by Fresh Start Tax | Nov 23, 2012 | Tax Relief, Tax Returns
B Notice IRS – IRS B Notice – Fresh Start Tax LLC, Former IRS – IRS Representation
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B Notice IRS – IRS B Notice
Government entities are subject to rules that require income tax withholding of 28% from certain payments if the payee is not exempt from backup withholding and fails to furnish correct taxpayer identification number (TIN).
The IRS does and may also notify a payer to begin backup withholding because of payee under reporting. The IRS computer system is set up systemically to handle this matters through self generating notices.
Failure to follow the backup withholding rules can result in penalties to the payer for filing incorrect information returns. IRS has the right to make the payer liable for any uncollected amounts. Both parties can be at risk.
Payments Subject to Backup Withholding
Rents,non-employee compensation for services, royalties, reportable gross proceeds paid to attorneys, and other fixed or determinable gains, profits, or income payments that are reportable on Form 1099-MISC, Miscellaneous Income.
Backup withholding does not apply to wages or pension payments.
Requirement for Payer To Secure a TIN
For all payees, you must make an initial solicitation for a TIN when the payee opens an account or when the transaction occurs.
You should use Form W-9, Request for Taxpayer Identification Number, to request the taxpayer identification number.
To beginning backup withholding on a payee, if the payee continues to fail to provide you with a TIN, you should generally make an annual solicitation of the payee for a TIN.
Missing Taxpayer Identification Number
A taxpayer identification number is considered “missing” whenever
1. the TIN is not provided,
2. the TIN has more or less than nine digits or
3. the TIN includes an alpha character in one or more of its nine positions.
The IRS Notice CP2100 or CP2100A Notice
CP2100 and CP2100A notices are notices that inform a payer that he or she may be responsible for backup withholding.
This may be due to missing or potentially incorrect taxpayer identification numbers identified during the processing of Form 1099 information returns.
It is accompanied by a listing of missing, incorrect, and/or not currently issued payee TIN. Large volume filers (250 or more erroneous documents) receive the CP2100 notice, while all other filers receive the CP2100A notice.
A Incorrect Taxpayer Identification Number
A taxpayer identification number is considered “incorrect” whenever the TIN is displayed in the proper format but:
1. the Name/TIN combination does not match, or
2. the TIN cannot be found in the files of the IRS and/or the Social Security Administration.
The famous “B” Notice
If the IRS sends you a CP2100 or CP2100A Notice indicating an incorrect payee TIN, you are required to send the “B” Notice within 15 days from the date you received it, or the date of the CP2100/2100A, whichever is later.
More can be found on IRS Publication 1281 for details.
You should begin backup withholding no later than 30 business days after the date of the CP2100 notice or the date you received it, whichever is later.
Stop backup withholding no later than 30 days after the payee furnishes a TIN and certifies that it is correct.
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B Notice IRS – IRS B Notice – Fresh Start Tax L.L.C.- Former IRS – IRS Representation
by Fresh Start Tax | Nov 17, 2012 | Representation, Tax Problem Help, Tax Relief
B Notice IRS Form 8822-B Fresh Start Tax LLC – Former IRS Agents – IRS Tax Help
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B Notice IRS Form 8822-B Fresh Start Tax L.L.C. – Former IRS Agents – IRS Tax Help
If you are moving or changing your address it is ALWAYS best to notify the IRS in every case. Many people or taxpayers feel just let IRS find me. Bad idea!
The problem with that thinking, according to the IRS code, the IRS is only required to send information to the last known address that they have on file from you.
If you do not notify the IRS, they can be sending you information for tax audits, tax changes and proposals to income and if you you do not respond you lose. There legal requirement is to the last known address.
Also , it is not the job of the IRS to keep up with you.
This IRS provisions clearly state it only has to contact you at your last filed tax return address.
Do yourself a huge favor, keep the IRS in the loop.
Purpose of Form
You can use Form 8822-B to notify the Internal Revenue Service if you changed your business mailing address or your business location.
Also, any organizations that change their address would file Form 8822-B, whether or not they are engaged in a trade or business. If you are a representative signing for the taxpayer, attach to Form 8822-B a copy of your power of attorney.
The use of this form is voluntary.
However, if you fail to provide the Internal Revenue Service with your current mailing address, you may not receive a notice of deficiency or a notice and demand for tax.
Despite the failure to receive such notices, penalties and interest will continue to accrue on the tax deficiencies.
You are not required to provide the information requested on a form that is subject to the Paperwork Reduction Act unless the form displays a valid OMB control number.
Books or records relating to a form or its instructions must be retained as long as their contents may become material in the administration of any Internal Revenue law.
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by Fresh Start Tax | Nov 15, 2012 | Income Tax Preparation, Tax Relief, Tax Returns
IRS Form, Letter, Notice 797 – Fresh Start Tax LLC, Former IRS
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IRS Letter 797
Deals with the possible Federal Tax Refund Due to the Earned Income Credit
What Is the EIC? ( Earned Income Credit )
The EIC is a refundable tax credit for certain workers.
Who May Claim the EIC?
A taxpayers may be able to claim the EIC for 2012 if you worked and all four of the following conditions apply.
1. You and or your spouse, if filing a joint return and have a valid social security number (SSN) issued by the Social Security Administration.
2. Your 2012 earned income and adjusted gross income are both under $36,920 ($42,130 if married filing jointly) if you have one qualifying child; under $41,952 ($47,162 if married filing jointly) if you have two qualifying children; under $45,060 ($50,270 if married filing jointly) if you have three or more qualifying children; or under $13,980 ($19,190 if married filing jointly) if you do not have a qualifying child. For a definition of earned income, see the 2012 instructions for Form 1040, 1040A, or 1040EZ.
3. Your filing status on your 2012 tax return is any status except married filing a separate return.
4. You were not a qualifying child of another taxpayer in 2012.
If you do not have a qualifying child, you must also meet these conditions.
a. You, or your spouse if filing a joint return, were at least age 25 but under age 65 at the end of 2012. (You meet this condition if you, or your spouse if filing a joint return, were born after December 31, 1947, and before January 2, 1988.) If your spouse died in 2012,
b. You cannot be claimed as a dependent on someone else’s 2012 tax return.
c. Your home, and your spouse’s if filing a joint return, was in the United States for over half of 2012.
If you are in the military ( first thank you ) on extended active duty outside the United States, your home is considered to be in the United States during that duty period and you may be able to claim the EIC.
You cannot claim EIC if any of the following conditions apply.
1. Your 2012 investment income (such as interest and
dividends) is over $3,200. See Pub. 596 for more information.
2. You file either Form 2555 or Form 2555-EZ (relating to foreign earned income).
3. You were a nonresident alien for any part of 2012 unless you
were married to a U.S. citizen or resident and elected to be taxed as
a resident alien for the entire year.
Who Is a Qualifying Child?
Any child who meets all four of the following conditions is a qualifying child.
1. The child is your son, daughter, stepchild, foster child, brother, sister, half brother, half sister, stepbrother, stepsister, or a descendant of any of them (for example, your grandchild, niece, or nephew).
An adopted child is always treated as your own child. An adopted child includes a child lawfully placed with you for legal adoption.
A foster child is any child placed with you by an authorized placement agency or by judgment, decree, or other order of any court of competent jurisdiction.
2. At the end of 2012, the child was under age 19 and younger than you (or your spouse, if filing jointly); or under age 24, a student, and younger than you (or your spouse, if filing jointly); or any age and permanently and totally disabled.
3. The child lived with you in the United States for over half of 2012. If the child did not live with you for the required time, there are exceptions if the child was born or died during the year, the child is presumed to have been kidnapped by someone who is not a family member, or there was a temporary absence.
4. The child does not file a joint income tax return for 2012.
There are additional rules if a child is married or is the qualifying child of more than one person.
For more details see the 2012 instructions for Form 1040, 1040A, or 1040EZ.
How Do You Claim the EIC?
If you are eligible to claim the EIC on your 2012 income tax return.
If you have a qualifying child, you must also fill in Schedule EIC and attach it to your Form 1040 or Form 1040A.
If eligible, you can claim the EIC to get a refund even if you have no tax withheld from your pay or owe no tax.
An example: if you had no tax withheld in 2012 and owe no tax but are eligible for a credit of $800, you must file a 2012 income tax return to get the $800 refund.
More Information
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by Fresh Start Tax | Nov 10, 2012 | Back Taxes, IRS Tax Advice, IRS Tax Problem, Tax Help, Tax Relief
Cannot Pay the IRS – Ask IRS for Tax Hardship or Noncollectable – IRS Tax Relief Today
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If you cannot pay the IRS you may be able to qualify for a Tax Hardship or a Noncollectable Status if you qualify. If your current expenses exceed your income you may have a chance to get your tax case suspended for a period of time.
Most of the cases that have past due balances over 4 months old, the IRS will not be able to collect in full at the current time.
The Internal Revenue Service has different programs in which taxpayers qualify to close their cases off of the IRS Collection enforcement Computer call the CADE 2.
There are at best guess over 25 million cases on the system that the IRS has made arrangements because the taxpayers do not have the ability to pay the tax in full. These back tax cases involve individual, payroll, excise, estate and a variety of other taxes.
From a common sense standpoint, all taxpayers cannot pay their tax obligations on time so the IRS has made other provisions to deal with back taxes.
The IRS will require a documented Financial statement. These financial statements are found on IRS form 433A or a 433F. When sent to the IRS they must include all attachments to prove the validity of the figures found on the form.
Besides this form the taxpayer will have to have all tax returns filed and current.
The three most common way taxpayers can close case once IRS reviews a current financial statement.
IRS will consider these closing methods:
1. Hardship, the inability to pay the tax off at the current time and unable to make monthly installment agreement due to a lack of income. The taxpayer qualifies for a Tax Hardship or Noncollectable Status.
2. Installment agreements,the taxpayer has the ability to make current monthly payments,
3. Offers in Compromise, the taxpayer has the ability to consider a tax settlement with the IRS.
What is a Economic Hardship
When a taxpayers liability can be collected in full but collection would create an economic hardship, an ETA offer based on economic hardship can be considered.
The definition of economic hardship as it applies to ETA offers is derived from Treasury Regulations § 301.6343-1.
A IRS Economic hardship occurs when a taxpayer is unable to pay reasonable basic living expenses.
The IRS determination of a reasonable amount for basic living expenses will be made by the Commissioner and the representatives and will vary according to the unique circumstances of the individual taxpayer.
Because economic hardship is defined as the inability to meet reasonable basic living expenses, it applies only to individuals (including sole proprietorship entities).
Tax Compromises on economic hardship grounds is not available to corporations, partnerships, or other non-individual entities.
The taxpayers financial information and special circumstances must be examined by the IRS to determine if they qualify for an ETA offer based on economic hardship.
The Financial analysis includes reviewing basic living expenses as well as other considerations.
The taxpayer’s income and basic living expenses must be considered to determine if the claim for economic hardship should be accepted. Basic living expenses are those expenses that provide for health, welfare, and production of income of the taxpayer and the taxpayer’s family.
There are national and local standard expense amounts are designed to provide accuracy and consistency in determining taxpayer’s basic living expenses.
These standards are guidelines and if it is determined that a standard amount is inadequate to provide for a specific taxpayer’s basic living expenses, allow a deviation.
In addition to the basic living expenses, other factors to consider that impact upon the taxpayers financial condition include:
a. the taxpayers age and employment status,education,
b. Number, age, and health of the taxpayers dependents,
c. Cost of living in the area the taxpayer resides, and
d. Any extraordinary circumstances such as special education expenses, a medical catastrophe, or natural disaster.
e. past history and income made over the past 3 years.
This list is not all-inclusive. Other factors may be considered in making an economic hardship determination.
Some factors that support an economic hardship determination may include:
1. 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.
2. 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.
3. 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.
Some of these factors are representative of situations the Service regularly encounters when working with taxpayers to resolve delinquent accounts.
They are not intended by the IRS to provide an exhaustive list of the types of cases that can be compromised based on economic hardship.
Call us today to find out more and speak directly to a tax professional. 1-866-700-1040
by Fresh Start Tax | Nov 9, 2012 | IRS Representation, IRS Tax Audit, IRS Tax Problem, Tax Help, Tax Relief
IRS TAX RELIEF – IRS TAX HELP
Stop your worry today. Have Former IRS who taught Tax Law at the IRS that know all the settlement and tax polices get you much needed tax relief.
We handle all IRS Collection matters, IRS tax audit, State Tax Problems and Appeals Issues. On staff, Board Certified Tax Attorney and CPA’s as well as Former IRS Agents, Managers and Instructors with over 60 years with the IRS.
We taught Tax Law at the IRS.
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Fresh Start Tax LLC – New Jersey
209 Cooper Ave,
Upper Montclair, NJ 07043
1-866-700-1040
Fresh Start Tax L.L.C. is one of the premier tax resolution firms in the New Jersey area.
Our firm deals with all types of civil cases including individuals, businesses, non-profits, partnerships and corporations.
We have staff that specialize in every facet of IRS Tax Representation and State Tax Representation.
We know all the IRS tax strategies because of our extensive IRS working backgrounds.
We were Former IRS Certified Tax Instructors that taught IRS Tax Law in the IRS Regional Training Center. Some of our many specialties include the following:
Areas of Professional Tax Practice:
- Same Day IRS Tax Representation
- Offers in Compromise or IRS Tax Debt Settlements
- Immediate Release of IRS Bank Levies or IRS Wage Garnishments
- Tax Relief from a IRS Bill, Letter or Notice of “Intent to Levy”
- IRS Tax Audits
- IRS Hardships Cases , Unable to Pay
- Payment Plans, Installment Agreements, Structured agreements
- Abatement of Penalties and Interest
- State Sales Tax Cases and Tax Audits
- Payroll / Trust Fund Penalty Cases / 6672
- Filing Late, Back, Unfiled Tax Returns
- Tax Return Reconstruction if Tax Records are lost or destroyed
- FBAR Experts
- Expatriate Tax Experts
Private Practice Since 1982
- Our staff has collectively over 205 years of Professional IRS Tax Representation Experience
- On staff, Board Certified Tax Attorney’s, IRS Tax Lawyers, Certified Public Accountants, Enrolled Agents,
- We taught Tax Law in the IRS Regional Training Center
- Former IRS Agents, Managers and Instructors with over 60 years experience in the local, district and regional IRS offices.
- Highest Rating by the Better Business Bureau “A”PLUS
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- Licensed and certified to practice in all 50 States
- Nationally Recognized Veteran /Published Former IRS Agent
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by Fresh Start Tax | Nov 8, 2012 | Expatriate Tax, FBAR, IRS Tax Problem, New Jersey Tax, Offshore Program, Offshore Tax Problems, Tax Lawyer, Tax Problem Help, Tax Relief
FBAR – Tax Attorneys, Lawyers, Former IRS – FBAR Specialists – New York, New Jersey – Civil & Criminal Representation 1-866-700-1040.
Fresh Start Tax LLC is a professional tax firm comprised of Board Certified Tax Attorneys, Tax Lawyer, CPA’s and Former IRS Agents and Managers.
Stop the worry today. We can get you in the system worry free.
We have over 206 years of professional tax experience and over 60 years with the Internal Revenue Service in the local, district and regional offices of the IRS.
We taught Tax Law at IRS as former Instructors. As a result we know all the policies and settlement procedures for all IRS cases.
You may contact us for a no consult 30 minute professional consultation, 1-866-700-1040.
FBAR
Without question you can expect the IRS and the DOJ to be coming down hard on Offshore and Overseas money that belongs in the coffers of the US government.
As IRS Commissioner Doug Shulman stated in his closing remarks as her is stepping down much of the focus in the past has been on FBAR and Expats due to the volumes of revenue it has generated from the enforcement of tax laws.
Here are the remarks from Shulman
“We view offshore tax evasion as an issue of fundamental fairness. Wealthy people who unlawfully hide their money offshore aren’t paying the taxes they owe, while schoolteachers, firefighters and other ordinary citizens who play by the rules are forced to pick up the slack and foot the bill.
Over the past five years, we have significantly increased our resources and focus on offshore tax evasion, and the results have been substantial. We upped the ante in a meaningful way with our work on Swiss financial institutions – where for the first time in history, a bank secrecy jurisdiction turned over thousands of names and account numbers.
As we increased our enforcement efforts and gained significant momentum, we gave taxpayers a chance to come in voluntarily and avoid going to jail. In a typical year, we used to get 100 or so taxpayers who used our voluntary disclosure program. When we first set up our new program in 2009, we thought that figure would rise to maybe 1,000.
So we are very pleased that we’ve had approximately 38,000 voluntary disclosures from individuals who came in under the special programs.
To date, these individuals have paid back taxes and stiff penalties amounting to more than $5.5 billion, and the number continues to grow. We are mining the information we have received and have launched our next wave of investigations on banks, bankers, intermediaries and taxpayers.
Collecting additional revenue for past misdeeds – as important as that may be – is not the only, or even primary, consideration here. It’s perhaps more important that we’re bringing U.S. taxpayers back into the system…back into compliance… so they properly report and pay their taxes for years to come. We have fundamentally changed the risk calculus of taxpayers who are thinking about hiding their money overseas, and we are well on our way to deterring the next generation of taxpayers from using hidden bank accounts to cheat on their taxes.
The inside skinny at the IRS FBAR, Expats
Under Obamacare the IRS is expecting to hire 15,000 new IRS agents. IRS is already launching new software and technologies to move in to the future regarding Offshore monies. Because of the huge success of this program a word to the wise, seek IRS before them seek you.
Each taxpayer has different options. We carefully review each case we receive and carefully plan the best remedy to fully and completely resolve your problem so do not fear cripple you.
We have successfully resolved thousands of taxpayers cases. Call us today to hear the truth and get results.1-866-700-1040.
