We are former IRS Agents, we are practicing Christians at our local churches. IRS has just hired record number of new IRS Agents and this will be a record breaking tax audit season.
Should you fall prey to one of these tax audits, please feel free to contact us. 1-866-700-1040.
Church Audit Process used by the IRS The following is the sequence of the church audit process.:
1. If the reasonable belief requirement is met, the IRS must begin an inquiry by providing a church with written notice containing an explanation of its concerns.
2. The church is allowed a reasonable period in which to respond by furnishing a written explanation to alleviate IRS concerns.
3. If the church fails to respond within the required time, or if its response is not sufficient to alleviate IRS concerns, the IRS may, generally within 90 days, issue a second notice, informing the church of the need to examine its books and records.
4.After issuance of a second notice, but before commencement of an examination of its books and records,the church may request a conference with an IRS official to discuss IRS concerns. The second notice will contain a copy of all documents collected or prepared by the IRS for use in the examination and subject to disclosure under the Freedom of Information Act, as supplemented by IRC section 6103 relating to disclosure and confidentiality of tax return information. Generally, examination of a church’s books and records must be completed within two years from the date of the second notice from the IRS.
If at any time during the inquiry process the church supplies information sufficient to alleviate the concerns of the IRS, the matter will be closed without examination of the church’s books and records. There are additional safeguards for the protection of churches under Internal Revenue Code section 7611. For example, the IRS cannot begin a subsequent examination of a church for a five-year period unless the previous examination resulted in a revocation, notice of deficiency of assessment, or a request for a significant change in church operations, including a significant change in accounting practices.
Is the IRS trying to assess the trust fund recovery penalty against you?
It is known as the 6672 Penalty.
Here is what to do to avoid the Trust fund Recovery Penalty:
File a “Formal Written Protest”
The potentially responsible party should submit a Formal Written Protest in duplicate and should include:
The responsible party’s name, address, and Social Security number
A copy of the Letter 1153(DO) or date and number of the letter
A statement that the responsible party wants a conference
The tax periods involved (from Form 2751)
A list of issues the responsible party disagrees with and an explanation of why he or she disagrees
Note:
The following statement must be added to declare that the information submitted in this item is true: “Under penalties of perjury, I declare that I have examined the facts presented in this statement and any accompanying information, and, to the best of my knowledge and belief, they are true, correct, and complete.”
If applicable, the law or other authority the responsible party is relying on to support his or her arguments along with an explanation of what the law is and how it applies.
Big Tip: Remember, if the trust fund penalty has been assessed, you can always file an 843 claim, pay the $50 dollars and have a hearing. The other option is to file an Offer in Compromise, Doubt as to Collectibility.
Fresh Start Tax is comprised of Former IRS Agents, Managers and Instructors. The staff also includes CPA’s, tax attorneys and former Managers with the Department of Revenue.
Our company are experts in the field of tax and tax resolution.
We are licensed to practice in all 50 States. We are fast, affordable and put a premium on communication with our client. Our firm has the highest rating given out by the Better Business Bureau.
We have a combined 140 years Federal and State experience.
Has this situation happened to you?
You filed a joint tax return with your spouse and the entire refund was applied to my spouse’s back child support or back taxes. If so what do you do?
Most people think they should file a Form 8857, Request for Innocent Spouse Relief, to receive their portion of the refund. However, this is not the right thing to do. This issue is generally not related to Innocent Spouse Relief. You may be eligible for injured spouse provisions, Form 8379.
If you file a joint tax return and all or part of your portion of the overpayment was applied or offset to your spouse’s legally enforceable past-due federal tax, state income tax, child or spousal support, or a federal non tax debt such as a student loan, you should review the information on Injured Spouse and Form 8379 Injured Spouse Allocation.
There are different rules for innocent spouse relief. There are many questions clients ask us regarding the rules for Separated Liability. Hope this helps. What are the rules for Separation of Liability?
Under this type of relief, you divide (separate) the understatement of tax (plus interest and penalties) on your joint return between you and your spouse. The understatement of tax allocated to you is generally the amount of income and deductions attributable to your earnings and assets. To qualify for separate liability, you must have filed a joint return and met either of the following requirements at the time you file Form 8857: You are no longer married to, or are legally separated from, the spouse with whom you filed the joint return for which you are requesting relief. (Under this rule, you are no longer married if you are widowed.) You were not a member of the same household as the spouse with whom you filed the joint return at any time during the 12 month period ending on the date you file Form 8857. Why would a request for separate liability be denied?
Even if you meet the requirements listed above, a request for separate liability will not be granted in the following situations: The IRS proves that you and your spouse transferred assets for the main purpose of avoiding payment of tax. The IRS proves that at the time you signed your joint return, you had actual knowledge that any items giving rise to the deficiency and allocatable to your spouse were incorrectt. What Factors are considered in determining whether or not to grant equitable relief? The following factors may be considered, but the list is not all-inclusive:
Current marital status
Abuse experienced during the marriage
Reasonable belief of the requesting spouse, at the time he or she signed the return, that the tax was going to be paid; or in the case of an understatement,whether the requesting spouse had knowledge or reason to know of the understatement
Current financial hardship/inability to pay basic living expenses
Spouses’ legal obligation to pay the tax liability pursuant to a divorce decree or agreement to pay the liability
to whom the liability is attributable
Significant benefit received by the requesting spouse
Mental or physical health of the requesting spouse on the date the requesting spouse signed the return or at the time the requesting spouse requested the relief
Compliance with income tax laws following the taxable year or years to which the request for relief relates
Being involved with IRS work for the past 38 years, I have seen many tax returns forged by one spouse. It is almost becoming commonplace. What can the innocent or injured spouse do? There are two courses of action that can take place.
1. The innocent/injured spouse can turn the case over to the Criminal Investigation Division of the Internal Revenue Service. Contact the IRS Office closest to you and report the felony/spouse.
2. File Form 8857, Innocent Spouse Relief.
You may be eligible for relief, but relief does not fall under the innocent spouse rules. If you can establish your signature was forged, and there was not tacit (implied) consent, the joint election is invalid and you will only be liable for your separate tax liability.
Do you need a payment plan with the IRS? Call Fresh Start Tax today. 1-866-700-1040. If youowe less than $25,000 dollars and all your tax returns have been filed, we can get you a payment plan within one hour, guaranteed.
If youowe more than $25,000 we can get that payment agreement within days. Do not worry, we have successfully handled thousands of cases. The Information you will need so Fresh Start Tax can get an installment Agreement with the IRS:
If you received a bill from the IRS (balance due notice), you will need the following to apply online:
* Your Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN).
* Your Personal Identification Number (PIN), if already established. If you have not already established a PIN, you will need an IRS notice that displays your Caller Identification Number (Caller ID) in order to do so. If you do not have either you will need to call the IRS.
* When applying for a monthly payment plan, you may need additional information about your income and expenses to determine the amount of your monthly installment payment (rent or mortgage statements, pay stubs, utility bills, etc.). With this information, you can calculate a monthly payment that will fit into your budget. In some cases, OPA will provide a payment calculator to assist you in determining an appropriate payment amount. You will also need to select the day of the month you want your monthly payment to be due.
If you owe but have NOT yet received a bill from the IRS, you will need the following information to establish a pre-assessed agreement on current year returns:
The balance due shown on the return
Taxpayer identification number
Spouse’s taxpayer identification number (if applicable)
Date of birth
Adjusted Gross Income from last year’s income tax return
Total tax from last year’s income tax return
