by Fresh Start Tax | May 6, 2013 | Back Taxes
Back Taxes – How/Methods to Settle with the IRS – Use Former IRS Agents 1-866-700-1040
The Internal Revenue Service accepts approximately 30% of all offers in compromise filed each year.
There are 58,000 settlement offers made to the Internal Revenue Service nationwide each year. The average settlement time is 6 to 9 months.
If you have back tax issues and you need to know how to settle with the Internal Revenue Service contact us today and you can speak directly to former IRS agents and managers who have been with the Internal Revenue Service for over 60 years in the local, district, and regional tax offices of the Internal Revenue Service. We can discuss the how and the methods.
Not only did we work at the Internal Revenue Service we also taught the IRS methods of tax debt settlements to the new IRS agents called the offer in compromise.
In settling tax debt with the Internal Revenue Service on back taxes it is extremely important for taxpayers to understand the process.
No taxpayer should submit an offer compromise unless they know the formulas that will be applicable to their own case.
As a general rule, IRS looks at two factors when looking to settle a taxpayers debt. Assets and Income.
The Internal Revenue Service is going to want to know what is the some total equity in all your assets and they are going to want to know how much disposable income that you have at the end of every month. The necessary living expenses that they will allow are governed by the Department of Labor. There are national and geographical regional standards already set up by the Internal Revenue Service.
IRS will then add the sum total of your assets plus the excess disposable income times 12 as a settlement basis for most offers in compromise.
IRS will want a completed 433-OIC which you can find on our website and they will want all supporting documentation to verify all the income and expenses.
IRS spends a considerable amount of time working in offer in compromise. As a general rule and offered compromise takes about 20 to 30 hours work of worth of work for the IRS closing agent. The average closing time is anywhere from 6 to 9 months.
Any taxpayer who wants to go ahead and settle their back tax debt should walk through the pre-qualifier program that IRS has on offers in compromise. You can find that pre-qualifier tool on our site. This is one of the best methods to find out if you can settle with the Internal Revenue Service.
I would recommend that any taxpayer who wants to learn more on the different methods or how to settle their back taxes with the Internal Revenue Service to contact us for free initial consultation and we will review their case for them.
What is an offer in compromise or settling with the Internal Revenue Service
An offer in compromise/ tax debt settlement 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 will consider your unique set of facts and circumstances. IRS will specifically look at your:
1. Ability to pay;
2. Income;
3. Expenses; and
4. Asset equity.
The Internal Revenue Service will generally approve an offer in compromise when the amount offered represents the most we can expect to collect within a reasonable period of time.
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. You should consider checking BBB ratings and also check out the experience of the tax professional that will be working your case.
Make sure you are eligible for an offer in compromise or tax debt settlement
Before the Internal Revenue Service can consider your offer, you must be current with all filing and payment requirements.
In Bankruptcy?
You are not eligible if you are in an open bankruptcy proceeding.
Submitting your offer/settlement
You’ll find step-by-step instructions and all the forms for submitting an offer in the Offer in Compromise Booklet, Form 656-B (PDF).
Your completed offer package will include:
a. Form 433-A (OIC) (individuals) or 433-B (OIC) (businesses) and all required documentation as specified on the forms;
b. Form 656(s) – individual and business tax debt (Corporation/ LLC/ Partnership) must be submitted on separate Form 656;
c. $150 application fee (non-refundable); and
Initial payment (non-refundable) for each Form 656.
Select a payment option to pay the back taxes
Your initial payment will vary based on your offer and the payment option you choose:
Lump Sum Cash Payment:
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 Payments:
Submit your initial payment with your application. Continue to pay the remaining balance in monthly installments while the IRS considers your offer.
If accepted you must continue to pay monthly until it is paid in full.
If you meet the Low Income Certification guidelines, you do not have to send the application fee or the initial payment and you will not need to make monthly installments during the evaluation of your offer.
While your offer/method is being evaluated:
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.
Other factors to consider
a. A Notice of Federal Tax Lien may be filed;
b. Other collection activities are suspended;
c. The legal assessment and collection period is extended;
d. Make all required payments associated with your offer;
e. You are not required to make payments on an existing installment agreement; and
f. Your offer is automatically accepted if the IRS does not make a determination within two years of the IRS receipt date.
To summarize, the most important thing to know about paying your back taxes and settling with the Internal Revenue Service is to understand the how and the method of tax debt settlements.
That’s why we are critical to walk to through the pre-qualifier tool on our website to make sure you are eligible for the IRS offer in compromise tax debt settlement. It is also critical you to talk to a tax professional expert in back tax matter settling with the IRS.
There are a lot of scam artists out there so make sure you check out the credentials of person who will be directly working your case
by Fresh Start Tax | May 2, 2013 | Back Taxes
Unpaid Back Taxes – Settle with the IRS – Affordable Back Tax Solutions 1-866-700-1040
If you owe unpaid back taxes to the Internal Revenue Service call us today to find out the different tax options that you have available to you to deal, settle, and negotiate your tax debt with the Internal Revenue Service.
We can offer a variety of affordable backpack solutions.
We are comprised of tax attorneys, tax lawyers, certified public accountants, and former IRS agents and managers who true tax experts in dealing with unpaid back taxes.
We have over 206 years of professional tax spreads in over 60 years of working for the Internal Revenue Service and the local, district, and regional tax offices of the IRS.
By filling out a simple IRS financial statement which you can find on our website, we can fully evaluate your case and give you a very affordable tax recommendation solution to both deal and settle with the Internal Revenue Service. Evaluations are free of charge.
IRS will want a current financial statement to Settle with the IRS on Unpaid Back Taxes
The Internal Revenue Service deals with unpaid back taxes by analyzing the taxpayer’s current ability to pay the IRS. The IRS uses form 433-F to make that determination. IRS will want full substantiation and verification of this simple two-page IRS financial statement before they will make a determination on how they will negotiate your tax case.
IRS will want to see your last pay stub, your last 3 to 6 months bank statements and a copy of all your monthly bills and expenses. Once the Internal Revenue Service reviews this financial statement they will easily be able to make a determination on how they are very close your case and settle your IRS tax problem on your unpaid back taxes.
If you owe under $50,000 to Internal Revenue Service you may qualify for the streamlined agreement. You will have to pay your tax liability off within 72 months on 72 equal payments.
As a general rule there are three ways the Internal Revenue Service will remove your case off the IRS enforcement computer.
Hardship
IRS may determine based on your current financial statement that you have more expenses and income and they have the option to put you into a non-collectible or currently not collectible status. The status is usually lasts 2 to 3 years or until the taxpayers income sufficiently increases.
Payment Plan
IRS may determine as a result of your current financial statement that you can make a current payment and put you on a monthly installment agreement.
IRS Offer in Compromise or Tax Debt Settlement
IRS lastly may determine that you are an excellent candidate for an IRS offer in compromise or a tax debt settlement called. This is what is commonly known as settling for pennies on a dollar or settling with the Internal Revenue Service.
To settle with the Internal Revenue Service there is a pre-qualifier tool that you can use, it you can find it on our website.
You can walk through this program yourself to find out whether you are a true IRS settlement candidate.
Before I recommend that any taxpayer enter into a settlement with the Internal Revenue Service or file an offer in compromise they either walk through the pre-qualifier tool or speak to somebody who is a true tax experts in the offer in compromise program.
You should know that I was a former IRS agent in teaching instructor with the Internal Revenue Service taught the offer in compromise program to new IRS agents.
You can contact us today and we can make a recommendation for you to settle with the IRS or give you tax options for other affordable back tax solutions.
Unpaid Back Taxes – Settle with the IRS – Affordable Back Tax Solutions
by Fresh Start Tax | May 2, 2013 | Back Taxes
IRS Back Taxes – Easy Payment Plans – We make it Easy & Affordable 1-866-700-1040
If you owe back IRS taxes call us today and we can find a simple solution for you to deal with your IRS problem.
We are comprised of tax attorneys, certified public accountants, and former IRS agents managers and instructors that have over 60 years of working directly for the Internal Revenue Service in the local, district, and regional tax office of the Internal Revenue Service.
We taught tax law at the IRS.
We have an A+ rating by the Better Business Bureau and a been in private practice since 1982.
We can make dealing with the Internal Revenue Service on your back IRS tax and easy process for you. We have processed thousands of cases involving IRS back taxes and payment plans.
We may also recommend you for the IRS offer in compromise program which is a tax debt settlement program. You must qualify for the program.
How to pay back taxes within easy payment plan
IRS has a variety of options to make back payments to the Internal Revenue Service with their various type of payment plans.There probably is one that will suit your needs that fits within your lifestyle and budget.
You should know that the Internal Revenue Service will use the national and regional standard testing to qualify you for a payment plan if you owe over $50,000.
This process becomes very simple when you owe under $50,000.
You can make monthly payments through an installment agreement if you’re not financially able to pay your tax debt immediately.
However, you will reduce or eliminate the amount of penalties and interest you pay and avoid the fee associated with setting up an installment agreement if you pay your tax bill in full.
Do you owe Business Tax – In-Business Trust Fund Express Installment Agreements
Small businesses who currently have employees can qualify for an In-Business Trust Fund Express Installment Agreement (IBTF-Express IA). These installment agreements generally do not require a financial statement or financial verification as part of the application process.
The criteria to qualify for an IBTF-Express IA are:
1. You owe $25,000 or less at the time the agreement is established. If you owe more than $25,000, you may pay down the liability before entering into the agreement in order to qualify.
2. The debt must be full paid within 24-months or prior to the Collection Statute Expiration Date whichever is earlier.
Direct Debit installment agreement (DDIA)
You must enroll in a Direct Debit installment agreement (DDIA) if the amount you owe is between $10,000 and $25,000.
You must be compliant with all filing and payment requirements.
For Individuals – Streamlined Installment Agreements Owe Under $50,000
The Fresh Start provisions also mean that more taxpayers will have the ability to use streamlined installment agreements to catch up on back taxes.
Under the Fresh Start initiative, the maximum dollar criteria for streamlined installment agreements has been raised from $25,000 to $50,000 and the maximum term has been raised from 60 months to 72 months.
These installment agreements generally do not require a financial statement, but a limited amount of financial information may be required in the application process.
The Streamlined Installment Agreement criteria is divided into two categories, balance due of $25,000 or less, and balance due $25,001 to $50,000.
The criteria to qualify for streamlined installment agreements with a balance due of $25,00 or less are:
1. You owe $25,000 or less, at the time the agreement is established. If you owe more than $25,000, you may pay down the liability before entering into the agreement in order to qualify.
2. The debt must be full paid within 72-months or prior to the Collection Statute Expiration Date, whichever is earlier.
3. You must be compliant with all filing and payment requirements.
4. Individuals who owe any type of tax (Form 1040, Trust Fund Recovery Penalty, etc.).
5. Defunct businesses, including any type of entity and any type tax (Form 940, 941, 943, etc.).
6. Operating businesses are limited to income tax liabilities only (Form 1120).
The criteria to qualify for streamlined installment agreements with a balance due of $25,001 to $50,000 are:
1. You owe $25,001 to $50,000, at the time the agreement is established. If you owe more than $50,000, you may pay down the liability before entering into the agreement in order to qualify.
2. The debt must be full paid within 72-months or prior to the Collection Statute Expiration Date, whichever is earlier.
3. You must be compliant with all filing and payment requirements.
4. Individuals who owe any type of tax (Form 1040, Trust Fund Recovery Penalty, etc.).
Businesses are limited to defunct sole proprietors who owe any type of tax (Form 940, 941, 943, etc.).
5. You must enroll in a Direct Debit Installment Agreement.
A limited amount of financial information may be required during the application process.
Taxpayers seeking installment agreements exceeding $50,000 will still need to supply the IRS with a Collection Information Statement (Form 433-A (PDF) or Form 433-F (PDF)).
IRS Back Taxes – Easy Payment Plans – We make it Easy & Affordable
by Fresh Start Tax | May 2, 2013 | Back Taxes
How to Resolve a IRS Bill Notice on Back Taxes 1-866-700-1040
If you have received an IRS tax bill or notice on your back taxes contact us today to find out how to take care of this matter as soon as possible for affordable pricing.
We have worked thousands of cases in resolving IRS tax notices and bills.
We are comprised of tax attorneys, certified public accountants, enrolled agents, and former IRS agents and managers with over 60 years of direct work experience with the Internal Revenue Service in the local, district, and regional tax offices of the Internal Revenue Service.
We are A+ rated by the better business bureau and been in private practice since 1982.
How to resolve than IRS bill or notice on back taxes.
There is a very specific process on how to resolve your IRS bill or notice on your back tax. There is a very specific protocol that IRS uses on every single case and that is the IRS requires a current and verifiable financial statement which is IRS form 433F.
You can find that form on our website.
The 433-F can either be sent to the Internal Revenue Service at the ACS unit or you can simply call the one 800 number on your last IRS bill or notice and speak to the IRS agent directly. The IRS agent on the phone will require you to fax the 433-F along with all the documentation to confirm the accuracy and correctness of the tax return.
Beside turning in the IRS financial statement you will be required to turn in your last 3 to 6 months bank statements along with your pay stubs and verify all monthly expenses.
Once the IRS has the 433-F and their hand the IRS will make a determination on how they will close the case off the enforcement computer.
If you do not resolve this matter while your case is in billing or notice status the Internal Revenue Service will issue an IRS bank levy or an IRS wage garnishment levy and will follow up with the filing of the federal tax lien.
It is of utmost importance that you call IRS before the final notice time period runs. All IRS collection notices are systemically handled by the IRS computer and not a human hand touches them.
All notices of banks garnishments and wage garnishments are sent out in the thousands each and every day. That is why it is critical to call the IRS so they can input a systemic freeze on your case.
IRS will use your several tax last tax returns as Levy source information to issue a bank or wage garnishment levy.
As a general rule there are three closing methods to get IRS off your back.
After IRS reviews the financial statement they will make one of three determinations.
The IRS will either determine that you are at the current time non-collectible and place you into an economic tax hardship, they can determine that you are a monthly installment payment candidate or the IRS could recommend that you file an IRS tax debt settlement called an offer in compromise.
It also should be known that you must have all tax returns filed and brought up to date along with your current withholding for the year.
IRS will conduct a full compliance check to make sure that all tax returns have been filed and you are currently up to date with this year’s withholding.
IRS will use the national and local standards test to determine that you are living within the IRS framework in budgetary standards for hardships. It is critically important that you understand the national and regional standards test before negotiating any IRS tax bill or notice because that is the sole key in resolving your IRS case on your back taxes.
This process is a very simple one but it all depends on your financial statement. I cannot tell you how important it is to understand the process.IRS uses the financial statement to there benefit not yours.
Free Consultations
If you would like a free consultation contact us today and we can tell you how easy it is to resolve your situation with the Internal Revenue Service.
You can also fill out a form 433-F and fax it to us and we will go over all the tax options you have and show you how to resolve this.
This is a much easier process than you think you just need to speak to experienced former IRS agents who know the process, the format in the protocols to deal with the situation.
We have over 60 years of direct working knowledge and experience with the IRS we can make this process seamless for you.
You will never have to speak to the Internal Revenue Service.
How to Resolve a IRS Bill Notice on Back Taxes, Former Agent can make this an easy process
by Fresh Start Tax | May 2, 2013 | Back Taxes
Back Taxes – File and Settle with the IRS – Easier than you Think 1-866-700-1040
If you need to file and pay back taxes the process is much easier than you think.
We are comprised of tax attorneys, certified public accountants and former IRS agents and managers who have over 60 years of direct work knowledge and experience working at the IRS. We also taught tax law at the Internal Revenue Service to new IRS agents.
Our firm has over 206 years of professional tax experience and we are A+ rated by the Better Business Bureau and have been in private practice since 1982.
We are tax experts on back taxes that include includes the filing of back tax returns and the settling with the Internal Revenue Service of back tax debt.
How to File Back IRS Tax Returns
Most people come to us needing to file multiple back years tax returns and the common questions that ask is “should I file them all at the same time?”
And the answer is a resounding yes. You do this so you can close your case all that one time and in doing so you will save yourself tons of money.
Do not be afraid to file them all at one time
Most people who have to file multiple back years are hesitant because of fear or worry. Many have lost their tax records to complete the filing of their tax returns.
If this is your case we should be able to remove your fear and worry and file all your back years tax returns and work out a tax settlement with the Internal Revenue Service.
If you have lost, stolen or damaged tax records that is no problem. There is a very specific problem to resolve this and is called tax reconstruction.
If this is the case do not be alarmed or afraid because you don’t have the all your tax records to file your back tax returns. We are tax experts in tax reconstruction in the filing of back income and business tax returns.
We have filed thousands of reconstructed tax returns and we know the exact process and we can make this very simple for you.
Income Tax Reconstruction on Back Taxes
We have forms to send to taxpayers to help them reconstruct their back tax returns. The form is basic and simple, a taxpayer simply fills out what their average expenses are for a given month and we generally multiply that times 12 to come up with an approximate figure of what annual income would have been if records are lost. We also review and examine bank statements to ensure the accuracy of the tax return and the income.
If you need to pay your back taxes you must fill out form 433-F which is a IRS financial statement
There are multiple tax options in paying your back taxes and the key to doing so is the completion of the IRS financial statement form 433-F.
The Internal Revenue Service will close no case off their enforcement computers unless they have a current and documented financial statement. There is an art to filling this form out correctly and so that IRS accepts this verifiable financial statement the first time around.
You can find that 433-F on our website.
Free Evaluation of your Case
Complete the 433F and send it to us and we will do a free tax evaluation on your case and will let you know how the IRS will treat or handle your case. The 433F is a very two-page form to fill out that will take us no less than five minutes to explain your different tax options. Like I said before this is a very simple process that’s easier than you think.
Some taxpayers cannot pay back taxes, for that there is a IRS Tax Hardship
Factors that support an economic hardship determination may include:
The taxpayer is incapable of earning a living because of a long term illness, medical condition or disability, and it is reasonably foreseeable that the financial resources will be exhausted providing for care and support during the course of the condition.
The taxpayer may have a set monthly income and no other means of support and the income is exhausted each month in providing for the care of dependents.
The taxpayer has assets, but is unable to borrow against the equity in those assets, and liquidation to pay the outstanding tax liabilities would render the taxpayer unable to meet basic living expenses.
Someone in the immediate family of the taxpayer has been hit with a catastrophe.
An act of God causing an unforeseen occurrence.
The bottom line to an IRS tax hardship is that a taxpayer is having a current time meeting normal necessary living expenses. You should be apprised that there is a national and regional standards test that must be met.
Remember, each situation is different and each and every case is based on its own merit.
No two cases are ever the same.
If you cannot pay your back taxes IRS can place you into a currently non-collectible file.
IRS will review your current financial statement and may determine that at the present time your expenses exceed your income and that aligns with the national and regional standard test that IRS uses to determine hardship, payments and IRS tax debt settlement. So if this is you contact us today we will review your financial statement and see if you are a true candidate for an economic tax hardship called currently noncollectable.
IRS making payments to the Internal Revenue Service
There are many programs available to you to help you make back payments to the Internal Revenue Service.
Once again your 433F financial statement will allow IRS to see how much that monthly payment should be.
There is also another tool available to the taxpayer and that is to make a streamlined payment for those of you who owe under $50,000 and can pay IRS off within six years.
Contact us today to learn more about the program by making a payment or installment arrangement to the Internal Revenue Service.
Paying back taxes with a tax debt settlement:
The Offer and Compromise
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.
The Internal Revenue Service will consider your unique set of facts and circumstances such as:
a. Ability to pay;
b. Income;
c. Expenses; and
d. Asset equity.
As a former IRS agent and teaching instructor with the Internal Revenue Service I taught this offer in compromise program. I am a true tax expert in IRS tax settlements and negotiations with federal and state tax debt
The IRS generally approve an offer in compromise when the amount offered represents the most we can expect to collect within a reasonable period of time.
You should explore all other payment options before submitting an offer in compromise. The Offer in Compromise program is not for everyone.
Make sure you are eligible for a Tax Settlement
Before the IRS will can consider your offer, you must be current with all filing and payment requirements. This means that all tax returns must be filed out and up to date and you have current withholding taken out or have made the proper estimate payments for the current tax year.
Are you in an open bankruptcy proceeding
You are not eligible if you are in an open bankruptcy proceeding.
Offer in Compromise Pre-Qualifier
Use the Offer in Compromise Pre-Qualifier to confirm your eligibility and prepare a preliminary proposal. You can find this pre-qualifier tool on our website and we recommend that no taxpayer submit an IRS offer in compromise or a tax debt settlement without filling out the pre-qualifier tool or speaking to an expert in IRS tax settlements.
Submitting your offer or settlement package
You’ll find step-by-step instructions and all the forms for submitting an offer in the Offer in Compromise Booklet, Form 656-B (PDF).
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 Form 656;
3. $150 application fee (non-refundable); and
Initial payment (non-refundable) for each Form 656.
Select a payment tax payment option for settlement
Your initial payment will vary based on your offer and the payment option you choose:
1. 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.
2. 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.
Contact us today about finding out all your options and your back tax debt to the Internal Revenue Service. We can file all your back tax returns and settle with the Internal Revenue Service all one time. It is much easier than you think and you talk to affordable tax experts.
Back Taxes – File and Settle with the IRS – Easier than you Think
by Fresh Start Tax | May 2, 2013 | Back Taxes
Back IRS Taxes – Different Options to Resolve your Back Tax Debt 1-866-700-1040
Through the new IRS fresh start program or fresh start initiative the Internal Revenue Service is trying to help those taxpayers with back IRS tax debt.
There are a new series of programs that IRS is offering that is helping thousands upon thousands of taxpayers to deal with their IRS debt in a more user-friendly way.
Millions of taxpayers owe back IRS taxes and IRS for years has been very keen on enforcement. As a matter of fact the IRS files 3.6 million tax levies and 980,000 federal tax liens each and every year.
If the taxpayer reaches out to the Internal Revenue Service before the IRS reaches out to them, taxpayers will find a very simple road to hoe.
If IRS reaches out first it becomes much more costly and much more lengthily and usually involves professional representation to resolve your IRS problem.
If you are looking for help for back IRS tax issue contact us today and speak directly to tax attorneys, certified public accountants, or former IRS agents who understand the issues that can explain the various options to you to help take care of back IRS taxes.
We can review with you your various options to completely and immediately resolved your IRS back tax debt.
The Internal Revenue Service latest effort
In its latest effort to help struggling taxpayers, the Internal Revenue Service today announced a series of new steps to help people get a fresh start with their tax liabilities.
The goal is to help individuals and small businesses meet their tax obligations, without adding unnecessary burden to taxpayers.
Specifically, the IRS is announcing new policies and programs to help taxpayers pay back taxes and avoid tax liens.
The new changes include:
1. Significantly increasing the dollar threshold when liens are generally issued, resulting in fewer tax liens.
2. Making it easier for taxpayers to obtain lien withdrawals after paying a tax bill.
Withdrawing liens in most cases where a taxpayer enters into a Direct Debit Installment Agreement.
3. Creating easier access to Installment Agreements for more struggling small businesses.
4. Expanding a streamlined Offer in Compromise program to cover more taxpayers.
Home refinancing
This is another in a series of steps to help struggling taxpayers. In 2008, the IRS announced lien relief for people trying to refinance or sell a home. In 2009, the IRS added new flexibility for taxpayers facing payment or collection problems.
New Federal Tax Lien Thresholds
The IRS will significantly increase the dollar thresholds when liens are generally filed. The new dollar amount is in keeping with inflationary changes since the number was last revised.
Currently, liens are automatically filed at $10,000 levels for people with past-due balances.
The IRS plans to review the results and impact of the lien threshold change in about a year.
The federal tax lien
A federal tax lien gives the IRS a legal claim to a taxpayer’s property for the amount of an unpaid tax debt. Filing a Notice of Federal Tax Lien is necessary to establish priority rights against certain other creditors.
Usually the government is not the only creditor to whom the taxpayer owes money.
A lien informs the public that the U.S. government has a claim against all property, and any rights to property, of the taxpayer.
This includes property owned at the time the notice of lien is filed and any acquired thereafter.
A federal tax lien will affect a taxpayer’s credit rating, so it is critical to arrange the payment of taxes as quickly as possible. You loans
Federal Tax Lien Withdrawals
The IRS will also modify procedures that will make it easier for taxpayers to obtain lien withdrawals.
Liens will now be withdrawn once full payment of taxes is made if the taxpayer requests it. The IRS has determined that this approach is in the best interest of the government.
In order to speed the withdrawal process, the IRS will also streamline its internal procedures to allow collection personnel to withdraw the liens.
Direct Debit Installment Agreements and Liens
The IRS is making other fundamental changes to liens in cases where taxpayers enter into a Direct Debit Installment Agreement (DDIA).
For taxpayers with unpaid assessments of $25,000 or less, the IRS will now allow lien withdrawals under several scenarios:
Lien withdrawals for taxpayers entering into a Direct Debit Installment Agreement.
The IRS will withdraw a lien if a taxpayer on a regular Installment Agreement converts to a Direct Debit Installment Agreement.
The IRS will also withdraw liens on existing Direct Debit Installment agreements upon taxpayer request.
Liens will be withdrawn after a probationary period demonstrating that direct debit payments will be honored.
In addition, this lowers user fees and saves the government money from mailing monthly payment notices. Taxpayers can use the Online Payment Agreement application on IRS.gov to set-up with Direct Debit Installment Agreements.
Installment Agreements and Small Businesses
The IRS will also make streamlined Installment Agreements available to more small businesses. The payment program will raise the dollar limit to allow additional small businesses to participate.
Small businesses with $25,000 or less in unpaid tax can participate. Currently, only small businesses with under $10,000 in liabilities can participate.
Small businesses will have 24 months to pay.
The streamlined Installment Agreements will be available for small businesses that file either as an individual or as a business.
Small businesses with an unpaid assessment balance greater than $25,000 would qualify for the streamlined Installment Agreement if they pay down the balance to $25,000 or less.
Small businesses will need to enroll in a Direct Debit Installment Agreement to participate.
Offers in Compromise or Tax Debt Settlements
The IRS is also expanding a new streamlined Offer in Compromise (OIC) program to cover a larger group of struggling taxpayers. You can find this form on our website.
This streamlined OIC is being expanded to allow taxpayers with annual incomes up to $100,000 to participate. In addition, participants must have tax liability of less than $50,000, doubling the current limit of $25,000 or less.
OICs are subject to acceptance based on legal requirements. 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.
Generally, an offer 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.
You should also know to work a completed offer compromise is somewhere in the time range is 6 to 9 months.
This is a very slow process and it’s critical that taxpayers understand the importance of documentation and the correctness of the financial statement that they turned in to the IRS.
A taxpayer should not turning an offer in compromise until late every explored the pre-qualifier tool that you can find on our website.
Back IRS Taxes – Different Options to Resolve your Back Tax Debt
