by Fresh Start Tax | Oct 23, 2018 | Tax Help
If you owe a chunk of change to IRS you have options. Former IRS agents can help get rid of the IRS and stop the calls.
There are various means of paying back taxes to IRS. As former IRS agents we will explain your options. A tax settlement may be in your future.
As a former IRS agent and teaching instructor with IRS you should know as a general rule someone with more experience will work your IRS collection case.
That person will have a lot of experience looking for assets and more carefully evaluating your current financial statement.
Your current financial statement holds the key to tax negotiation with the Internal Revenue Service.
Success comes by knowing the system and understanding what it takes to close an IRS case.
IRS takes a closer look at all cases large dollar especially the financial statements, the IRS is looking for the ability of the taxpayer to pay the back tax. As a former IRS agent this was part of my job.
One of the first tasks of IRS is to make sure all back tax returns are filed and current in the system.
IRS will not close out any open taxpayer inventory case unless all back tax returns are filed and the taxpayer is current on estimated tax payments or their withholding is up-to-date.
IRS is a stickler on this because they don’t want the problem of the back tax debt recurring.
So how will IRS work your case?
The Internal Revenue Service will ask the taxpayer to fill out an IRS form 433A.
You can find that on our site or on the government site. IRS will expect that form to be fully completed fully documented along with copies of the last six months bank statements, copies of all monthly expenditures, bills and a copy of pay stubs.
IRS will conduct a thorough review on that financial statement.
The internal revenue service can go through great lengths to do due diligence on your case. They have many search engines at their disposal. They will check Department of motor vehicle, records public records, credit reports, insurance policies and a plethora of other information found on internal systems used by different federal and state government agencies.
IRS knows much more about you than you can possibly imagine. You must make sure you still out your financial statement truthfully and accurately. That’s why it is best a true tax professional provide the necessary tax help to resolve your problem.
After this review of the financial statement the Internal Revenue Service generally has various buckets of closing programs that the taxpayer can be put into as a result of their current financial statement.
The importance of filling out your financial statement and giving it to IRS is the key to success and failure. I could never tell you how important the financial statement as it will determine the outcome with Internal Revenue Service.
Bucket One.
Currently uncollectible or hardship cases
If the Internal Revenue Service looks at your current financial statement and determines that your expenses exceed your income and you fall within the necessary means test, IRS can place your case in this non-collectible status.
There is good news and bad news within the status.
The good news is IRS will probably suspend your case between one and three years and kick it out for review a couple of years later, the bad news is the penalties and interest still run and the debt gets larger.
Bucket Two.
Installment agreements or monthly payments
If after the Internal Revenue Service looks at your current financial statement and they determine that you have more income than the necessary standards of meeting tests, IRS will ask for a monthly payment based on that financial statement. Hiring a tax professional can assure that IRS does not grab more money than necessary on or review of your financial statement. There are different monthly installment agreements and we will review with you your options upon your free consultation.
Bucket Three.
Offer in Compromise
This is called the pennies on a dollar program that you see advertised on TV however the offer in compromise is not for everyone.
I am a former IRS agent and teacher of the offer in compromise.
Approximately 32,000 taxpayers a year can settle their debt for pennies on the dollar, the average settlement is $9500 a year and I caution and warn taxpayers who submit offers in compromise to go through the IRS pre-qualifier tool to find out if they can truly settle their tax debt.
As a former IRS agent I carefully will walk through your financial statement and if you have any chance of being accepted for the offer I will walk you through the program and submit the offer in compromise.
Bucket Four.
Statute of limitations
IRS has 10 years to collect on their back tax debt, the period starts from the date of the assessment. The date of the assessment is the time that IRS had to put your case on the computer at the start the billing process. Various factors will extend the statute such as bankruptcy, the filing of the CDP, or the filing of offer but as a general rule after the 10 year date of assessment date your case goes away by federal statute,
Bucket Five
Bankruptcy.
Yes, Bankruptcy, many taxpayers are unaware that you could file a bankruptcy, a chapter 7 the discharge debt.
As a general rule the taxes have to be three years or older, assessed for more than 240 days and the tax returns have to be filed for at least two years. there are also different chapters in bankruptcy such as an 11 and 13 that a taxpayer can be qualified by speaking to a true bankruptcy expert.
When you call our office we will walk you through the various programs after review of your current financial statement.
Call us for a free initial tax consultation and we will walk you through the process of dealing with the Internal Revenue Service.
Do You Owe IRS a Chunk Of Change in Back Taxes + IRS Tax Help Is Right Here + Former IRS
by Fresh Start Tax | Oct 23, 2018 | Tax Help
We are national tax debt experts for those who owe federal payroll tax debt. We are the fast, friendly and affordable tax firm that has been servicing the nation since 1982.
Our office has over 200 years of total IRS work experience and we are true experts and how to settle your federal payroll tax debt with Internal Revenue Service.
IRS experts in this matter.
We are available for free initial tax consultation. We are the fast friendly and affordable tax firm.
I am a former IRS Agent and teaching instructor of the Offer Program when formerly employed at the IRS.
We know all the systems, settlement formulas and all the methodology to get you affordable IRS tax debt relief including trust fund debt problem.
We should be able to make sure we can reach a reasonable settlement on your payroll tax liability and you can continue to operate your business without fear and worry from the Internal Revenue Service.
Please keep in mind the Internal Revenue Service will conduct a full compliance check to make sure not only your business, company or corporation is current but also your individual taxes are up-to-date.
IRS does not want to seize your business for back taxes due on payroll taxes, however 941 payroll taxes are a big concern for the IRS.
You my ask why payroll tax that is a big concern for IRS, it simply because those are trust fund taxes that is money held in trust and is not an imposition to collect taxes from a company, it’s simply returning to IRS what you have withheld from employees and matched their Social Security.
IRS has an FTD program which is called the federal tax deposit alert which warns local offices of companies that are failing to file federal tax deposits. As a former IRS agent I worked this program.
Just be advised that IRS does keep a task force available on large companies that are making federal tax deposits.
The Process of receiving a Payroll Tax Debt Settlement
The Internal Revenue Service will want to fully review your company or corporation before you can obtain in IRS payroll tax settlement.
You will need to provide IRS with the current financial statement along with proof that all payroll tax deposits and 941 tax forms have been filed.
Many times IRS will want a personal or individual financial statement for more responsible persons. For most company’s of the IRS payroll tax settlement may come in three forms.
After IRS reviews your current financial statement the Internal Revenue Service may determine that you are a hardship candidate, monthly payment agreement candidate or an offer in compromise candidate and IRS payroll settlement.
Why have Fresh Start Tax contact the IRS:
You never have to talk with the Internal Revenue Service on these tax matters;
Fresh Start Tax knows what the IRS is looking for;
Fresh Start Tax knows the exact packaging required;
Fresh Start Tax knows the next steps the IRS will take;
You know your case will be handled and resolved as fast as possible.
Other Factors To Consider
IRS has the right to sell your complete inventory at public auction;
IRS can seize all your accounts receivables;
IRS can hold you personally responsible for this tax;
IRS has the right to lock the doors of your business.
Steps to take to work out an affordable payment plan with the Internal Revenue Service:
Immediately stay current on all payroll tax deposits to show the IRS good faith;
Be prepared to give the IRS a current financial statement;
Make sure your personal tax liabilities are filed and paid;
Have all documentation on the financial statement prepared for the IRS.
If you do not pay your Payroll Taxes IRS can collect them from you individually
To encourage prompt payment of withheld income and employment taxes, including social security taxes, railroad retirement taxes, or collected excise taxes, Congress passed a law that provides for the TFRP.( trust fund recovery penalty )
These payroll taxes are called trust fund taxes because you actually hold the employee’s money in trust until you make a federal tax deposit in that amount.
The TFRP may apply to you if these unpaid trust fund taxes cannot be immediately collected from the business.
The business does not have to have stopped operating in order for the TFRP to be assessed
BE CAREFUL Who can be Responsible for the TFRP
The TFRP may be assessed against any person who:
Is responsible for collecting or paying withheld income and employment taxes, or for paying collected excise taxes, and
Willfully fails to collect or pay them.
A responsible person is a person or group of people who has the duty to perform and the power to direct the collecting, accounting, and paying of trust fund taxes. This person may be:
An officer or an employee of a corporation,
A member or employee of a partnership,
A corporate director or shareholder,
A member of a board of trustees of a nonprofit organization,
Another person with authority and control over funds to direct their disbursement,
Another corporation or third-party payer,
Payroll Service Providers (PSP) ore responsible parties within a PSP
Professional Employer Organizations (PEO) or responsible parties within a PEO, or
Responsible parties within the common law employer (client of PSP/PEO).
For wilfulness to exist, the responsible person:
Must have been, or should have been, aware of the outstanding taxes and either intentionally disregarded the law or was plainly indifferent to its requirements (no evil intent or bad motive is required).
Using available funds to pay other creditors when the business is unable to pay the employment taxes is an indication of willfulness. You will be asked to complete an interview in order to determine the full scope of your duties and responsibilities.
Responsibility is based on whether an individual exercised independent judgment with respect to the financial affairs of the business.
An employee is not a responsible person if the employee’s function was solely to pay the bills as directed by a superior, rather than to determine which creditors would or would not be paid.
Figuring the Trust Fund Amount
The amount of the penalty is equal to the unpaid balance of the trust fund tax. The penalty is computed based on:
The unpaid income taxes withheld, plus
The employee’s portion of the withheld FICA taxes. For collected taxes, the penalty is based on the unpaid amount of collected excise taxes.
Assessing the TFRP. If the IRS determines that you are a responsible person, we will provide you a letter stating that we plan to assess the TFRP against you. You have 60 days (75 days if this letter is addressed to you outside the United States) from the date of this letter to appeal our proposal.
The letter will explain your appeal rights. Refer to Publication 5, Your Appeal Rights and How to Prepare a Protest if You Don’t Agree (PDF), for a clear outline of the appeals process. If you do not respond to our letter, we will assess the penalty against you and send you a Notice and Demand for Payment.
Once we assert the penalty, the IRS can take collection action against your personal assets. For instance, we can file a federal tax lien or take levy or seizure action.
Owe Federal Payroll Taxes, How IRS Will Handle You Tax Debt + Former IRS Agents Know Settlements, Back Tax Debt
by Fresh Start Tax | Oct 18, 2018 | Tax Help
Does the IRS want in your pocket to collect a chunk of change, We can Help, We can Stop the IRS NOW!
As a former IRS agent and teaching instructor with IRS , more attention is given to taxpayers who owe larger dollars to the IRS.
IRS takes a closer look at all cases large dollar especially the financial statements, the IRS is looking for the ability of the taxpayer to pay the back tax. As a former IRS agent this was part of my job.
One of the first tasks of IRS is to make sure all back tax returns are filed and current in the system.
IRS will not close out any open taxpayer inventory case unless all back tax returns are filed and the taxpayer is current on estimated tax payments or their withholding is up-to-date.
IRS is a stickler on this because they don’t want the problem of the back tax debt recurring.
So how will IRS work your case?
The Internal Revenue Service will ask the taxpayer to fill out an IRS form 433A.
You can find that on our site or on the government site. IRS will expect that form to be fully completed fully documented along with copies of the last six months bank statements, copies of all monthly expenditures, bills and a copy of pay stubs.
IRS will conduct a thorough review on that financial statement.
After this review of the financial statement the Internal Revenue Service generally has various buckets of closing programs that the taxpayer can be put into as a result of their current financial statement.
The importance of filling out your financial statement and giving it to IRS is the key to success and failure. I could never tell you how important the financial statement as it will determine outcome with Internal Revenue Service.
Bucket One.
Currently uncollectible or hardship cases
If the Internal Revenue Service looks at your current financial statement and determines that your expenses exceed your income and you fall within the necessary means test, IRS can place your case in this non-collectible status.
There is good news and bad news within the status.
The good news is IRS will probably suspend your case between one and three years and kick it out for review a couple of years later, the bad news is the penalties and interest still run and the debt gets larger.
Bucket Two.
Installment agreements or monthly payments
If after the Internal Revenue Service looks at your current financial statement and they determine that you have more income than the necessary standards of meeting tests, IRS will ask for a monthly payment based on that financial statement. Hiring a tax professional can assure that IRS does not grab more money than necessary on or review of your financial statement. There are different monthly installment agreements and we will review with you your options upon your free consultation.
Bucket Three.
Offer in compromise
This is called the pennies on a dollar program that you see advertised on TV however the offer in compromise is not for everyone.
I am a former IRS agent and teacher of the offer in compromise.
Approximately 32,000 taxpayers a year can settle their debt for pennies on the dollar, the average settlement is $9500 a year and I caution and warn taxpayers who submit offers in compromise to go through the IRS pre-qualifier tool to find out if they can truly settle their tax debt.
As a former IRS agent I carefully will walk through your financial statement and if you have any chance of being accepted for the offer I will walk you through the program and submit the offer in compromise.
Bucket Four.
Statute of limitations
IRS has 10 years to collect on their back tax debt, the period starts from the date of the assessment. The date of the assessment is the time that IRS had to put your case on the computer at the start the billing process. Various factors will extend the statute such as bankruptcy, the filing of the CDP, or the filing of offer but as a general rule after the 10 year date of assessment date your case goes away by federal statute,
Bucket Five
Bankruptcy.
Yes, Bankruptcy, many taxpayers are unaware that you could file a bankruptcy, a chapter 7 the discharge debt. As a general rule the taxes have to be three years or older, assessed for more than 240 days and the tax returns have to be filed for at least two years. there are also different chapters in bankruptcy such as an 11 and 13 that a taxpayer can be qualified by speaking to a true bankruptcy expert.
When you call our office we will walk you through the various programs after review of your current financial statement.
Please keep in mind that you owe over $50,000 the IRS spends a little more time in research in looking at your case.
Many agents will Google your company business or individual self, they will pull up search engine reports to find out about assets or financial histories, check out insurance policies, courthouse records, and credit reports, before they make a determination.
The credit card companies are an excellent source to run down assets, loans and find out monthly payments that you were making.
Call us for a free initial tax consultation and we will walk you through the process of dealing with the Internal Revenue Service.
Owe A Chunk Of Change to IRS On Back Taxes + Fast Solutions + Ft. Lauderdale, Miami, Boca Raton, Pompano Beach
by Fresh Start Tax | Oct 11, 2018 | Tax Help
We are a local South Florida tax firm that specializes in IRS tax debt relief. Since 1982 we have worked thousands of cases and nobody matches our experience. we are A+ rated.
We have worked thousands of cases since 1982 through every level of the Internal Revenue Service. We have worked in almost every single position in IRS collection and audit.
Since 1982, we have been resolving IRS tax issues and we have an amazing history of successful client work and satisfied customers and that is due to the experience we have in dealing with IRS tax problems and tax issues and IRS tax relief.
NOBODY MATCHES OUR IRS EXPERIENCE, NOBODY!
On staff are former IRS agents, managers and teaching instructors who were supervisors and managers while working at the Internal Revenue Service. We have a whole team of professional experts that work at our firm. Your case is assigned to the tax expert that has the greatest area of expertise.
As a result of all of our work experience, we understand the methodologies and all the procedures to close IRS cases in the most prudent and affordable manner. True IRS tax resolution should be handled by experienced veterans who work thousands of cases.
Upon your initial consultation in almost all cases, we will let you know how your tax case will resolve itself and exactly how much it will cost you.
Each case has its own unique set of circumstances so we will customize a specific plan of action based on your set of circumstances and financial matters. There are no two cases alike. Usually what is meant by unique set of circumstances are the financial conditions that exist of the time of negotiation with the Internal Revenue Service.
You will never have to speak to Internal Revenue Service we will handle all communication with you to you and with the Internal Revenue Service.
The most popular program is the IRS offer in compromise because it settles your debt for pennies on the dollar but you must be sure you qualify for this type of settlement or you will waste your money.
People such as you have given thousands of dollars to companies promising the settlements but there are qualifiers that the taxpayer must be aware of before they throw their money at somebody. When you call most companies a salesperson picks up the phone but fresh start tax will have a true IRS tax expert talk to you about your situation.
As a former IRS agent in teaching and structure of the offer in compromise I can let you know well ahead of time whether your offer will have any chance of acceptance and will be able settle your debt for the lowest allowable amount allowed by law if you qualify. Whatever you do do not be fooled by other companies.
When you call other tax settlement companies you are usually speaking to a salesperson who doesn’t know beans about offers in compromise what is trying to upsell you on the settlement.
Offers in Compromise, the OIC, this is known as the pennies on a dollar program.
I am a former IRS agent and teaching instructor of the offer in compromise or tax debt settlement program along with other IRS programs and systems.
We have over 60 years of direct work experience in the local, district, and regional tax offices of the Internal Revenue Service. We are true IRS experts who understand the IRS collection system.
All our work is done in-house and we are used by other firms to do their backend work.
You can call us today for free initial tax consultation and find out if you are a true offer in compromise tax debt settlement candidate.
Due to the IRS new fresh start initiative set out by the Internal Revenue Service many more taxpayers are eligible for the tax debt settlement.
Before a taxpayer or client thinks about the filing of an offer in compromise they should check out the IRS offer in compromise pre-qualifier tool first.
You can walk to the pre-qualifier tool on our site or call us today to learn more about it. The pre-qualifier tool has been put there by Internal Revenue Service to make sure you are not ripped off by tax settlement companies.
We will not file an offer in compromise or accept any fee for any client unless we know they are qualified for the program.
So if we send in your offer in compromise, you probably do have a pretty good chance of getting it accepted.
It is important to know you will that all back tax returns will have to be filed, up-to-date and current on the IRS computer system before the Internal Revenue Service will accept an offer in compromise.
IRS Tax Statistics for the OIC.
Last year there were 78,000 offers in compromise were filed with the Internal Revenue Service, 38% of those were accepted for an average of $6500 per case. Keep in mind this is a national average and varies from case to case is completely dependent on your current financial statement.
Also keep in mind your offer may be worked by any person throughout the United States.
About 20% of all offers in compromise go to the Appellate Division for settlement. Many times your best settlements occur when your case goes to the appellate division for review and the person needs to settle your case.
You should know that not everyone is an offer in compromise candidate to settle their tax debt.
There are many companies out there today advertising pennies on the dollar and if you are not a true qualified candidate you should not be giving your money to any firm.
The advice I give everyone is to speak to the person who is working your case and let them explain why you are a qualified candidate for the offer in compromise.
Make sure you are eligible for the OIC. Do not give your money to any company firm or otherwise until you know you are a qualified candidate.
Before 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. When you are in a bankruptcy proceeding IRS literally freezes all activity on your account.
Submitting your offer or OIC to the Internal Revenue Service.
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:
• Form 433-A (OIC) (individuals) or 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;
• $186 application fee (non-refundable); and
• Initial payment (non-refundable) for each Form 656.
Keep in mind IRS will process no offer in compromise until all documents are in the sent file.
Selecting a payment option for the offer in compromise program
Your initial payment will vary based on your offer and the payment option you choose:
• IRS 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.
• IRS 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, you must continue to pay monthly until it is paid in full.
While your offer in compromise 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);
• A Notice of Federal Tax Lien may be filed;
• Other collection activities are suspended;
• The legal assessment and collection period is extended;
• Make all required payments associated with your offer;
• You are not required to make payments on an existing installment agreement; and
• Your offer is automatically accepted if the IRS does not make a determination within two years of the IRS receipt date. This very rarely happens but from time to time you get lucky and win the lottery.
Other: IRS tax relief programs
Many taxpayers for a variety of reasons cannot qualify for an offer in compromise and IRS has four other buckets of ways they close cases once they were open in the IRS collection
They are as followed:
Hardship, payment agreement, statute of expiration, bankruptcy.
1. For those who are financially strapped and qualify, IRS has a currently non-collectible program in which taxpayers who qualify IRS will temporarily suspend their case between one and three years and then kick the case out later and re-review the financial statement.
Approximately 40% of all people who are in the current IRS collection Q wind up in a temporarily non-collectible file.
2. While other people based on their current financial statement can make a payment arrangement with the Internal Revenue Service. Approximately 6.5 billion people wind up in payment agreements because of their current financial statement. The Internal Revenue Service will use the national standard test to make sure the agreement is fair and reasonable.
3. Others qualify because the statute of limitation has expired on their tax assessments. As a general rule IRS has approximately 10 years to collect all cases. we can pull IRS tax transcripts to find out how close you are to having your statute of limitations expired.
4. While others can file Chapter 7 bankruptcy proceeding. We were review with you each of the criteria when you call us.
Tax Return Note:
As a side note, taxpayers should be aware that all tax returns must be filed before they can have an approved offer in compromise. Before IRS will work an offer in compromise to settle your tax debt they will want all tax returns filed and they will want to make sure you are current on your ES payments or your withholding in the current year we are in.
If you submitted an offer in compromise and IRS finds your tax returns are not file they will return the offer to you.
We could prepare all back returns for you with little or no records. Please keep in mind that IRS can file your tax returns under 6020 B of the Internal Revenue Code.
The Internal Revenue Service keeps records for six years of all income source documents which means IRS has all your W-2s and 1099 s.
As former IRS agents we know the system and understand all the protocols to get you the very best result possible.
Our founder has been on FOX Business news as well as NBC. Mr. Sullivan is also contributed to Bloomberg news as well as the Wall Street Journal.
Best Tax Settlement Company + IRS Tax Debt Relief + Ft.Lauderdale, Miami, Palm Beaches, Boca Raton, Pembroke Pines, Miramar
by Fresh Start Tax | Oct 10, 2018 | Tax Help
Being a former IRS agent and teaching instructor of the offer in compromise there are so many myths about the program it’s hard to keep up with.
MYTH
The majority of calls that I get or from taxpayers that believe that IRS is going to settle their tax debt because of the ads they see on TV the Internet and various marketing techniques.
While the offer in compromise is a true program offered by the Internal Revenue Service, approximately 32,000 Americans get their offers in compromise approved by Internal Revenue Service because they are true qualified candidates for the program. The majority do not get accepted.
The average settlement is $6500 per case in approximately 32% of all offers in compromise are accepted by the Internal Revenue Service.
Unfortunately there are many IRS debt settlement companies that take cases, make promises and their clients offer have no chance of going through the IRS system to settle their tax debt.
Many of these companies charge thousands of dollars and I hear all the stories as people call me after other companies have failed to perform. I warn any taxpayer who wants to hire a company to speak to the person who will be working their case before giving their money to any IRS debt settlement company. You should find out how many offers they have worked and get a gut feeling about what you think their level of expertise is. I would also suggest that you speak to somebody who’s worked for the Internal Revenue Service and knows the program inside and out.
Everybody should know that the Internal Revenue Service has an offer and compromise pre-qualifier tool and if they do not call a professional company they should walk through the pre-qualifier tool on IRS.gov.
So how does the offer in compromise get process through the Internal Revenue Service.
First of all, a reviewer looks at the offer to make sure the offer can be referred to a revenue officer. The offer in compromise must from a technical standpoint be filled out completely have all signatures and all key elements of the 656 in place.
The reviewer then pulls up a transcript to make sure all the tax returns have been filed. If the offer in compromise is not filled out correctly all tax returns not filed, the reviewer sends it back to the taxpayer.
Once it passes the test of the reviewer, the offer is then passed on to a revenue officer specialist who has been trained by the Internal Revenue Service what to look for and what can be accepted by the Department of treasury.
KEEP IN MIND
The offer in compromise is a binding contract or covenant between the Department of treasury and the taxpayer and is a true legal settlement and document.
Once the revenue officer who is the offer in compromise specialist looks at the financial statement that person will get a general sense of how they feel about the offer in compromise.
A good tax tip
Put a letter or an accompaniment document letting the reviewer know from the beginning why your client or taxpayer needs to have this offer accepted and any extenuating circumstances that may exist.
BIG TIP
It puts a idea in the mind of the revenue officer of the desperate situation that the taxpayer is going through. The reason this is important is that the revenue officer is only looking at a piece of paper is removed from the reality of the taxpayer.
The job of a true practitioner is to help your client.
So you must make the situation real to the Internal Revenue Service as to understand the effects of the burden of the tax liability.
As a former IRS agent revenue officer I would look at the offer, glanced through, it look at the numbers, look at the written statement and kinda have a feeling about the offer in compromise. It is very important for that initial review to ge well, the IRS offer specialist feel good about working the offer in compromise, it sets the tone.
Please keep in mind it is much easier for a revenue officer offer in compromise specialist to reject the offer in compromise because there is a lot of process work and due diligence that a person must do to accept the offer in compromise.
Not only do you as a revenue officer have to approve the offer but so does your manager, the regional manager and so does the district council of Internal Revenue Service for legal purposes.
Many people ask why this process is so extensive and why so much time is spent.
The answer is quite simple, all offers in compromise that are accepted by the Internal Revenue Service are open to public review for one year at certain regional tax offices so the public can review offers in compromise and see which cases IRS accepts and which cases they do not.
So you can expect the Internal Revenue Service to be very cautious and more importantly use the same standard to accept every single offer in compromise. Appearance is very important to the Internal Revenue Service
Once the revenue officer starts looking at the financial statement they pay a lot of time to three main things:
1. the assets,
2. the income, and,
3. the expenses claimed by the taxpayer.
ASSETS.
The revenue officer wants to make sure that they’re getting their full liquidated value as part of the basis for settlement to Internal Revenue Service.
IRS will discount your residence approximately 20% but IRS generally will never settle for less than full liquidation value of the assets of any taxpayer and/or business.
Also keep in mind assets includes IRAs, pensions, stocks, and values of businesses that the taxpayer may own.
Next the revenue officer will move on to the expenses claimed against income.
The revenue officer will compare the national, regional, and geographical standards of the cost-of-living are in every region of the United States and compare that to the income.
The IRS’s job is to make sure that the taxpayer is living well within their means before they will accept an offer in compromise.
The goal of the Internal Revenue Service is to make sure the taxpayer has to borrow money from third-party to pay the offer in compromise and to settle their tax debt. Any money in possession of the taxpayer in any savings account or checking account generally must be included in the offer in compromise.
( please keep in mind that exceptions exist in certain cases.)
Once the revenue officer is pretty certain that this is a doable or acceptable offer, it puts the offer through a series of financial tests to make sure the documentation on the financial statement is correct.
The IRS agent will spend approximately 20 to 40 hours to work an offer in compromise.
The Agent will do Google searches to check businesses and an individual’s name to find out if there are assets, it will use the accurate search engine to look for back assets, it will pull DMV records, pull courthouse records, and will use other search engines to make sure that this offer can be acceptable by the Internal Revenue Service.’s
One of the great sources that IRS can use is a credit report.
There is a plethora of information on a credit report and on large cases the revenue officer can and will pull a credit report up.
After the revenue officer is convinced this is a doable offer they will package up the case and send it to the manager for review and acceptance .
What to Do if the Offer is not accepted.
In almost all cases we send an appeal and to get it to a third party who is not connected with the collection division.
We love the sender cases to and appellate officer who was a better and more balanced person to accept the offer in compromise.
If you have any question about your case or like us to review your offer in compromise or process it call us today for a free initial tax consultation.
You will hear the truth about the offer in compromise.
While there is so much more that I could write and can be included in this short blog these are the basic overviews of the IRS offer in compromise.
Please keep in mind I was a former IRS revenue officer teacher and instructor of the offer in compromise.
