Resolution Archives - Page 9 of 13 - Professional Tax Resolution

Category Archives: Resolution

Tax Lien and Tax Levy Facts – The Expert Advice You Need

Posted on by

What is a Tax Lien?
A tax lien is a claim against one or more of a taxpayer’s assets. It is issued by the IRS or State Tax Agency for the purpose of insuring payment of a tax debt. The tax lien gives the issuing tax agency priority over other potential creditors with respect to the assets identified by the lien. A tax lien is one of the more aggressive steps in the enforced collection process and is usually issued when all other previous attempts to collect a tax debt have been ignored.

How Does a Tax Lien Differ From a Tax Levy?
While the tax lien is a claim against a taxpayer’s property, a levy is the actual seizure of that property. The levy is one of the final steps in the enforced collection process and is used only when a taxpayer has made no attempt to resolve an existing tax liability. Once a Final Notice of Intent to Levy has been issued together with an official notice informing the taxpayer of their right to a formal hearing, the property identified by the levy can be confiscated without further notification.

Under What Conditions Can a Tax Lien Be Withdrawn?
A tax lien can be withdrawn if it was not filed according to established IRS policies and procedures or if it will delay the collection of the tax debt in question. It can also be withdrawn if the taxpayer enters into an installment agreement to repay the debt identified by the lien or if it can be established that withdrawing the lien is in the best interest of the taxpayer.

When is a Tax Lien Released?
A tax lien is released when the tax debt identified by the lien is paid in full. It will also be released if the taxpayer enters into a formal agreement with the issuing tax agency for partial payment of the existing liability. These resolution options include, but are not limited to, an Offer in Compromise or a Partial Payment Installment Agreement. Once the tax debt is paid in full or one of the partial payment settlement plans has been accepted, the taxpayer must submit a formal written request that the lien be removed. Within 30 days of receiving such a request, IRS will issue a Certificate of Release.

What are the Recent Changes to Tax Lien Guidelines?
• The threshold for issuing a tax lien has been raised from $5,000 to $10,000.
• A lien will now be released once a taxpayer has entered into a direct debit installment agreement but after a probationary period to insure that the direct debit agreement is in place and working as planned.
• The qualifying criteria for an Offer in Compromise have been revised to include a larger group of taxpayers. The tax debt ceiling has been raised from $25,000 to $50,000 and the maximum annual income allowed has been increased to $100,000.

If you are the subject of a tax lien or any other type of collection activity by the IRS or State Tax Agency, our experienced professionals can help you stop the action and resolve the tax debt issue that caused it. For more information about our tax debt resolution services, visit us today at www.professionaltaxresolution.com. Contact us by phone at (877) 889-6527 or by email at info@protaxres.com to receive a free, no obligation consultation

IRS to Fingerprint Tax Preparers and Require PTIN to be Renewed Yearly.

Posted on by

We have many clients who come to us with huge tax debts that have resulted from errors or miscalculations on prior year returns. Sometimes these tax filing errors flag an audit or create what might start off as a small tax liability but after years of penalties and interest becomes a much bigger problem. Of course, we wish no one had to experience this in the first place but unfortunately until now there has been some leniency in the educational and documentation requirements for some tax preparers.

Luckily Uncle Sam also wants to be sure that whomever you trust to prepare your taxes also understands the increasingly complex tax code. While CPA’s like those at our firm have extensive licensure oversight, continuing education and years of experience, not all general tax preparers do. To overcome this, the IRS has just announced they are taking steps to begin fingerprinting all tax preparers and are stepping up educational requirements.

In addition to acting as proper Identification, the fingerprints will also be run through the FBI database. This will help identify any unscrupulous characters. Perhaps even more importantly is the new obligation for tax preparers to renew their Preparer Tax Identification Numbers (PTIN) every year in accordance with Notice 2011-80 and undergo a 15-hour continuing education requirement. All of this is set to take effect next year.

Up until now, the IRS had been issuing provisional PTIN for preparers who are not attorneys, CPA’s, accountants or enrolled agents. That former flexibility allowed others to prepare tax returns before taking competency tests and undergoing suitability requirements. This was partially because the testing and continuing education programs had not been implemented yet, but as of next year, this will finally be the case.

Before you hire anyone, we recommend checking their licensure and checking with the Better Business Bureau. Read reviews and understand the details of any services for which you are hiring.

At Professional Tax Resolution Inc. our CPA’s and EA’s are proud of our reputation. We welcome you to look up our license and review our A rating with the BBB. We have links to a variety of unbiased review sites including Yelp, The BBB, and Merchant Circle readily available on our home page.

Call us today for a free, no obligation consultation. No matter how worried you are, no tax issue is too complex! (949) 596-4143 or toll free (877)-889-6527

Tax Levy – Understanding and Resolving IRS and State Tax Levies

Posted on by

Do you have or know someone with a tax levy? A tax levy is serious, it is the actual seizure of a taxpayer’s property by either the IRS or a State Tax Agency. It is one of the final steps in the enforced collection process and is usually exercised only after all previous attempts to collect a tax debt have failed.

A tax levy is different from a tax lien. The lien simply gives the issuing tax agency priority over other creditors with respect to the identified property while the levy actually results in the confiscation of the property.

The IRS must officially warn a taxpayer before assets are seized to satisfy an existing tax debt. The first official notice to go out is the Notice of Tax Due and Demand for Payment. If the delinquent taxpayer fails to respond to this notice, it will be followed by the Final Notice of Intent to Levy together with an official notice informing the taxpayer of their right to a hearing. Once this official communication process has been completed, the IRS can seize the identified assets without further notification.

With certain exceptions, the IRS can levy any physical asset held by a taxpayer. They can also levy retirement accounts, bank accounts, dividends, wages, insurance policies and numerous other assets that may be the property of the taxpayer but held by someone else. One notable exception to the list of assets that are subject to the levy process is the taxpayer’s principal residence. The taxpayer’s residence can never be seized to satisfy a tax debt of $5000 or less and can only be confiscated to cover a debt in excess of $5000 with written approval of the federal district court judge or magistrate. In addition, property (other than rental property) that is used as a residence by another person cannot be seized to satisfy a tax liability of less than $5000. Similarly, real or tangible property used in a taxpayer’s trade or business cannot be levied without written approval of an IRS director. Other categories of physical property exempt from an IRS levy include wearing apparel, school books and furniture and personal effects up to a fixed dollar amount. Certain types of payments are also exempt. This list includes workers’ compensation, unemployment benefits, some annuity and pension payments, certain types of Social Security, disability and welfare payments, judgments in support of minor children and certain amounts of wages and other income.

The IRS is a very powerful collection agency and an IRS Levy is one of its most aggressive actions. A taxpayer who receives and IRS Notice of Tax Due and Demand for Payment or an IRS Notice of Intent to Levy should realize that enforced collection action is imminent. At this point, the most effective response is probably to enlist the help of a qualified tax resolution specialist. An individual who understands tax law and has experience working with the IRS may be able to stop impending collection activity. There is also the chance that a tax professional will be able to reduce the tax liability that resulted in the collection action or eliminate it altogether.

If you are the target of a tax levy or any other type of aggressive collection activity by the IRS or State Tax Agency, our experienced tax professionals can help you forestall the action and resolve the tax debt issue that caused it. For more information about our tax debt resolution services, visit us today at www.professionaltaxresolution.com. Contact us by phone at (949)-596-4143 or by email at info@protaxres.com to receive a free, no obligation consultation.

Tax Liens – How to Remove an IRS or State Tax Lien From Your Credit Report

Posted on by

The most effective tool the IRS has for collecting tax debt are tax liens. What’s worse is that they are very difficult to get removed. Even after you pay off the tax debt, the tax lien will stay on your credit report for up to seven years. Only after they have expired will they be removed from your credit report. These five steps show how to get expired tax liens off of your credit report.

1. Get Your Credit Report: Each year you’re allowed one free copy of your credit report. There are many sites out there that offer this service, such as AnnualCreditReport.com. Use one of these sites to get a copy of your Equifax, Experian, and TransUnion reports.

2. Check for Errors: Yes, even the credit agencies can make mistakes. Carefully check your credit report. If a tax lien that has been paid for over seven years ago, and it hasn’t been removed, you are able to dispute the information with the credit reporting agencies.

3. Dispute: Sometimes, if you view your credit report online, you can dispute an erroneous item through the website. Otherwise, you may send an email or letter to the agencies with your dispute.

4. Send Backup to Prove Your Dispute: When you send your letter of dispute, make sure you attach documents that prove the tax debt was paid, and when.

5. Check Your New Report: The Credit Reporting Agency will reply with a new copy of your credit report after 30 days. The new report should reflect the changes.

Back tax issues can be overwhelming, but there is hope. A good tax settlement professional has the knowledge and experience to help you overcome these types of problems. If you need help with a tax debt issue, or just want to see what options are available to you, talk to one of the licensed experts at Professional Tax Resolution. We specialize in tax settlements and you won’t talk to a salesperson. Call us toll free at (877) 889-6527 or visit us at www.professionaltaxresolution.com today.

An Alternative to an Offer in Compromise – Partial Payment Installment Plan.

Posted on by

The Partial Payment Installment Agreement allows a taxpayer to settle an outstanding tax liability for less than the full amount owed. Although it achieves much the same end result as the more popular Offer in Compromise, it is less well know and less frequently used.  In spite of certain drawbacks, the Partial Payment Installment Agreement represents another viable tax resolution alternative for those taxpayers who are unable to pay the full balance of their tax debt.

The Partial Payment Installment Agreement was implemented in 2005 to accommodate taxpayers with limited financial resources who had an outstanding federal tax debt. At that time, legislation amended the Federal Internal Revenue Code to allow the IRS to enter into an installment agreement for either full or partial payment of a tax debt. Before this legislation was passed, the IRS only accepted installment agreements for payment of the full balance of an outstanding tax liability.  This meant that the only option for settling a tax debt for less than the full amount owed was the Offer in Compromise. Since the Offer in Compromise has very strict eligibility criteria and is very difficult to obtain, many taxpayers who were unable to pay the full balance of their tax debt were left with no viable tax relief option prior to the passing of these amendments.

As with the Offer in Compromise, any taxpayer submitting an application for a Partial Payment Installment Agreement has to submit a complete and accurate set of financial records for careful review by the IRS. Because a Partial Payment Installment Agreement settles a tax debt for less than the full amount owed, an application is only accepted when the taxpayer in question can document that they are unable to pay the full amount of the debt. In addition, any taxpayer who is granted a Partial Payment Installment Agreement is subject to a complete financial review every two years. If the review indicates that the taxpayer’s financial situation has improved, the installment payments may be increased or the agreement may be terminated altogether.

If you need Tax Settlement Help Call and talk to a CPA today.

We offer free, no obligation consultations. Toll-Free (877) 889-6527

Professional Tax Resolution, Inc. is a tax settlement firm with over 15 years of experience helping clients resolve tax debt issues. Unlike many CPA firms, tax debt resolution is our entire business.  Our services include, but are not limited to, filing back returns, amending returns, setting up Installment Agreements, submitting Offers in Compromise, filing petitions for Innocent Spouse Relief, removing tax liens and levies, stopping wage garnishments and audit representation. No matter what the tax debt issue, our goal is to provide the best tax settlement option available. Our process will always begin at the source of the problem and follow the solution through to a complete resolution.

 Read our Reviews on the Better Business Bureau, Merchant Circle, Yelp, and others.  We will never make false claims or promises we can’t keep.