by Fresh Start Tax | Apr 17, 2012 | IRS Penalties, IRS Tax Advice, Tax Lawyer
Get rid of IRS Penalties and Interest 1-866-700-1040
Have IRS Insiders and Former IRS Agents work for you. If you have reasonable cause, we will get your money back, its that simple.
There are several ways to remove IRS Penalties and Interest. As Former IRS Agents and Managers we know all the techniques and best case practices to get rid of IRS Penalties and Interest.
Call us today at 1-866-700-1040 with your specific case and we will let you know the best way to abate, get rid of or remove IRS penalties and interest.
When it comes to filing your tax return, however, the law provides that the IRS can assess a penalty if you fail to file, fail to pay or both.
Failure to File, Failure to Pay:
Here are important points about the two different penalties you may face if you file or pay late.
1. If you do not file by the deadline or due date of the tax return, you will face a failure to file penalty.
If you do not pay by the due date, you could face a failure to pay penalty.
2. The failure-to-file penalty is generally more than the failure to pay penalty. So if you cannot pay all the taxes you owe, you should still file your tax return on time and pay as much as you can, then explore other payment options. Always file your tax return timely. This is the highest penalty the IRS assesses.
3. The penalty for filing late is usually 5 percent of the unpaid taxes for each month or part of a month that a return is late. This penalty will cannot exceed 25 percent of your unpaid taxes. It therefore tops out at 25%. Interest is assessed on penalties as well.
4. Exception – If you file your return more than 60 days after the due date or extended due date, the minimum penalty is the smaller of $135 or 100 percent of the unpaid tax.
5. If you do not pay your taxes by the due date, you will generally have to pay a failure to pay penalty of ½ of 1 percent of your unpaid taxes for each month or part of a month after the due date that the taxes are not paid.
This penalty can be as much as 25 percent of your unpaid taxes. This penalty also tops out as well.
6. If you request an extension of time to file by the tax deadline and you paid at least 90 percent of your actual tax liability by the original due date, you will not face a failure to pay penalty if the remaining balance is paid by the extended due date.
7. If both the failure to file penalty and the failure to pay penalty apply in any month, the 5 percent failure-to-file penalty is reduced by the failure-to-pay penalty.
However, if you file your return more than 60 days after the due date or extended due date, the minimum penalty is the smaller of $135 or 100 percent of the unpaid tax.
8. You will not have to pay a failure-to-file or failure-to-pay penalty if you can show that you failed to file or pay on time because of reasonable cause and not because of willful neglect.
See our website for a comprehensive list of reasonable causes for penalty abatement.
Call us today, 1-866-700-1040. On staff, Board Certified Tax Attorneys, CPA’s and Former IRS Agents.
by steve | May 2, 2011 | IRS Tax Advice, Tax News
Fresh Start Tax L.L.C. A Local Professional Tax Firm “A” Rated by the Better Business Bureau Since 1982
We have over 160 years of professional tax experience and over 60 years of working for the IRS in the local Florida IRS offices.
Need help with IRS Tax Debt Relief Help? Call a local professional tax firm. We are one of South Florida’s oldest, most trusted and experienced professional tax firms.
Have former IRS Agents, Managers and Instructors who taught IRS Tax Law to other IRS Agents work and settle your IRS tax Case. We get the very best results because we know all the IRS tax strategies.
Areas of Tax Practice:
- Immediate IRS Tax Representation
- Offers in Compromise/ IRS Tax Debt Settlement
- Immediate Release of Bank Garnishments or Wage Levies
- IRS Bill/Notice of “Intent to Levy” or Final Notices
- IRS Tax Audits Small and Large Dollar
- Hardships Cases / Unable to Pay
- Payment Plans, Installment Agreements
- Innocent Spouse Relief
- Abatement of Penalties and Interest
- State Sales Tax Cases
- Payroll/ Trust Fund Penalty Cases
How we work your case to immediately resolve your IRS problem and get you immediate and permanent tax relief:
1. We immediately send a power of attorney ( POA ) to the IRS letting them know we are now your tax representative. You will never speak to the IRS. We handle everything.
2. We will make sure your tax returns are filed and current. If your tax returns are not up to date, IRS will refuse to work your case. This is leverage that the IRS uses to get you compliant. Lost tax records, no problem. We can pull tax transcripts, file and prepare your tax returns within days.
3. IRS requires a current financial statement. We will secure a required 433-F (IRS financial statement), verify the income and expenses and work out a settlement agreement. IRS will require a closing settlement method for each case.
IRS Settlement Agreements/ Tax Debt Programs can be in different forms:
a. Hardship Settlements. Cases usually go into a 3 year suspended status because of an inability to pay. This is also called currently noncollectable. Your case will go into a hardship status because you do not have the income coming in to meet your current expenses. The IRS will use the National Standards Program to assess hardship.
b. Payment Agreements. Cases can be closed with agreed upon monthly installment payments to the IRS. We will review the different programs IRS uses to find you the lowest possible amount required.
c. Offer in Compromise /IRS Settlements / Tax Debt Settlement Programs. There are three types of OICs:
The IRS may accept an Offer in Compromise based on three grounds:
1. Doubt as to Collectibility – Doubt exists that the taxpayer could ever pay the full amount of tax liability owed within the remainder of the statutory period for collection.
2. Doubt as to Liability – A legitimate doubt exists that the assessed tax liability is correct. Possible reasons to submit a doubt as to liability offer include:
(1) the examiner made a mistake interpreting the law,
(2) the examiner failed to consider the taxpayer’s evidence or
(3) the taxpayer has new evidence.
3. Effective Tax Administration – There is no doubt that the tax is correct and there is potential to collect the full amount of the tax owed, but an exceptional circumstance exists that would allow the IRS to consider an OIC. To be eligible for compromise on this basis, a taxpayer must demonstrate that the collection of the tax would create an economic hardship or would be unfair and inequitable.
Call us for a free tax consultation. Free video conferencing is also available.
