by steve | Oct 6, 2009 | Tax Help, Uncategorized
This is a question we are often asked. Tax planning on your case becomes a key issue and knowing how long the lien is good for is critical.
How long is a Federal Tax Lien good for?
A Federal Tax Lien continues until the liability for the amount that is assessed against you is satisfied in full. The Federal Tax Lien could also become unenforceable because of a lapse in time. The collection period expires ten years from the original date of the assessment
Can the ten year period of time be extended by law?
Yes it can.
- How long is a Federal Tax Lien good for?
The statute of limitations was extended at the same time an installment agreement was entered into. In this case, collection action may be taken until the 89th day after expiration of the installment agreement. IRC § 6502(a)(2)(A). You want to make sure IRS does not extend the statue of limitations on your case
- Or if a release of a levy under IRC § 6343 is accompanied by an agreement to extend the statute of limitations to a specific date and that date has not yet passed. IRC § 6502(a)(2)(B); Treas. Reg. § 301.6343-1(b)(2)(ii)(D).
Other reasons that exist common to these cases is that the taxpayer has been outside the United States for a continuum of 6 months or a bankruptcy has been filed. These also extends the statue of limitations. There are a few other reason though rare.
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by steve | Oct 5, 2009 | Tax Help, Uncategorized
The IRS is trying to help certain situations for taxpayers who need to refinance but the federal tax lien has hurt their chances. The IRS is aware of these situations and are trying to help. Please read the following from the Internal Revenue Service and our comments.
The IRS needs to ensure that we balance our responsibility to enforce the law with the economic realities facing many American citizens today. In a small but potentially important way for some families, the IRS is trying very hard to help. The IRS will make it easier for financially distressed homeowners to avoid having a federal tax lien block refinancing of mortgages or the sale of a home. For taxpayers who are trying to refinance their mortgage, the existence of a tax lien generally means that the new lender will not go through with the refinancing. But in a lot of cases, the IRS will decide to make the federal tax lien secondary to another lien, such as a new mortgage.
The IRS is ready to help taxpayers who find themselves in these situations. Where we can subordinate our lien to help a family win that new refinance mortgage, that may mean that they can stay in their homes. Some taxpayers are also trying to sell their homes. Often, they have no equity in the home because it has gone down in value. Again, the tax lien makes it unlikely that a new buyer could get a mortgage on the property. In these cases, we can discharge the tax lien so that the sale can proceed.
I want to stress that the IRS is doing whatever it can under the constraints of the law and common sense to avoid getting in the way of people trying to save or sell their homes. It currently takes about thirty days to apply for and receive either a discharge or a subordination of a federal tax lien. The IRS is committed to putting in place whatever resources are needed to speed this process up as much as possible, so that we will not be the party delaying a closing or a settlement. So, the question is, will this help a lot of families? I’m not in a position to predict how many families this will affect or how many families will take advantage of these new, expedited IRS procedures, but I can say that there are more than a million federal tax liens outstanding today, tied to both real and personal property.
Let me just give you a little more information on how it works. A taxpayer or their representative, such as their lender, may request that the IRS make a tax lien secondary to the lien by a lending institution that is refinancing or restructuring a loan. A taxpayer may also request that the IRS discharge its claim if the home is being sold for less than the amount of the mortgage lien in some cases.
Taxpayers can find all the information they need at www.irs.gov. You know, I think the main message and what we want to let people know is that, as commissioner, I’ve given instructions to all IRS personnel to work with taxpayers on any mortgage-related issue. We’ve shifted resources to expedite our subordination process. We’re gonna go the extra mile ’cause we’re very sensitive that this is an important issue the taxpayers are gonna be working through in these difficult economic times.
Even though the IRS has had this procedure in place for many years, the process is longer than they lead you on to believe and the procedure is longer than you think. Generally there are only 2 staff people working these cases in a district. We have the speed and the contact to help navigate you through this process. We have the necessary forms to expedite you through process and get you relief as soon as possible.
by steve | Oct 5, 2009 | Tax Help, Uncategorized
Millions of taxpayers in the United States do not file tax returns. At some point you will have have to make the decision and pony up. Whether it is guilt or by force, sooner or later the IRS is going to come looking for you. After years of representing taxpayers, the reasons vary, but those who fail to file suppress the filing of income tax returns for a multitude of different reasons. Most of the time it seems to happen very innocently and like a snowball rolling down a hill it gets bigger and bigger and the problem becomes huge. Millions fall into this category. Most individuals do not know what to do and keep being on the lamb because they simply do not understand how easy it is to get back into the system. The guilt , the stress and the fear eat into their very lives. Usually during tax season, they see all the ads, which drives their stress level higher and higher and generally they get relief after tax season just because the commercials are over. Are you one of those individuals frozen because you do not know what to do? Delinquent returns and back taxes can eat the very life from you.
We can help you get back into the system and close your case to boot. So, how does this happen? Lets look at this from an IRS point of view. The IRS for various reasons has not caught up with you as yet. You may ask, how does this happen? Well, the IRS services the entire tax system in our country and there are certain holes that exist in the system. At some point though, the system will find you. Many times, taxpayers move or become self employed and that can drop the taxpayer off the system for a season in time. The IRS computer system will eventually catch up with you. The IRS actually knows you have not filed, but have not had the time or people power to run you down just yet. If someone at the IRS actually pulled up your social security number, they would see you have not filed. Due to the volume of taxpayers they process through the system, temporary cracks exists. Temporary is the key word. However, IRS wants you back into the system and they will ask for your delinquent returns and they will find out of your tax status. The IRS usually picks up these cases when a 1099 match or a W-2 match is made on a cross check. There is no tax return match to the W-2 or 1099 or other matched documents, so out goes a notice for delinquent returns or a back tax notice. Those are fearful letters to receive. The bottom line, 99.9% of the time, IRS just wants the returns and put you back into the system. The goal and mission of IRS is for everyone to be fully compliant into a voluntary tax system.
Over the years we have helped thousands and thousands of taxpayers get back into the system. So how do we help? First thing that must be done is to secure a power of attorney making us your tax representative. This makes the IRS only talk with us and we also have a client privilege relationship. You speak to only us and we speak to IRS. We answer all the questions. I cannot tell you how valuable this is. We know what to say and how to answer any questions. The next step is to secure all unfiled tax returns or back taxes and get you current. We may file anywhere from 3, 6, or 7 years worth of back taxes or delinquent returns. Sometimes these are known as failure to file returns. The next step is to secure a financial statement and develop a settlement strategy. So, we not only file the tax returns, but find an end means to resolve your case so you can move forward and reduce the stress in your life.
At the end of the day, we contact the IRS, prepare back returns or delinquent returns, talk with IRS and settle your case with them. We are a full service company. Use us and see for yourself.
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by steve | Oct 2, 2009 | Tax Help, Uncategorized
What happens if the IRS finds me before I file?
This is one of the top ten questions we are asked. If the IRS finds you before you file, find a representative that knows their way through and around the system. Most of the time the IRS wants you current to get back into their system. They will immediately check to make sure you are current so the problem is stopped. Next thing that the IRS will do is determine how many back years they want filed. At the same time, they will secure a current financial statement to determine how fast they can collect the money and find out where your assets are. It is critical you hire a professional to become involved with this process to help navigate you through the process. There is some financial planning that can be done to limit your damage.
by steve | Oct 2, 2009 | Tax Help, Uncategorized
How many tax returns should I file if I have not filed in years? This varies on a case by case basis and the majority of time you will get different answers depending on who you ask. The type of case you have has a lot to do with the answer. In some cases, the IRS will ask for 7 years because they keep their income sources for 7 years on their own internal systems. It is easy to pull up and they can send their source report to you within days. In other cases they may ask for 3 to 6 years. A lot of this also has to do with the asset base of the taxpayer. The IRS is trying to determine how much they can collect based on the assets you have. So if it behooves the IRS to go back 7 years because of collection potential, they will go back that far.
So, it is a case by case basis. A professional should be involved with helping you make these decisions. It should be known that if there is criminal activity, these rules do not apply.
by steve | Oct 2, 2009 | Tax Help, Uncategorized
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The Taxpayer Advocate Service is an independent organization within the IRS whose employees assist taxpayers who are experiencing economic harm, who are seeking help in resolving problems with the IRS, or who believe that an IRS system or procedure is not working as it should. Here are seven things every taxpayer should know about TAS and it does work, sometimes.
1. TAS is your voice at the IRS.
2. The service is free, confidential, and tailored to meet your need, so says the IRS.
3. You may be eligible for TAS help if you have tried to resolve your tax problem through normal IRS channels and have gotten nowhere, or you believe an IRS procedure just isn’t working as it should be. Be careful to rile the troops. Make sure you have a case first.
4. TAS helps taxpayers whose problems are causing financial difficulty or significant cost, including the cost of professional representation. This includes businesses as well as individuals. You need to know what you are doing to have a chance because generally only a professional can help you when you are at this point.
5. TAS employees know the IRS and how to navigate it. But the employees still work for IRS. That is why an experienced professional is needed to help. They will listen to your problem, help you understand what needs to be done to resolve it, and stay with you every step of the way until your problem is resolved.
6. TAS has at least one local taxpayer advocate in every state, the District of Columbia, and Puerto Rico. You can call your local advocate, whose number is in your phone book, in Publication 1546, Taxpayer Advocate Service.
7. You can learn about your rights and responsibilities as a taxpayer by visiting the online tax toolkit at www.taxtoolkit.irs.gov.
Most of the time, a matter of fact, almost all times, if the case is in the local IRS office and a decision is made prior to going to taxpayer advocate, IRS advocate office will uphold the decision of the local agent. |
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