This is when the IRS believes a taxpayer is not giving accurate information regarding his or her tax return. If you have any questions regarding tax audits or any tax liability issue seen on our site, don't hesitate...give us a call! Tax Resolution Specialists are standing by at (888) 532-0317.
A penalty or tax abatement can be defined as forgiveness of the penalties associated with tax debt that has been added on by the IRS over the course of the debt. In these cases, the IRS will agree to remove some of the assessed penalties and sometimes go as far as to revoke the extra charges altogether. Therefore, with the help of penalty abatements, which can also include property tax abatement and federal tax abatement, you can either be forgiven for the full tax penalty amount or part of the amount you owe. This can help to significantly lessen your financial burden.
Asset protection strategies consist of several methods to protect assets from liabilities arising elsewhere. It should not be confused with limiting liability, which concerns the ability to stop or constrain liability to the asset or activity from which it arises. Assets that are shielded from creditors by law are few. Common examples include some home equity, certain retirement plans and interests in LLCs and limited partnerships (and even these are not always unreachable). Assets that are generally unavailable are those not formally held in one's name. In many cases, it is possible to vest legal title to personal assets in a trust, an agent or a nominee, while retaining all the control of the assets. The goal of asset protection is similar to bankruptcy, but there are significant factors to be considered. When a debtor has few assets, bankruptcy may be the preferable option. When the debtor has significant assets, asset protection may be the solution.
The IRS can demand a tax debtor's employer send a portion of the tax debtor's wages directly to the IRS. Section 6334 does allow for an exempt amount that must remain outside of the levy. That amount, however, is relatively small, sometimes leaving the taxpayer with hardly enough to satisfy his or her regular living expenses.
Under United States Federal law, a Bank Levy is an administrative action utilized by the Internal Revenue Service (IRS) under statutory authority, without going to court, to seize property in order to satisfy a tax liability. The levy “includes the power of distraint and seizure by any means."  The general rule is that no court permission is required for the IRS to execute a section 6331 levy.  For taxpayers in serious debt to the IRS, the most feared weapon in the IRS arsenal is the tax levy. Using the powers granted to the IRS in the Internal Revenue Code, the IRS can levy upon wages, bank accounts, social security payments, accounts receivables, insurance proceeds, real property, and, in some cases, a personal residence. Under Internal Revenue Code section 6331, the Internal Revenue Service can “levy upon all property and rights to property” of a taxpayer who owes Federal Tax. The IRS can levy upon assets that are in the possession of the taxpayer, called a seizure, or it can levy upon assets in the possession of a third party, a bank, a brokerage house, etc. All future statutory references will be to the Internal Revenue Code unless noted otherwise.
IRS seizures are one method used to collect large amounts of back taxes which an individual has owed for many years. Quite often, the amount of the tax debt is much smaller than the total amount owed because of penalties and interest that are applied to any unpaid balances each year. These compile each year making the bill even larger. Although there are many ways the IRS can collect the money that is owed, seizures are a last resort and a very extreme measure they will, however, take. The IRS can seize almost all of your possessions without having to take you to court or get a judgement from a court. It is actually a very powerful tool in collecting taxes and one the majority of taxpayers fear most. If you are subject to a seizure, we know how to get you back on your feet.
Offer in Compromise
An offer in compromise (OIC) is an agreement between a taxpayer and the Internal Revenue Service that settles the taxpayer’s tax liabilities for less than the full amount owed. This program, in some cases, has provided tax debtors with up to a 90% savings on their tax liability.
Whether you call it an installment agreement, payment agreement, payment option or a payment plan, the idea is the same — you make payments on the tax you owe. That sounds like a good deal, but you can save money by paying the full amount you owe as quickly as possible to minimize the interest and penalties you’ll be charged. However, for those who cannot resolve their tax debt immediately, an installment agreement can be a reasonable payment option. Installment agreements allow for the full payment of the tax debt in smaller, more manageable amounts.
An Innocent Spouse agreement is something that can be arranged for the spouse of a tax debtor when they’ve sought out assistance with their tax debt. While a resolution is being made for the tax debtor, the spouse, who was uninvolved and had nothing to do with the debt, can be pardoned. This saves them from having their wages garnished or accounts levied, etc. If your spouse accrued a debt prior to your marriage, but you are now legally married, you will not be safe without this. Marital status is seen as two responsible parties in the eyes of the IRS.
Currently Non-Collectible Status
This program essentially provides the IRS with substantial proof that the debt is unlikely to be, or cannot be paid. CNC status can be very beneficial to a tax debtor that faces genuine financial hardships, and can typically stay in place until the Statute of Limitations has passed. Once this occurs, the IRS is forced to write off the debt and cannot collect.
This program is constructed for those who are looking to buy, sell, or refinance property. A Lien Subordination allows us to temporarily lift the lien from the property, allowing the transaction to be made. Liens cannot be officially removed until the debt is settled.
Trust Fund Penalty Defense
When a corporation has unpaid Form 941 liability (Employer’s Quarterly Federal Tax Return), the IRS may propose to assert the Trust Fund Recovery Penalty against the owners, officers, directors, shareholders or other persons. By taking this action, the IRS asserts the corporation’s liability against the people that run the business and will collect this liability from their personal assets. IRS collection efforts can include levies or garnishments on wages, levies on bank accounts and seizure of assets. The corporation provides no protection to individuals should the IRS choose to assert the Trust Fund Recovery Penalty against them. In determining whether to assert the Trust Fund Recovery Penalty against an individual, the IRS looks at various factors including, but not limited to, check signing authority, the position held within the company, the percentage of ownership, the amount of control one can exercise over decision-making authority, who signed the tax returns and who hired and fired employees. These factors are used to determine whether the Trust Fund Recovery Penalty should be asserted against the persons involved in the operation of the corporation. By asserting the Trust Fund Recovery Penalty against individuals, the IRS expands its collection potential to the people that run the business. The Trust Fund Recovery Penalty consists of all of the income tax that was withheld from employees’ wages and the employees’ share of FICA and Medicare. The Trust Fund portion of the Form 941 liability is typically around $.70 of every dollar but does not include penalties or interest.
A liability that has accrued when a tax payer has not filed tax returns happens when the IRS files SFR’s or “force file” for them. They file the return on the taxpayers’ behalf giving them zero deductions and placing them in the highest tax bracket. Most people would not file this way, and this causes large balances for every year an SFR is filed. We can help by amending these returns to be accurate, and, at times, wipe out the debt completely. In some cases, this action results in a return to the tax payer.