by Fresh Start Tax | Aug 13, 2013 | IRS Tax Debt
There are different ways to deal with the Internal Revenue Service to settle a tax debt.
One of the critical aspects in settling with the Internal Revenue Service is to make sure that your case is permanently resolved.
The ways of permanently resolving your debt are either through a bankruptcy proceeding, the statute of limitations expiring or the settling of your case through an offer in compromise.
Hiring a solid tax debt attorney firm can assure that you can resolve your case for the lowest amount of money in the least amount of pain to the client. This article will only deal with the offer in compromise to relieve yourself of the IRS tax debt.
Tax Settlement
Experienced tax attorneys and tax firms can help assure that you will settle your tax debt with the Internal Revenue Service for the lowest dollar allowed by law. It also should be known that there are specific formulas that dictate the IRS tax settlement policy.
The Internal Revenue Service has a process which is called the offer in compromise.
Tax Debt Attorney Facts
- The Internal Revenue Service receives about 60,000 offers in compromise each year.
- About 38% of those offers are accepted by the Internal Revenue Service. The average settlement on a dollar is $.14.
- If you are going to file for tax debt relief with the Internal Revenue Service you need to be patient. The average wait time to settle your case with the IRS is between six months to a year.
The Offer in Compromise
Within the last two years the Internal Revenue Service has come out with a new program or initiative called the fresh start .
It has allowed taxpayers struggling with old tax debt to permanently deal with the Internal Revenue Service and completely eliminate their tax debt for pennies on the dollar.
Before taxpayers goes running off to settle their IRS debt the taxpayer must make sure that they are a suitable and qualified candidate for the offer in compromise program.
Warning
As a warning to taxpayers, searching the Internet for tax companies to do this work I would caution you to make sure you are giving your work to a professional tax company. Most Internet sites that you see do not use qualified tax professionals to deal with your IRS tax debt.
They use semi-qualified people were more interested in generating fees in settling your tax debt.
Before hiring a tax that firm check on the qualifications of the professional that we will be working your particular case. Ask that person many questions. You will get a good solid gut feeling on whether you should hire that person or that firm. You should also check on the BBB rating as well as asking for similar results on a case that is similar to yours.
Pre-Qualifier Tool for Tax Debt
To make sure that you do not fall victim for some of these companies, the Internal Revenue Service has now a pre-qualifier tool that you can use before you submit your offer in compromise to settle your tax debt with the IRS.
You will find that pre-qualifier tool right on our website. I would urge all taxpayers before paying a dime to any tax firm to walk themselves through this very simple process to make sure they are qualified for an IRS tax debt settlement called the offer in compromise.
What dollar amount is IRS looking for to settle
The Internal Revenue Service is interested in two main things things, your assets in your income.
IRS has specific formulas to deal with the taxpayer’s income and the liquidation of certain assets to come up with a fair settlement amount for the offer in compromise to settle a tax that.
We at fresh start tax llc will pre-qualify your offer in compromise and make sure that you are a quality candidate for the tax debt settlement call the offer of compromise.
Contact us today for free initial tax consultation and we walk you through this program.
An offer in compromise allows you to settle your tax debt for less than the full amount you owe. It may be a legitimate option if you can’t pay your full tax liability, or doing so creates a financial hardship.
IRS mainly consider your unique set of facts and circumstances:
1. Ability to pay;
2. Income;
3. Expenses; and
4. Asset equity.
The IRS generally approve an offer in compromise when the amount offered represents the most they can expect to collect within a reasonable period of time.
Make sure you explore all other payment options before submitting an offer in compromise.
The Offer in Compromise program is not for everyone. If you hire a tax professional to help you file an offer, be sure to check his or her qualifications.
Make sure you are eligible for a Tax Debt Reduction
Before the IRS can consider your offer, you must be current with all filing and payment requirements. You are not eligible if you are in an open bankruptcy proceeding. Use the Offer in Compromise Pre-Qualifier on the fresh start tax llc to confirm your eligibility and prepare a preliminary proposal.
Submitting your offer to the IRS
Your completed offer package will include:
1. Form 433-A (OIC) (individuals) or
2. 433-B (OIC) (businesses) and all required documentation as specified on the forms;
Form 656(s) – individual and business tax debt (Corporation/ LLC/ Partnership) must be submitted on separate
3. Form 656;
4. $150 application fee (non-refundable); and
Initial payment (non-refundable) for each Form 656.
Select a payment option for the Tax Debt for the OIC
Your initial payment will vary based on your offer and the payment option you choose:
- Lump Sum Cash: Submit an initial payment of 20 percent of the total offer amount with your application. Wait for written acceptance, then pay the remaining balance of the offer in five or fewer payments.
- Periodic Payment: Submit your initial payment with your application. Continue to pay the remaining balance in monthly installments while the IRS considers your offer. If accepted, continue to pay monthly until it is paid in full .
Understanding the Tax Debt process with the IRS
While your offer is being evaluated:
1. Your non-refundable payments and fees will be applied to the tax liability (you may designate payments to a specific tax year and tax debt);
2. A Notice of Federal Tax Lien may be filed;
3. Other collection activities may be suspended;
4. The legal assessment and collection period is extended from the normal 10 years;
5. Make all required payments associated with your offer;
6. You are not required to make payments on an existing installment agreement or payment agreement program; and
7. Your offer is automatically accepted if the IRS does not make a determination within two years of the IRS receipt date. Just so you know this rarely happens.
Fresh Start Tax a professional tax firm that specializes in the resolution of IRS tax debt.
We are comprised of tax debt attorneys, CPAs, and former IRS agents and managers. Contact us today for free initial consultation and we will give you free tax advice whether it is worthwhile to file an offer in compromise for your tax debt to settle with the IRS.
Tax Debt Attorneys – How to Settle with the IRS
by Fresh Start Tax | Aug 12, 2013 | Tax Help
IRS Final Notice Tax Help –Tax Help How to STOP the IRS
We are a local South Florida professional tax firm that specializes in IRS representation. We have practiced in South Florida since 1982 and are A+ rated by the Better Business Bureau.
Please feel free to call us today for an initial tax consultation
Do not be bullied by the IRS. As former IRS agents there are many remedies available and it is always best to seek professional tax help.
Please note there are several ways to stop the IRS final notice however the most common way is simply by filing a timely collection due process.
Please read below about the process.
Received a IRS Notice or Bill ? Final Notice ?
If you have received an IRS final notice there are tax remedies put in place by the Internal Revenue Service to stop any enforcement action that may be taking place in the very near future.
Taxpayers can file this procedure by themselves or in fairness to hire a professional tax firm to walk them through the process.
To stop the IRS immediately taxpayers can file a collection due process that few taxpayers know about.
It is critical when they file a collection due process to do so within the time frames prescribed within the procedures. If not taxpayers will lose there right to a hearing and there is no other process left.
The Collection Due Process: IRS Final Notice, Stop the IRS with a CDP
The CDP procedures are available to you if you’ve received any one of the following notices:
- Notice of Federal Tax Lien
You can get the tax help you need through this one simple procedure.
The CDP Procedure by the IRS to Stop the IRS with a Final Notice
You have 30 days to request a hearing to preserve your right to go to Court.
You must Complete Form 12153, Request for a Collection Due Process or Equivalent Hearing.
It is important you identify all your reasons for your disagreements. If you need tax help filling out the form you can contact us and we will give you a free initial tax consultation so you can send in the form.
Where to file the CDP to STOP the IRS ?
The completed Form 12153 should be sent to the same address that is shown on your Federal Tax Lien or IRS Levy Notice.
If your request is not received within 30 days, you are still entitled to an Appeals hearing.
However, if you still disagree with the Appeals determination you cannot go to Court.
Common Questions and Answers to the IRS Final Notice
Q. I just got a Notice Number CP504. It says – “Urgent!! We intend to levy Certain Assets.” I don’t agree that I owe this amount. Question – How can I appeal? Will that stop the levy action?
- A. The IRS cannot levy with just this notice.
They must first issue a formal Notice of Intent to Levy,( this is the IRS Final notice ) and that is the next step after this notice.
Your case is closed as far as any determination about how much you owe, so there is nothing for you to appeal at this point.
However, you do have three options to get your case re-opened so the IRS can consider whether you owe any additional amounts:
1. Pay the amount due in full and file a claim for refund. If the IRS disallows your claim you will have the right to appeal at that time.
2. Follow the instructions in Publication 3598 and request an Audit Reconsideration. Note that you must submit new information the IRS did not previously consider in order to have an audit reconsideration.
3. Follow the instructions in Form 656 and file an Offer in Compromise, Doubt as to liability.
Q. The IRS Collection function says they are going to file a lien or levy my assets. What can I do?
- A. Be sure to contact the Collection function to discuss your situation and your payment options. Refer to Publication 1660, Collection Appeal Rights to review your appeal rights. Some Collection actions qualify for appeal under the Collection Appeals Program (CAP) and some qualify under the Collection Due Process (CDP) appeal.
These two programs offer different advantages depending on the facts of your case. Publication 1660 will help you decide which is best for you.
- Q. I just received a Notice of Federal Tax Lien Filing and Your Right to a Hearing Under IRC 6320, Letter 3172. I don’t believe I owe this amount. What can I do?
A. Refer to Publication 1660. The Letter 3172 gives you 30 days to request a Collection Due Process (CDP) hearing to discuss the lien filing. You should request a CDP hearing if you feel the lien is inappropriate.
However, as explained in Publication 1660, in a CDP hearing Appeals can only discuss the existence of or amount that you owe under very limited circumstances.
If IRS Appeals cannot consider the underlying liability, you have three options to re-open that issue:
1. Pay the amount due in full and file a claim for refund. If the IRS disallows your claim you will have the right to Appeal at that time.
2. Follow the instructions in Publication 3598 and request an Audit Reconsideration. Note that you must submit new information the IRS did not previously consider in order to have an audit reconsideration.
3. Follow the instruction in Form 656 and file an Offer in Compromise, Doubt as to Liability.
- Q. I just received a Letter L-1058 or LT11 FINAL NOTICE OF INTENT TO LEVY AND NOTICE OF YOUR RIGHT TO A HEARING. I don’t believe I owe this amount. What can I do?
A. Refer to Publication 1660. The Letter 3172 gives you 30 days to request a Collection Due Process (CDP) hearing. You should request a CDP hearing if you feel the levy is inappropriate.
However, as explained in Publication 1660, in a CDP hearing Appeals can only discuss the existence of or amount that you owe under very limited circumstances.
If Appeals cannot consider the underlying liability, you have three options to re-open that issue:
1. Pay the amount due in full and file a claim for refund. If the IRS disallows your claim you will have the right to Appeals at that time.
2. Follow the instructions in Publication 3598 and request an Audit Reconsideration. Note that you must submit new information the IRS did not previously consider in order to have an audit reconsideration.
3. Follow the instructions in Form 656 and file an Offer in Compromise, Doubt as to Liability.
If you have any questions regarding an IRS final notice and need professional tax help call us today we can explain to you the different ways on how to stop the IRS.
IRS Final Notice – Tax Help – How to STOP the IRS
by Fresh Start Tax | Aug 12, 2013 | Tax Help
IRS Final Notice Tax Help – How to STOP the IRS
If you have received an IRS final notice there are tax remedies put in place by the Internal Revenue Service to stop any enforcement action that may be taking place in the very near future.
Taxpayers can file this procedure by themselves or in fairness to hire a professional tax firm to walk them through the process.
To stop the IRS immediately taxpayers can file a collection due process.
It is critical when they file a collection due process to do so within the time frames prescribed within the procedures.
If not taxpayers will lose there right to a hearing. That’s it game over for the CDP.
The Collection Due Process: IRS Final Notice, stop the IRS with a CDP
The CDP procedures are available to you if you’ve received any one of the following notices:
- Notice of Federal Tax Lien
The CDP Procedure by the IRS to Stop the IRS with a final Notice
You have 30 days to request a hearing to preserve your right to go to Court.
You must Complete Form 12153, Request for a Collection Due Process or Equivalent Hearing.
It is important you identify all your reasons for your disagreements.
Where to file the CDP to STOP the IRS ?
The completed Form 12153 should be sent to the same address that is shown on your Federal Tax Lien or IRS Levy Notice.
If your request is not received within 30 days, you are still entitled to an Appeals hearing.
However, if you still disagree with the Appeals determination you cannot go to Court.
Common Questions and Answers
- Q. I just got a Notice Number CP504. It says – “Urgent!! We intend to levy Certain Assets.” I don’t agree that I owe this amount.
- Question – How can I appeal? Will that stop the levy action?
A. The IRS cannot levy with just this notice.
They must first issue a formal Notice of Intent to Levy,( this is the IRS Final notice ) and that is the next step after this notice.
Your case is closed as far as any determination about how much you owe, so there is nothing for you to appeal at this point.
However, you do have three options to get your case re-opened so the IRS can consider whether you owe any additional amounts:
1. Pay the amount due in full and file a claim for refund. If the IRS disallows your claim you will have the right to appeal at that time.
2. Follow the instructions in Publication 3598 and request an Audit Reconsideration. Note that you must submit new information the IRS did not previously consider in order to have an audit reconsideration.
3. Follow the instructions in Form 656 and file an Offer in Compromise, Doubt as to liability.
- Q. The IRS Collection function says they are going to file a lien or levy my assets. What can I do?
A. Be sure to contact the Collection function to discuss your situation and your payment options. Refer to Publication 1660, Collection Appeal Rights to review your appeal rights. Some Collection actions qualify for appeal under the Collection Appeals Program (CAP) and some qualify under the Collection Due Process (CDP) appeal.
These two programs offer different advantages depending on the facts of your case. Publication 1660 will help you decide which is best for you.
- Q. I just received a Notice of Federal Tax Lien Filing and Your Right to a Hearing Under IRC 6320, Letter 3172. I don’t believe I owe this amount. What can I do?
A. Refer to Publication 1660. The Letter 3172 gives you 30 days to request a Collection Due Process (CDP) hearing to discuss the lien filing. You should request a CDP hearing if you feel the lien is inappropriate.
However, as explained in Publication 1660, in a CDP hearing Appeals can only discuss the existence of or amount that you owe under very limited circumstances.
If IRS Appeals cannot consider the underlying liability, you have three options to re-open that issue:
1. Pay the amount due in full and file a claim for refund. If the IRS disallows your claim you will have the right to Appeal at that time.
2. Follow the instructions in Publication 3598 and request an Audit Reconsideration. Note that you must submit new information the IRS did not previously consider in order to have an audit reconsideration.
3. Follow the instruction in Form 656 and file an Offer in Compromise, Doubt as to Liability.
- Q. I just received a Letter L-1058 or LT11 FINAL NOTICE OF INTENT TO LEVY AND NOTICE OF YOUR RIGHT TO A HEARING. I don’t believe I owe this amount. What can I do?
A. Refer to Publication 1660. The Letter 3172 gives you 30 days to request a Collection Due Process (CDP) hearing. You should request a CDP hearing if you feel the levy is inappropriate.
However, as explained in Publication 1660, in a CDP hearing Appeals can only discuss the existence of or amount that you owe under very limited circumstances.
If Appeals cannot consider the underlying liability, you have three options to re-open that issue:
1. Pay the amount due in full and file a claim for refund. If the IRS disallows your claim you will have the right to Appeals at that time.
2. Follow the instructions in Publication 3598 and request an Audit Reconsideration. Note that you must submit new information the IRS did not previously consider in order to have an audit reconsideration.
3. Follow the instructions in Form 656 and file an Offer in Compromise, Doubt as to Liability.
If you have any questions regarding an IRS final notice and need professional tax help call us today we can explain to you the different ways on how to stop the IRS.
IRS Final Notice Tax Help, How to STOP the IRS.
by Fresh Start Tax | Aug 8, 2013 | Tax Help
Summer Job Tax Information for Students
When summer vacation begins, classroom learning ends for most students. Even so, summer doesn’t have to mean a complete break from learning. Students starting summer jobs have the opportunity to learn some important life lessons. Summer jobs offer students the opportunity to learn about the working world – and taxes.
Here are things about summer jobs that the IRS and Fresh Start Tax LLC wants students and other to know about:
1. As a new employee, you’ll need to fill out a Form W-4, Employee’s Withholding Allowance Certificate. Employers use this form to figure how much federal income tax to withhold from workers’ paychecks.
It is important to complete your W-4 form correctly so your employer withholds the right amount of taxes. You can use the IRS Withholding Calculator tool at IRS.gov to help you fill out the form.
If you do not understand the withholding process you should ask your parents or someone knowledgeable to make sure you put down the correct withholding. Do not take a guess.
2. If you’ll receive tips as part of your income, remember that all tips you receive are taxable. Keep a daily log to record your tips. If you receive $20 or more in cash tips in any one month, you must report your tips for that month to your employer. You may want to keep a separate log for your tips.
3. Maybe you will earn money doing odd jobs this summer.
If so, keep in mind that earnings you receive from self-employment are subject to income tax. Self-employment can include pay you get from jobs like baby-sitting and lawn mowing.
4. You may not earn enough money from your summer job to owe income tax, but you will probably have to pay Social Security and Medicare taxes.
Your employer usually must withhold these taxes from your paycheck. Or, if you’re self-employed, you may have to pay self-employment taxes.
Your payment of these taxes contributes to your coverage under the Social Security system.
5. If you’re in ROTC, your active duty pay, such as pay received during summer camp, is taxable.
However, the food and lodging allowances you receive in advanced training are not.
6. If you’re a newspaper carrier or distributor, special rules apply to your income. Whatever your age, you are treated as self-employed for federal tax purposes if:
- You are in the business of delivering newspapers.
- Substantially all your pay for these services directly relates to sales rather than to the number of hours worked.
- You work under a written contract that states the employer will not treat you as an employee for federal tax purposes.
If you do not meet these conditions and you are under age 18, then you are usually exempt from Social Security and Medicare tax.
If you need professional tax preparation contact us today. 1-866-700-1040.
by Fresh Start Tax | Aug 8, 2013 | FBAR
We are a full service professional tax firm that specializes in FBAR professional tax services.
From the filing of FBAR, to FBAR audits, paying back taxes and civil and criminal FBAR defense we can help resolve your FBAR issues.
We are comprised of tax attorneys, certified public accountants, and former IRS agents, managers and tax instructors.
We have been practicing since 1982 and have an A+ rating by the Better Business Bureau.
Fresh Start Tax llc has over well over 300 years of professional tax experience dealing with the simplest of cases to Tax Court representation.
There are many excellent professional tax firms that specializes in FBAR tax service and we believe we are among them.
As a Former IRS Agent
As Former IRS agent the best advice I can give you is not to fool around with FBAR.
The Internal Revenue Service and the Department of Justice are launching full-scale investigations.
There are approximately 80 countries that have made treaties with the United States to exchange financial information of all US taxpayers.
The Internal Revenue Service and the federal government realizes there are billions of dollars at stake that can be put into the US Treasury and since there are paper trails, the targets are now easy to catch.
Also the threat and fear of criminal prosecution and prison time looms large. Our best advice is to find IRS before they find you.
If you have a potential problem are uneasy about your position contact us today for a free initial tax consultation. All information is held under attorney-client privilege.
The recent news coming from the GAO is the following:
- The Four Offshore Programs
As of December 2012, the Internal Revenue Service’s (IRS) four offshore programs have resulted in more than 39,000 disclosures by taxpayers and over $5.5 billion in tax revenues.
- Why the attraction to the program
The offshore programs attract taxpayers by offering a reduced risk of criminal prosecution and lower penalties than if the unreported income was discovered by one of IRS’s other enforcement programs.
- Penalty aspects of the Case
For the 2009 Offshore Voluntary Disclosure Program (OVDP), nearly all program participants received the standard offshore penalty–20 percent of the highest aggregate value of the accounts–meaning the account value was greater than $75,000 and taxpayers used the accounts (e.g., made deposits or withdrawals) during the period under review.
- The median account balances
The median account balance of the more than 10,000 cases closed so far from the 2009 OVDP was $570,000.
Participant cases with offshore penalties greater than $1 million represented about 6 percent of all 2009 OVDP cases, but accounted for almost half of all offshore penalties. Taxpayers from these cases disclosed a variety of reasons for having offshore accounts, and more than half of them had accounts at Swiss bank UBS.
Using 2009 OVDP data, IRS identified bank names and account locations that helped it pursue additional noncompliance.
Based on a review of cases, GAO found examples of immigrants who stated in their 2009 OVDP applications that they were unaware of their offshore reporting requirements. IRS officials from the Offshore Compliance Initiative office said they have not targeted outreach efforts to new immigrants.
Using information from the 2009 OVDP, such as the characteristics of taxpayers who were not aware of their reporting requirements, to increase education and outreach to those populations could promote voluntary compliance.
- Attempting to circumvent paying the taxes
IRS has detected some taxpayers with previously undisclosed offshore accounts attempting to circumvent paying the taxes, interest, and penalties that would otherwise be owed, but based on GAO reviews of IRS data, IRS may be missing attempts by other taxpayers attempting to do so.
GAO analyzed amended returns filed for tax year 2003 through tax year 2008, matched them to other information available to IRS about taxpayers’ possible offshore activities, and found many more potential quiet disclosures than IRS detected.
Moreover, IRS has not researched whether sharp increases in taxpayers reporting offshore accounts for the first time is due to efforts to circumvent monies owed, thereby missing opportunities to help ensure compliance.
From tax year 2007 through tax year 2010, IRS estimates that the number of taxpayers reporting foreign accounts nearly doubled to 516,000. Taxpayer attempts to circumvent taxes, interest, and penalties by not participating in an offshore program, but instead simply amending past returns or reporting on current returns previously unreported offshore accounts, result in lost revenues and undermine the programs’ effectiveness.
If you have a financial interest in or signature authority over a foreign financial account, including a bank account, brokerage account, mutual fund, trust, or other type of foreign financial account, exceeding certain thresholds, the Bank Secrecy Act may require you to report the account yearly to the Internal Revenue Service by filing a Report of Foreign Bank and Financial Accounts (FBAR). See the ‘Who Must File an FBAR’ section below for additional criteria.
Current FBAR Guidance
FBAR final regulations
On February 24, 2011, the Treasury Department published final FBAR regulations. These regulations became effective March 28, 2011, and apply to FBARs required to be filed with respect to foreign financial accounts maintained at any time during calendar year 2010, and for FBARs required to be filed with respect to all subsequent calendar years.
The FBAR form and instructions were revised to reflect the amendments made by the final regulations.
Filing deferral for certain individuals with signature authority only, effective through June 30, 2014
On May 31, 2011, the Financial Crimes Enforcement Network (FinCEN) issued FinCEN Notice 2011-1 (revised June 6, 2011), to provide an extension of time for certain individuals with signature authority over, but no financial interest in, foreign financial accounts of their employer or a closely related entity.
The filing deadline to report signature authority over these accounts was extended to June 30, 2012, for the following individuals:
- An employee or officer of an entity under 31 CFR § 1010.350(f)(2)(i)-(v) who has signature or other authority over and no financial interest in a foreign financial account of a controlled person of the entity; or
- An employee or officer of a controlled person of an entity under 31 CFR § 1010.350(f)(2)(i)-(v) who has signature or other authority over and no financial interest in a foreign financial account of the entity, the controlled person, or another controlled person of the entity.
For purposes of FinCEN Notice 2011-1, a controlled person is a United States or foreign entity more than 50 percent owned (directly or indirectly) by an entity under 31 CFR § 1010.350(f)(2)(i)-(v).
On June 17, 2011, FinCEN issued Notice 2011-2 to provide an extension of time to file for certain officers or employees of investment advisors registered with the Securities and Exchange Commission who have signature authority over, but no financial interest in, foreign financial accounts of their employer.
The filing deadline for employees and officers to report signature authority over these accounts was similarly extended to June 30, 2012.
Due to additional questions and concerns regarding the signature authority filing exceptions within Notice 2011-1 and Notice 2011-2, FinCEN twice extended the revised filing deadlines imposed by those two notices.
On February 14, 2012, FinCEN issued FinCEN Notice 2012-1, extending the deadline to file to June 30, 2013, for those persons identified in Notice 2011-1 and Notice 2011-2. More recently, on December 26, 2012, FinCEN issued Notice 2012-2, further extending the due date for filing to June 30, 2014.
Who Must File an FBAR
United States persons are required to file an FBAR if:
- The United States person had a financial interest in or signature authority over at least one financial account located outside of the United States; and
- The aggregate value of all foreign financial accounts exceeded $10,000 at any time during the calendar year to be reported.
United States person means U.S. citizens; U.S. residents; entities, including but not limited to, corporations, partnerships, or limited liability companies, created or organized in the United States or under the laws of the United States; and trusts or estates formed under the laws of the United States.
Contact us for an immediate tax consultation and hear the truth about your case from a very reputable and experienced professional tax firm.
FBAR TAX SERVICES – Attorneys, CPA’s – Affordable FBAR Tax Services Experts
