by Fresh Start Tax | Jan 21, 2014 | Tax Help
Affordable Professional Federal and State Tax Representation
If you are just received a tax audit notice from the Internal Revenue Service or state of Florida for a tax audit and need immediate help, tax defense or tax representation, contact us today for a free initial tax consultation and speak directly to a true tax professional.
We have been located right here in South Florida since 1982 are A+ rated by the Better Business Bureau.
We are comprised of tax attorneys, certified public accountants, and former IRS agents who know the law and taught tax law while employed with the Internal Revenue Service.
A tax audit is a procedure where the IRS examines your individual or business financial records to make sure you filed your income or business tax return accurately.
The Internal Revenue Service is just trying to make sure that you filed a correct and accurate tax return. Many times the IRS will close out the tax audit with the no change.
You have the right to ask why your tax return was selected for an Tax Audit.
The Internal Revenue Service has the right to withhold that information from you but most of the time they are happy you explain why your tax return kicked out for an IRS tax audit.
What causes IRS tax audits
1. Many times specific activity on your return such as cash wages, 1099 and W-2 forms that don’t match your reporting,
2. High deductions relative to your income,
3. Tax reports inconsistent with previous years,
4. Related examinations, where your report involved transactions with someone else who is being audited,
5. Automatic flags,where computer programs find outlying “scores” on returns,
6. Random selection,
7. Foreign Bank Accounts.
IRS Tax Audit Facts:
- The Internal Revenue Service audits 1% of all tax returns,
- The Internal Revenue Service collects over $10.2 billion a year as a result of tax audits,
- IRS collects $5.27 billion as a result of the document matching program,
- IRS collects $1.1 billion on corresponding tax audits,
- IRS conducts over 359,000, field and office audits every year.
Call us today for a free initial tax consultation to speak directly to former IRS agents, managers and tax instructors.
We are A+ rated by the Better Business Bureau have been in private practice since 1982.
Tax Audit IRS, State – Help, Defense, Representation – Palm City, North River Shores, Port Salerno – Martin County
by Fresh Start Tax | Jan 21, 2014 | Tax Help
Got IRS Collection Problems, call us today. 1-866-700-1040
Yes, if the conditions are right the IRS may forgo the collections of a Trust Fund recovery penalty.
If the IRS is considering a trust fund penalty against the taxpayer, IRS should be conducting a financial determination to find out whether there is collection potential for the trust fund recovery penalty.
Most IRS agents are too lazy to do so and just set up the trust fund recovery penalty.
If you are in a position that you cannot pay the tax because of your current financial condition bring this to the attention of the revenue officer and the manager working the case and give them your current financial status.
Here is the IRS code section that applies to this situation.
Per IRS IRM 5.7.5
A collectibility determination must be made in order to determine if the trust fund recovery penalty (TFRP) should be assessed.
The TFRP will normally not be assessed when:
1.There is no present or future collection potential
2. Neither the responsible person nor their assets/income sources can be located
IRS – IRS 5.7.5.2
Collectibility for Trust Fund Recovery Penalties
IRS should secure Form 433–A, Collection Information Statement (CIS) for Wage Earners and Self-Employed Individuals, in order to determine collectibility.
IRS will use Form 433-F, Collection Information Statement, may be used instead of Form 433-A if the individual is a wage earner and the potential TFRP liability is less than $100,000.
IRS Exception:
Although a financial statement is not required if one was obtained within the past twelve months, current research of the taxpayer’s information is still required.
If the taxpayer will not complete the CIS, determine if a summons can be issued (if there are other open existing assessments.
The taxpayer should give the IRS the collection financial statement to prove they are non-collectable.
As part of the collectibility investigation, current compliance on all 1040’s.
Verification of Ability to Pay
The following factors will be considered when determining collectibility of the TFRP:
1. Current financial condition
2. Involvement in a bankruptcy proceeding
3. Income history and future income potential
4. Asset potential (likelihood of increase in equity in assets and taxpayer’s potential to acquire assets in the future)
IRS will also research the taxpayer’s information by using the following internal and external sources, as well as any other applicable sources, to verify and determine collectibility:
1.Income, Employment Records
2.Income and assets, e.g., income tax interest deduction for real property, IRA contributions, etc.
3.Motor Vehicles
4. Real Estate
5. Property Records
As a general rule the IRS does not request a full credit bureau check on the potentially responsible party if there is no assessment against the individual.
IRS Trust Fund Recovery Penalty – IRS Can Chose Not to Collect Tax
by Fresh Start Tax | Jan 21, 2014 | Tax Help
We are comprised of tax attorneys, tax lawyers, certified public accountants, and former IRS agents, managers and tax instructors.
We have over 206 years professional tax experience and over 60 years of direct work experience in the local, district, and regional tax offices of the Internal Revenue Service.
We have an A+ rating by the Better Business Bureau.
The New IRS tax relief initiative is called the Fresh Start Initiative.
The Internal Revenue Service is offering tax relief for taxpayers who owe back taxes. As a general rule, the Internal Revenue Service has never offered any programming available to help taxpayers suffering from back tax debt.
Finally , the Internal Revenue Service is starting to offer tax relief for those taxpayers who qualify for the new program.
You should call us today and see if there is a program that matches your particular situation.
Remember, each case is different and as a general rule there something in this program for everybody.
Expansion of the Fresh Start Initiative.
The Internal Revenue Service has expanded its “Fresh Start” initiative to help struggling taxpayers who owe back taxes.
The following 3 tips explain the expanded relief for taxpayers.
There are different areas providing tax relief.
1. IRS Penalty Relief Part of the initiative relieves some unemployed taxpayers from failure-to-pay penalties.
IRS Penalties are one of the biggest factors a financially distressed taxpayer faces on a tax bill.
The Fresh Start Penalty Relief Initiative gives eligible taxpayers a six-month extension to fully pay 2011 taxes.
IRS Interest still applies on the 2011 taxes from April 17, 2012 until the tax is paid, but you won’t face failure-to-pay penalties if you pay your tax, interest and any other penalties in full by Oct. 15, 2012.
The penalty relief is available to two categories of taxpayers:
1. Wage earners who have been unemployed at least 30 consecutive days
during 2011 or in 2012 up to this year’s April 17 tax deadline.
2. Self-employed individuals who experienced a 25 percent or greater
reduction in business income in 2011 due to the economy.
To qualify for this penalty relief, your adjusted gross income must not exceed $200,000 if married filing jointly or $100,000 if your filing status is single, married filing separately, head of household, or qualifying widower.
Your 2011 balance due can not exceed $50,000.
2. IRS Installment agreements or payment agreements.
An installment or payment agreement is a payment option for those who cannot pay their entire tax bill by the due date.
The Fresh Start provisions give more taxpayers the ability to use streamlined installment agreements to catch up on back taxes and also more time to pay.
The new threshold for requesting an installment agreement has been raised from $25,000 to $50,000. This option requires limited financial information, meaning far less burden to the taxpayer.
The maximum term for streamlined installment agreements has been raised to six years from the current five-year maximum.
If your debt is more than $50,000, you’ll still need to supply the IRS with a Collection Information Statement.
You also can pay your balance down to $50,000 or less to qualify for this payment option.This is highly recommended if possible. If you avoid giving the IRS a financial statement it is in your best interest.
With an IRS installment agreement, you’ll pay less in penalties, but interest continues to accrue on the outstanding balance.
In order to qualify for the new expanded streamlined installment agreement, you must agree to monthly direct debit payments.
3. Offer in Compromise or IRS Tax Settlements
Under the first round of Fresh Start in 2011, the IRS expanded the Offer in Compromise program to cover a larger group of struggling taxpayers.
An Offer in Compromise is an agreement between a taxpayer and the IRS that settles the taxpayer’s tax liabilities for less than the full amount owed.
The IRS recognizes many taxpayers are still struggling to pay their bills so the agency has been working on more common-sense changes to the OIC program to more closely reflect real-world situations.
An offer in compromise will not be accepted if the IRS believes that the liability can be paid in full as a lump sum or through a payment agreement.
The IRS looks at the taxpayer’s income and assets to make a determination regarding the taxpayer’s ability to pay.
Call us today for a no cost professional tax consultation.
Blessings
Fresh Start Initiative with Fresh Start Tax 1-866-700-1040 – IRS Problems Resolved
by Fresh Start Tax | Jan 20, 2014 | Tax Help
We are a local AFFORDABLE professional tax firm that specializes in IRS tax audit defense, help and representation.
We are comprised of tax attorneys, tax lawyers, certified public accountants, former IRS agents.
We have over 60 years of direct work experience in the local, district, and regional tax offices of the Internal Revenue Service. While the Internal Revenue Service we taught tax law.
Why you may have been selected for a Tax Audit
Taxpayers have always wondered how and why they were selected for an IRS Tax Audit.
The IRS audits over 1.4 million tax returns annually and taxpayers are fearful of being audited.
The answer may seem overly simple, but most people do not have knowledge of the IRS Tax Audit Process.
Each and every tax return is issued a DIF Score (Discriminatory Index Function).
A DIF Score “is a mathematical technique used to score income tax returns for examination potential.”
This technique establishes the National Average Guidelines.
If a DIF score is above the national average, then the risk of an audit escalates. The highest scoring tax returns are then forwarded to an IRS Examiner for further review.
So what triggers a high DIF Score?
Falling out of the National Average Guidelines in the selected areas of expense or deductions.
Examples – Charitable Contributions, Casualty Losses, Home Office, and Travel & Entertainment will affect the tax return’s DIF Score.
Other audit triggers are unfiled tax returns and failure to file the FBAR (Foreign Bank and Financial Account)
How DIF Actually Works
To arrive at the DIF score for each tax return, the IRS computer identifies returns by assigning weights and certain basic tax return characteristics.
These weights are added together to obtain a systemic composite score for all tax returns. That score is used to rank all returns into numerical sequence.
The highest scores are then manually reviewed by IRS Agents at the Service Centers to determine the merit and worthiness of a Tax Audit.
Since each return is manually reviewed, if you have an unusually high deduction, attach a copy of the bill, receipt and an explanation to the return.
Those extra steps will probably prevent that tax return from the dreaded IRS Tax Audit.
The number of audits performed annually is also determined by the IRS Annual Budget and Agent availability, region by region..
If are an in need of assistance for an upcoming IRS audit, please contact the Tax Resolution Professionals at Fresh Start Tax LLC.
IRS Tax Audit Defense Help, Representation – Lawyers, Former IRS – North Palm Beach, Ocean Ridge, Manalapan
by Fresh Start Tax | Jan 20, 2014 | Tax Help
We are a local South Florida tax firm specializing in IRS representation.
On staff are tax attorneys, certified public accountants, and former IRS agents, managers and tax instructors.
We have over 206 years a professional tax experience and over 60 years of working directly for the Internal Revenue Service and the local South Florida IRS offices.
We can help stop an IRS tax lien and IRS tax levies.
If you disagree with a lien, levy, seizure, or denial or termination of an installment agreement,.
IRS Publication 1660, Collection Appeal Rights, for information on filing your protest.
How to file a Formal Written Appeal/Protest
Include the following in the Appeal:
1. Your name, address, and a daytime telephone number.
2. A statement that you want to appeal the IRS findings to the Office of Appeals.
3. A copy of the letter you received that shows the proposed change(s).
4. The tax period(s) or year(s) involved.
5. A list of each proposed item with which you disagree.
6. The reason(s) you disagree with each item.
7. The facts that support your position on each item.
8. The law or authority, if any, that supports your position on each item.
The penalties of perjury statement as follows:
“Under the penalties of perjury, I declare that the facts stated in this protest and any accompanying documents are true, correct, and complete to the best of my knowledge and belief.”
Your signature required under the penalties of perjury statement.
If you have a tax representative this is required on the Appeal:
If your representative prepares and signs the protest for you, he or she must substitute a declaration for the penalties of perjury statement that includes:
That he or she submitted the protest and any accompanying documents, and
Whether he or she knows personally that the facts stated in the protest and any accompanying documents are true and correct.
You must send your formal written protest within the time limit specified in the letter that offers you the right to appeal the proposed changes.
Generally, the time limit is 30 days from the date of the letter.
How to file a Small Case Request
You may submit a Small Case Request if the entire amount of additional tax and penalty proposed for each tax period is $25,000 or less.
Appeals and Protest – Offer in Compromise Appeals
For an offer in compromise, the entire amount for each tax period includes total unpaid tax, penalty and interest due.
Note: Employee plan, exempt organizations, S corporations and partnerships are not eligible for Small Case Requests.
Follow the instructions in the letter you received.
Use Form 12203, Request for Appeals Review, or the form referenced in the letter to file your appeal, or prepare a brief written statement.
List the disagreed item(s) and the reason(s) you disagree.
IRS Tax Lien, IRS Tax Levy – STOP IRS with FILING Appeal – Miami, Ft.Lauderdale, Palm Beaches
