Service.
As former IRS agents supervisors and teaching instructors we had great value to any taxpayer trying to sort out the different options.
We have over 65 years of direct IRS work experience in the local, district, and regional tax offices of the Internal Revenue Service.
We are one of the most experienced tax firms in the industry and are available for free initial tax consultation.
Summary of Preparer Penalties under Title 26
IRC § 6694 – Understatement of taxpayer’s liability by tax return preparer.
IRC § 6694(a) – Understatement due to unreasonable positions. The penalty is the greater of $1,000 or 50% of the income derived by the tax return preparer with respect to the return or claim for refund.
IRC § 6694(b) – Understatement due to willful or reckless conduct. The penalty is the greater of $5,000 or 50% of the income derived by the tax return preparer with respect to the return or claim for refund.
IRC § 6695 – Other assessable penalties with respect to the preparation of tax returns for other persons.
IRC § 6695(a) – Failure to furnish copy to taxpayer. The penalty is $50 for each failure to comply with IRC § 6107 regarding furnishing a copy of a return or claim to a taxpayer. The maximum penalty imposed on any tax return preparer shall not exceed $25,000 in a calendar year.
IRC § 6695(b) – Failure to sign return. The penalty is $50 for each failure to sign a return or claim for refund as required by regulations. The maximum penalty imposed on any tax return preparer shall not exceed $25,000 in a calendar year.
IRC § 6695(c) – Failure to furnish identifying number. The penalty is $50 for each failure to comply with IRC § 6109(a)(4) regarding furnishing an identifying number on a return or claim. The maximum penalty imposed on any tax return preparer shall not exceed $25,000 in a calendar year.
IRC § 6695(d) – Failure to retain copy or list. The penalty is $50 for each failure to comply with IRC § 6107(b) regarding retaining a copy or list of a return or claim. The maximum penalty imposed on any tax return preparer shall not exceed $25,000 in a return period.
IRC § 6695(e) – Failure to file correct information returns. The penalty is $50 for each failure to comply with IRC § 6060. The maximum penalty imposed on any tax return preparer shall not exceed $25,000 in a return period.
IRC § 6695(f) – Negotiation of check. The penalty is $500 for a tax return preparer who endorses or negotiates any check made in respect of taxes imposed by Title 26 which is issued to a taxpayer.
IRC § 6695(g) – Failure to be diligent in determining eligibility for earned income credit. The penalty is $500 for each failure to comply with the EIC due diligence requirements imposed in regulations.
IRC § 6700 – Promoting abusive tax shelters
The penalty is for a promoter of an abusive tax shelter and is generally equal to $1,000 for each organization or sale of an abusive plan or arrangement (or, if lesser, 100 percent of the income derived from the activity).
IRC § 6701 – Penalties for aiding and abetting understatement of tax liability.
The penalty is $1000 ($10,000 if the conduct relates to a corporation’s tax return) for aiding and abetting in an understatement of a tax liability. Any person subject to the penalty shall be penalized only once for documents relating to the same taxpayer for a single tax period or event.
IRC § 6713 – Disclosure or use of information by preparers of returns.
The penalty is $250 for each unauthorized disclosure or use of information furnished for, or in connection with, the preparation of a return. The maximum penalty on any person shall not exceed $10,000 in a calendar year.
Internal Revenue Code § 6694(a) provides that if any part of an understatement of a taxpayer’s liability is due to an “unrealistic position” taken on his return, any income tax return preparer who knew (or reasonably should have known) of this position is subject to a penalty of $250.
If the understatement is due to a reckless or intentional disregard of rules or regulations the penalty is $1,000 per occurrence.
The preparer’s employer, firm or entity also is subject to the penalty if it knew, or reasonably should have known, of the conduct giving rise to the penalty.
While these may not seem like large amounts, if this penalty is assessed IRS employees are instructed to report the income tax return preparer to the IRS Office of Professional Responsibility also known as OPR.
A preparer who is referred to the IRS’s Office of Professional Responsibility, may be subject to suspension, disbarment, or censure.
In addition, if the tax preparer has violated Circular No. 230, the IRS may impose a monetary penalty in an amount up to the gross income derived or to be derived from the conduct giving rise to the penalty.
We are experienced tax firm that can help deal with the issues and penalty notices above. Being former IRS agents, managers and teaching instructors gives us a unique insight in dealing with the offer mentioned problems.
Call us today and get a free initial tax consultation. 1-866-700-1040
by Fresh Start Tax | Mar 14, 2017 | Tax Help
Debt Cancellation May be Taxable
If a lender cancels part or all of a debt, a taxpayer must generally consider this as income. However, the law allows an exclusion that may apply to homeowners who had their mortgage debt canceled in 2016.
Here are tips about debt cancellation:
1. Main Home.
If the canceled debt was a loan on a taxpayer’s main home, they may be able to exclude the canceled amount from their income. They must have used the loan to buy, build or substantially improve their main home to qualify. Their main home must also secure the mortgage.
2. Loan Modification.
If a taxpayer’s lender canceled or reduced part of their mortgage balance through a loan modification or ‘workout,’ the taxpayer may be able to exclude that amount from their income. They may also be able to exclude debt discharged as part of the Home Affordable Modification Program, or HAMP. The exclusion may also apply to the amount of debt canceled in a foreclosure.
3. Refinanced Mortgage.
The exclusion may apply to amounts canceled on a refinanced mortgage. This applies only if the taxpayer used proceeds from the refinancing to buy, build or substantially improve their main home and only up to the amount of the old mortgage principal just before refinancing. Amounts used for other purposes do not qualify.
4. Other Canceled Debt.
Other types of canceled debt such as second homes, rental and business property, credit card debt or car loans do not qualify for this special exclusion. On the other hand, there are other rules that may allow those types of canceled debts to be nontaxable.
5. Form 1099-C.
If a lender reduced or canceled at least $600 of a taxpayer’s debt, the taxpayer should receive Form 1099-C, Cancellation of Debt, by Feb. 1. This form shows the amount of canceled debt and other information.
6. Form 982.
If a taxpayer qualifies, report the excluded debt on Form 982, Reduction of Tax Attributes Due to Discharge of Indebtedness. They should file the form with their income tax return.
7. IRS.gov Tool.
Taxpayers should use the Interactive Tax Assistant tool – Do I Have Cancellation of Debt Income on My Personal Residence? – on IRS.gov to find out if their canceled mortgage debt is taxable.
8. Exclusion Extended.
The law that authorized the exclusion of cancelled debt from income was extended through Dec. 31, 2016.
9. IRS Free File. I
RS e-file is fastest, safest and easiest way to file. Taxpayers can use IRS Free File to e-file their tax return for free. If they earned $64,000 or less, they can use brand name tax software. The software does the math and completes the right forms for them.
If they earned more than $64,000, they can use Free File Fillable Forms.
This option uses electronic versions of IRS paper forms. It is best for those who are used to doing their own taxes. Free File is available only on IRS.gov/freefile.
10. More Information.
For more on this topic see Publication 4681, Canceled Debts, Foreclosures, Repossessions and Abandonment’s.
by Fresh Start Tax | Mar 14, 2017 | Tax Help
Immediate Levy Releases and Settlements at the same time! Affordable. Former Agents who know system. Since 1982 954-492-0088
If you are currently dealing with the Internal Revenue Service and need immediate and permanent tax resolution contact us today and we can get your IRS tax levy or wage garnishment levy removed once and for all.
We can not only get your IRS tax Levy or wage garnishment levy removed we can also settle your case with the Internal Revenue Service at the same time.
We have worked hundreds and hundreds of cases right here in South Florida and are one of the most experience in seasons tax firms in Fort Lauderdale and Miami.
We are one of the most affordable choices for South Florida and have been in practice right here since 1982. We are A+ rated by the Better Business Bureau.
You need help dealing with a IRS Tax Levy or Wage Garnishment, contact Former IRS Agents today who know the remedies of relief.
Dealing with a IRS Tax Levy, Wage Garnishment, Tax Liens
Being a former IRS agents we have learned that most taxpayers fear getting an IRS tax Levy, a wage garnishment or have a federal tax lien filed against them.
Many taxpayers simply do not know what to do to avoid this IRS enforcement action.
But steps may be taken to avoid the IRS tax Levy, wage garnishment, and the filing of the federal tax lien.
Quick IRS Tax Facts
The IRS files 2.8 million tax levies and wage garnishments each and every year,
The IRS files 920,000 federal tax liens each and every year,
The IRS settles 38% of all the cases they receive through the offer in compromise process
If federal debts go on pay the Internal Revenue Service will issue levies on bank accounts and on wages. There is a process that must take place before IRS can issue these enforcement procedures.
The IRS Process – Collection Action for Enforcement – IRS Tax Levy, Wage Garnishment Levy
For the IRS to proceed with any enforcement action the IRS is required by law to provide the taxpayer with:
1. Notice and demand for payment,
2. Notice of intent to levy,
3. Notice of a right to a Collection Due Process hearing,
The IRS accomplishes these requirements by sending a series of five letters, starting about six weeks after the taxpayer files a return. IRS works on a cycle system.
One week is one cycle. IRS may skip the cycles on repeated delinquents.
These tax notices are sent from there Cade 2 computer.
The five letters are sent by the to as the automated collection or ASC.
IRS collection notice stream cycle,
1.CP14,
2.CP501,
3.CP503,
4.CP504, and
5. L1058/LT11).
Should the taxpayer receive the last notice and does not pay the balance or make other arrangements to pay the balance, the IRS can levy the taxpayer’s income and assets, including garnishing wages and or self-employment income and seizing funds in bank accounts. These levy’s are on tax form, 668A, 668W.
Please note:
On all bank levies and there is a 21 when day freeze on your money. IRS gives taxpayers 21 days to get the levy lifted.
The IRS wage garnishment’s are immediate seizures and the money will be sent to IRS on your next paycheck.It is very important you contact IRS the day you get the wage garnishment.
How to Immediately Avoid an IRS Levy
If you know the balance is due and owing, it’s best to call the Internal Revenue Service and walk through the process of obtaining a settlement. Call the number on your notice or a tax professional like our firm. We can help you immediately.
When calling the IRS to avoid a tax levy or Wage Garnishment, the IRS will want a current financial.
IRS will want a collection information statement or financial statement. You can find that form on our website. They are usually on form 433-F or a 433A.
After you complete the form you will need to sent or fax to the IRS a copy of completed form along with your income verification (pay stubs) expenses, copy your bank statements, and verification of all monthly and installment expenses.
The IRS will carefully review the statement before reaching a conclusion.
Key Tip:
I recommend that all taxpayers call the IRS and have a fax machine nearby. If IRS has already issued the IRS tax Levy or notice of wage garnishment and they receive a fully completed financial statement along with all documentation they can release the tax levy and wage garnishment that day.
Note – The IRS will compare that financial statement against the national and regional expenses in your area and apply the national standards test to your financial statement. The National Standards are on our site as well.
It is best to contact a professional tax firm to make sure your financial statement is correct and you get the very best deal possible.
After the review of your financial statement the IRS will place you in one of three categories.
They have the option of placing you into a:
1. Current Hardship,
2. Installment Agreements/Payment Agreement,
3. Have you Filing an Offer in Compromise.
One simple, common solution is an extension of time to pay the balance in full.
IRS extensions allow you up to 120 days to pay the balance and avoid a levy.
What about a IRS Tax Settlement called the Offer in Compromise
The IRS offer in compromise (OIC) is a collection alternative that settles a taxpayer’s tax debt for less than the amount owed, and it also suspends levy actions.
It’s important to note that if the IRS determines that you are purposely delaying the collection process, the IRS can use liens and/or levies even while it considers your request for a collection alternative.
It is critical you file all your back tax returns and make sure your courage on your withholding or estimated tax payments.
IRS Tax Lien vs. IRS Tax Levy, these are always mixed up.
A lien is not a levy.
A lien secures the government’s interest in your property when you don’t pay your tax debt. A levy actually takes the property to pay the tax debt.
If you don’t pay or make arrangements to settle your tax debt, the IRS can levy, seize and sell any type of real or personal property that you own or have an interest in.
If you live in the South Florida area contact us today and we can give you the help you need to get your IRS tax levy or wage garnishment levy removed and released.
