by Fresh Start Tax | Nov 28, 2018 | Tax Help
How Do You Know the Offer in Compromise is Right for You + Ask a Former IRS Agent
Michael Sullivan Fresh Start Tax Expert
I am a former IRS agent and teaching instructor with the Internal Revenue Service.
When I was employed by the Internal Revenue Service I work the offer in compromise program.
We are a local South Florida tax firm that had specializing in IRS tax debt settlement since 1982.
Not only did I accept and reject offers in compromise, I was also a teaching instructor at the service center to help qualified revenue officers decide which offers to accept and reject.
Given the above information, I can tell you I am a true expert for the IRS offer in compromise and I wish to explain to you whether an offer in compromise is a viable option for you.
Due to social media, marketing and advertising the assumption by the general public is that IRS can settle tax debt for pennies on the dollar.
Let me first let you know that IRS does accept offers in compromise and as a matter of fact last year approximately 32,000 offers in compromise were accepted out of the 78,000 that were filed.
The average settlement was $9500 per case but remember that is just an average in not everybody can settle their tax debt for $9500.
There is much information you need to know before you go off filing an offer of compromise and giving your money to some firm to try to pull off some amazing trick because you have been sold a bill of goods and bought in to some marketing ploy and they’ve convinced you are a settlement candidate.
It first starts with the review of your personal financial statement which is found on the 433 OIC.
When the offer in compromise gets sent in to the Internal Revenue Service it is met with the reviewer that make sure that you are truly qualified candidate for the offer in compromise program. That reviewer checks the completed form to make sure it is a valid agreement. The offer in compromise is a legal document between you and the Internal Revenue Service.
Also reviewer make sure that all the documentation is attached so that the revenue officer who will work your offer in compromise can move forward.
Approximately one third of all offers in compromise are sent back to the taxpayer because the offers are not filled out correctly or the appropriate documentation is not attached.
IRS will check to make sure all your tax returns are current and filed on the IRS system.It is critically important you know that you must have all tax returns filed before IRS will process your offer.
You should know that the Internal Revenue Service rejects an offer before it accepts an offer. one of the basic rules is that the revenue officer is lazy and is easier to mark rejected then they go through all the work of accepting an offer in compromise. I should know this is a former instructor of the offer in compromise I see many are revenue officers simply send offers back because some of the eyes were not dotted in the tees were not crossed.
Due to the volume of cases the IRS has, which is over 7500 cases waiting in the IRS Q, is far easier for the IRS to say no then to accept because an average of anywhere between 20 and 40 hours are spent on accepting the offer in compromise. If you have an offer in compromise accepted, four signatures are generally required for signature as it goes up and down the chain.
So how do you know if the offer in compromise is right for you. Call for a free initial tax consultation and hear the truth from a true IRS tax debt settlement former agent.
The first place to go is to fill out the IRS pre-qualifier tool for the offer in compromise. Because of so many scrupulous tax companies that have been ripping people off, the IRS wanted to make sure the general public has a tool that they can use to find out if they are prequalified to file the offer in compromise to make sure it is a viable option.
It contains all the necessary information in regard to your income, your expenses and your assets and it predetermined for you whether the offer in compromise is even a viable option for you.
IRS will take a very close look at the liquidity of your assets, your current income, and your monthly expenses before it renders a decision as IRS wants to make sure it collects all the money from you that they can within the 10 year statutory period of time.
One of the questions the agent will want to consider is, can we collect more money over 10 years than accept the current agreement on the table for the IRS offer in compromise.
As a general rule, you will have to give IRS your total liquidity of all your assets before they will even consider the acceptance of an offer in compromise.
IRS on larger dollar cases is a tremendous amount of due diligence.
Why? you may ask is because all offers in compromise are open for public inspections at eight regional offices throughout the United States.
Your offer in compromise must be thoroughly documented which includes all your bank statements for the last six months to a year, all your pay stubs, all your monthly expenses along with certain documentation for assets that have value.
IRS also takes a look at the values of your pensions, your IRA, your business as well.
The offer in compromise is one of the most reviewed documents, it is like going through a mini audit.
Some of the due diligence that IRS will conduct on a larger dollar cases is checking Google, the accurate search engine, Department of Motor Vehicles, real estate records, insurance policies, credit reports, loan applications, insurance policies, and inter-government agency records including those garnered by Homeland security and other such agencies.
Before you contemplate filing the offer in compromise and wasting your money on a company that has promised you they can settle your case for pennies on the dollar, you would be wise to give us a call to have an actual former IRS agent and teaching instructor of the offer in compromise give you the green light.
When you call our office you will speak to true IRS tax experts who knows the system and can tell you what to expect and tell you how to settle for the lowest amount possible.
Call us today for a free initial tax consultation, you will hear nothing but the truth from former IRS agents who know and understand the methodologies of the offer in compromise to make sure it is right for you.
How Do You Know the Offer in Compromise is Right for You + Former IRS Agent Can Help + Ft. Lauderdale, Miami, Palm Beaches, Boca Raton, Pompano Beach
by Fresh Start Tax | Oct 17, 2018 | Tax Help
We are a local South Florida tax firm that has been practicing since 1982. We are The Affordable Tax Experts.
We worked out of the local South Florida IRS offices and we are true specialists and experts in helping you resolve your IRS problem.
Being former IRS agents we know the truth about tax resolution.
Not only were we former IRS agents, managers and teaching instructors, we also taught new IRS agents their jobs so it only makes sense that we know the system inside and out.
One call to our firm and we can tell you how to solve your IRS problem the different programs available by IRS. Yes, it only takes one call.
Since 1982 we have resolved thousands of cases by telling taxpayers the truth about the tax resolution industry.
Members of our team are former IRS agents and managers who have over 206 years of professional tax experience and over 100 years of working directly for the Internal Revenue Service.
We are the true tax experts, we have worked thousands of cases.
Being former IRS agents gives us a unique advantage over the competition because we know every system, every strategy and every methodology that IRS can employ.
Good results do not happen by accident good results come by working thousands of cases and having years of experience.
The general myth that is in the public today is that you can settle for pennies on the dollar.
While that is true you must be a true qualified candidate for the IRS offer in compromise program to settle back tax debt.
So here is the process to determine how you can dispose of an IRS tax debt.
First and foremost the IRS will require a current financial statement and that is generally on a form 433F or 433A depending on where your cases in the IRS system. You can download the forms on our website.
IRS will expect that financial statement to be documented fully including bank statements, pay stubs, copy of all expenses and any other document that applies in your particular situation.
The Internal Revenue Service conducts a mini audit on your financial statement.
Since IRS spends so much time reviewing your case using the financial statement we understand the system to put you in the best spotlight with IRS.
We spend a lot of time reviewing your financial statement and making adjustments were possible to get you the best result.
Full compliance check. A full compliance check is a must when dealing with the Internal Revenue Service.
It is of utmost importance for you to know that the Internal Revenue Service will conduct a full compliance check which means that Internal Revenue Service will make sure all your tax returns are filed, up to date, and you are currently are making estimate payments or have sufficient withholding being taken out in the year you call IRS so you will not incur a problem again.
IRS does not like repeat and habitual offenders.
Tax Return Status. You must file all tax returns
If you have back tax returns that you need to file to get current to comply with the IRS requirements we can have our former IRS agents who know every single tax law option to ensure that you will pay the lowest amount by law file your returns and get them on official record .
Many people say, well I don’t have sufficient records to prepare my tax returns? We can help so don’t be afraid.
That is not a problem for us, we can pull back IRS transcripts to find out what your income for the past six years and we can reconstruct your tax return based on IRS reconstructive methods and still ensure you pay the lowest amount by law. IRS will expect the last six years of tax returns be filed.
If you have not filed your back tax your call us today and we will walk you through the process of getting right with IRS. We have never had a tax return prepared by our firm audited by the Internal Revenue Service to date.
Options to close out a tax debt case. Owing back federal and state taxes.
1 . You can pay the tax liability in full and if you need a couple of weeks or a couple of months IRS will entertain that and allow you time enough to cut them a check.
As a general rule we file a power of attorney, speak to the Internal Revenue Service and let them know of the full payment date. Many times the Internal Revenue Service will not file a federal tax lien.
2. You can make a payment plan or installment plan.
There are various payment plan options available and when you call our office we will review your current financial statement and walk you through the various programs the internal revenue has to pay them.
Approximately 6.5 million taxpayers a year sign up for an IRS payment plan or installment agreement. IRS has various types of installment arrangements.
Payment plans are based on your current financial statement and your ability to pay. IRS will also take an online payment if you meet and fit the criteria.
3. Your case can be put in a currently not collectible or hardship.
If you have more expenses and income and you live the means test of the national standard program , IRS can temporarily suspend your case. That suspension could last one to three years. IRS will re-review the case in a period of time. The downside to this program is that penalties and interest still run, the upside is that IRS is off your back for a period in season of time.
Approximately 40% of all open cases and the IRS collection queue are currently in a hardship or not collectible.
4. You can file a bankruptcy to help stop and delay IRS.
As a general rule chapter 7, Chapter 11, and Chapter 13 may apply to certain cases. We can review those options with you.
5. The statute of limitations.
IRS has 10 years to collect back taxes from the day your taxes as assessed. The day your taxes assessed means the day IRS puts your tax return onto their computer system for the first time. The general statute of limitations runs 10 years from that date of assessment. There are actions that extend the statute of limitations such as filing of a collection due process, bankruptcy, or litigation and there are other factors.
6. The offer in compromise.
IRS has a very specific procedure to settle your debt for pennies on the dollar.
When you call our office we will let you know after review of your current financial statement whether you can settle your debt for pennies on the dollar through the offer in compromise program.
Approximately 70,000 offers are files each year and 32,000 are accepted for settlement of $9500.
There is a pre-qualifier tool for the offer in compromise. you can either walk to the pre-qualifier tool by yourself or have us review your current case and let you know if you have the ability to settle your debt through this federal IRS tax relief program.
When you use our company you will never have to talk to IRS.
We handle all communication we treat you with dignity respect and most of our clients become more friends.
If you are having a problem paying your back tax debt you can call our office and speak to true IRS tax experts you have over 200 years of direct professional work experience and over 100 years working at Internal Revenue Service.
When you call our office you will speak to true IRS tax experts who have worked thousands of cases.
Solve Your IRS Tax Problems Today, Find Out the Truth About Tax Resolution + Ft. Lauderdale, Miami, Boca Raton, Palm Beaches, Miramar, Pembroke Pines
by Fresh Start Tax | Dec 1, 2012 | IRS Notice or Letter, Tax Help, Uncategorized
IRS Notice, Letter CP 503 – Affordable, Former IRS, Tax Solutions, Settlements, Hardships – Fresh Start Tax LLC
Fresh Start Tax LLC is a IRS tax specialty firm. Since 1982, the principles of Fresh Start Tax LLC have been successfully resolving IRS tax issues and problems. We are the Affordable Firm.
You have options so do not panic.
All tax consultations are free. You will speak directly to a true tax professional.
We have over 60 years of direct IRS work experience and over 205 years of total tax experience.
We taught Tax Law at the IRS.
The IRS Notice and Letter CP- 503
The IRS Notice or Letter is the third letter or notice that the IRS CADE 2 computer system generates to a taxpayer. all letters and notices are sent out on a 5 week billing cycles.
It is the last friendly notice that the IRS sends to taxpayers, after this it gets nasty, real nasty.
You can stop the IRS with one call.
The very next Notice or Letter after the CP 503 sent out 5 weeks later is an Intent to Seize. That seizure is in the form of a IRS Bank Levy or a IRS Wage Garnishment.
At this point you have different settlement options.
You can have Fresh Start Tax LLC contact the IRS and get your case closed in one of the following ways:
1. A Hardship, unable to pay the tax at this time because of financial conditions in your life,
2. The filing of a settlement agreement called the offer in compromise.
3. A payment plan or payment agreement,
IRS will require a IRS financial statement that you can find on our website. The IRS will review the financial statement and the documentation to verify the statement and will negotiate with us a means of settlement.
We can get you results you are looking for. Call us today and stop the worry.
Our 205 years of experience can get you results. 1-866-700-1040.
What the CP 503 will look like.
Notice CP503, Page 1
Notice CP503, Page 2
IRS Notice, Letter CP 503 – Affordable, Former IRS, Tax Solutions, Settlements, Hardships – Fresh Start Tax LLC
by Fresh Start Tax | Nov 27, 2012 | IRS Notice or Letter
IRS Tax Notice, Letter 3164A,B,C, DO – IRS Tax Help – Tax Solutions – Former IRS
If you have received a IRS Letter or Notice 3164 call us today to find out more. 1-866-700-1040.
We are comprised of Tax Attorneys, Tax Lawyers, CPA’s, and Former IRS Agents, and Managers.
IRS has the right and ability to find out information from third parties as you will read below. These letters are usually used by IRS Revenue Officers when working a field investigation.
This letters and or notices are used for discovery purposes.
You should actively be contacting the IRS and trying to resolve this tax issue at hand. do not bury your head in the sand. Call us to learn more.
You should be aware that is there is an active investigation and a IRS Agents is currently working the file.
Advance Notification Requirements
There are three versions of Letter 3164 available for use by Collection employees.
Letter 3164 A (DO) for Trust Fund Recovery Penalty (TFRP) investigations.
Letter 3164 B (DO) for balance due investigations.
Letter 3164 C (DO) for delinquent return investigations.
Letter(s) 3164 should not be used for the purpose of initiating taxpayer contacts. Letter(s) 3164 should also not be routinely mailed/hand delivered upon receipt of a new case.
Overview
This IRM provides guidelines on revenue officer contact with third parties in the determination of a tax liability or collection of a tax liability.
The provisions of IRC §6103 and corresponding regulations apply to all third party contacts.
For third party contacts made for the purpose of collecting or determining a tax liability, IRC §7602(c) requires the IRS to:
1. Provide advance notice to the taxpayer that third party contacts may be made,
2. Periodically provide a list of all third party contacts to the taxpayer, and
Provide a list of third party contacts to the taxpayer upon request.
Any tax period under investigation by Criminal Investigation (CI) is not subject to the requirements of IRC §7602(c). A criminal investigation is initiated when an administrative referral based on a firm indication of fraud is made to CI.
Third-party contacts to develop a referral are contacts under IRC §7602(c).
Third Party Contacts
For purposes of IRC §7602(c), a third party contact has been made when an IRS employee initiates contact with a person other than the taxpayer and asks questions about a specific taxpayer with respect to that taxpayer’s Federal tax liability, including the issuance of a levy or summons to someone other than the taxpayer.
Generally, an IRS employee will identify himself or herself when attempting to obtain information from third parties. In situations where an IRS employee attempts to reach a taxpayer by telephone, but instead reaches someone other than the taxpayer:
If the appropriate Letter 3164 or Publication 1 ( Pub 1), Your Rights as a Taxpayer, version dated 05/2005 has been sent and the requisite waiting period has lapsed, the employee may seek additional information.
If the appropriate Letter 3164 or Pub 1 has not been sent and the requisite waiting period has not lapsed, the employee may not seek additional information nor should the employee identify himself or herself unless expressly asked.
IRS Tax Notice, Letter 3164-A B,C DO – IRS Tax Help – Tax Solutions – Former IRS
by Fresh Start Tax | Sep 26, 2012 | Offer in Compromise, Tax Help
IRS accepts 27% of all offers in compromise filed.
Last year that accounted for 14,000 plus offers being accepted by the IRS. An Offer in Compromise a IRS tax settlement.
Being a Former IRS Agent and teaching Instructor I have seen taxpayers struggle needlessly for years in an effort to settle their tax bills with the IRS. The old system was broke and the truth of the matter, the old Offer in Compromise Program was completely broke and was in need of much improvement.
It was almost impossible to get an Offer in Compromise through the IRS because the system was to hard, to complicated, unachievable the general attitude of the IRS by the Agents to the program was to simply reject offers in compromise.
Finally IRS stepped up to the plate and completely revamped the program and now the question remains, will IRS follow through and accept offers under the new Fresh Start Program. The changes made are huge. I firmly believe if the IRS follows up with its press releases and administers the program like it is fashioned out, the taxpayers can breathe again and be free of the bondage which they have be held captive too.
The New Fresh Start Program, the affordable tax settlement process:
The Internal Revenue Service announced another expansion of its “Fresh Start” initiative by offering more flexible terms to its Offer in Compromise (OIC) program that will enable some of the most financially distressed taxpayers to clear up their tax problems and in many cases more quickly and affordable than in the past and this is welcome news.
The new Fresh Start Program focuses on the financial analysis used to determine which taxpayers qualify for an OIC. This announcement also enables some taxpayers to resolve their tax problems in as little as one to two years compared to four or five years in the past.
Changes to the program include:
- Revising the calculation for the taxpayer’s future income.
- Allowing taxpayers to repay their student loans.
- Allowing taxpayers to pay state and local delinquent taxes.
- Expanding the Allowable Living Expense allowance category and amount.
What is a Offer in Compromise? – Doubt as to Collectibility
In general, an OIC is an agreement between a taxpayer and the IRS that settles the taxpayer’s tax liabilities for less than the full amount owed. An OIC is generally not accepted if the IRS believes the liability can be paid in full as a lump sum or a through payment agreement. There are two other offer programs not mentioned in this blog. Call us for more details, 1-866-700-1040.
The IRS looks at the taxpayer’s income and assets to make a determination of the taxpayer’s reasonable collection potential. OICs are subject to acceptance on legal requirements. To get the Offer to acceptance process is both lengthy and a bit complicated.
The IRS recognizes that many taxpayers are still struggling to pay their bills so the agency has been working to put in place common-sense changes to the OIC program to more closely reflect real-world situations. IRS finally got the picture.
When the IRS calculates a taxpayer’s reasonable collection potential, it will now look at only one year of future income for offers paid in five or fewer months, down from four years, and two years of future income for offers paid in six to 24 months, down from five years. All offers must be fully paid within 24 months of the date the offer is accepted.
Other changes to the OIC program include narrowed parameters and clarification of when a dissipated asset will be included in the calculation of reasonable collection potential. In addition, equity in income producing assets generally will not be included in the calculation of reasonable collection potential for on-going businesses.
Changes to the Allowable Living Expenses Section
The Allowable Living Expense standards are used in cases requiring financial analysis to determine a taxpayer’s ability to pay. The standard allowances provide consistency and fairness in collection determinations by incorporating average expenditures for basic necessities for citizens in similar geographic areas. These standards are used when evaluating installment agreement and offer in compromise requests.
Changes to The National Standard Section
The National Standard miscellaneous allowance has been expanded to include additional items. Taxpayers can use the miscellaneous allowance for expenses such as credit card payments and bank fees and charges.
Changes to The Miscellaneous Section
Guidance has also been clarified to allow payments for loans guaranteed by the federal government for the taxpayer’s post-high school education. In addition, payments for delinquent state and local taxes may be allowed based on percentage basis of tax owed to the state and IRS.
Offers in Compromise, New Tax Settlement Program ,Fresh Start Tax, Affordable Tax Solutions
