Settlement Archives - Page 9 of 14 - Professional Tax Resolution

Category Archives: Settlement

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

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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

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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

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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.

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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. 

 

Payment Installment Options for an IRS Offer in Compromise

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The IRS Offer in Compromise tax settlement option allows a taxpayer with an outstanding tax liability to settle the debt for less than the full amount owed. Although the Offer in Compromise has very specific acceptance criteria and may be difficult to obtain, it is a very attractive tax debt settlement option for those taxpayers who do qualify.

The IRS has made the Offer in Compromise a particularly attractive and popular tax settlement choice by offering three different payment plans. The flexibility makes this tax settlement choice attractive to taxpayers who have varying financial situations. Each of the payment options (outlined below) includes an initial payment to be followed by scheduled installment payments.

• The Lump Sum Cash Payment Plan requires an initial payment which must be equal to 20% of the Offer in Compromise tax settlement amount. The balance of the negotiated tax relief amount must be paid in five or fewer installments scheduled regularly from the date the compromise offer is accepted. (sapns2.com)

• The Short Term Periodic Payment Plan requires an initial payment to be followed by regularly scheduled installments that begin while the offer is being negotiated. The balance must be paid off within 24 months from the time the IRS receives the Offer in Compromise application.

• The Deferred Periodic Payment Plan requires an initial payment to be followed by regularly scheduled installments that begin while the offer is being negotiated. The balance must be paid off in more 24 months from the time the IRS receives the Offer in Compromise application but before the ten year statutory period for collection is up.

Hence, the IRS Offer in Compromise is not a one stop shop. The versatility of the available payment plan options accounts for some of its popularity and make it an attractive tax debt settlement choice for a wide range of taxpayers.

At Professional Tax Resolution we make sure that you take advantage of the best tax resolution option available. We carefully analyze the tax debt and financial situation of each of our clients and only recommend filing an Offer in Compromise when we believe it will be accepted. If we determine that you meet the candidacy requirements for an Offer in Compromise, we will work with you to prepare the offer and to submit all of the required documentation. We will also represent you before the IRS or State Tax Agency until the process is complete.

Click the “Learn More Link” or Call Toll-Free (877) 889-6527 to have one of our CPA’s provide a free, no obligation consultation regarding your eligibility for an Offer in Compromise.