The Blog

The first step in resolving an outstanding tax liability should be to verify that the amount of the tax debt being reported by the IRS or State Tax Agency is correct. Because tax law is so complex, important tax deductions or tax credits are often missed when returns are completed by individuals who lack the professional knowledge and experience to determine which ones apply. Often a missed deduction, a missed tax credit, a change in filing status or an overlooked income adjustment will result in a tax amount owed that is greater than it would have been if the item had been claimed on the return. That being the case, the filing of an amended return is sometimes the simplest and most cost effective way … Continue reading →

In 2010, taxpayers filed more than 144 million tax returns to the tune of about $1.2 trillion in gross collections according to the IRS. Nearly 60% of the returns were handled by professional tax preparers. Since all tax specialists are not equal, picking the right tax settlement professional can mean the difference between getting your maximum tax refund and getting audited. Here are 3 ways you could be scammed by a tax preparer: You’re promised a big refund. If you are promised a big refund before any of your financial records have even been seen, chances are that you are being scammed. If the focus is a large refund, the tax specialist could be muddling your deductions and numbers, which could set you up for an IRS review … Continue reading →

It’s the day after taxes were due, April 18th, 2012. What do you do if you still haven’t filed your tax return? The IRS has some guidelines for what happens with returns that are past due. If the IRS doesn’t hear from you and you don’t file a return: The IRS will increase your taxes as they assess penalties and interest. A substitute return will be filed for you from the IRS, based only on information they have from sources other than you. Therefore, you would not get any additional exemptions or deductions you could be entitled to and your tax liability could be overstated. After the IRS assesses your taxes, the IRS will begin the collection process. They could place a levy, which is … Continue reading →

The IRS recently released statistics showing that while more taxpayers have filed earlier this year, the tax return refund amount they are getting back will be less on average and most likely received through direct deposit. According to the IRS, 75.3 million Americans have already been sent their refunds as of March 30, 2012, compared to 75.2 million last year at the same date. While more taxpayers have filed early this year, the average refund has dropped from $2,922 in 2011 to $2,826 in 2012. Last year, a payroll tax cut allowed workers to pay 2% less into Social Security and Medicare, which could partly explain the change. However, the total taxable income for these workers also increased. More taxpayers are requesting direct deposit this … Continue reading →

What is the law regarding the payment of federal income taxes? Although taxpayers are initially given the responsibility of determining the amount of tax they owe by completing and filing the appropriate tax returns, paying income taxes is not voluntary. The requirement to file an income tax return and pay income taxes is clearly stated in the Internal Revenue Code, which imposes a tax on the income of individuals and corporations as well as estates and trusts. Failure to file an income tax return and submit payment of taxes with the return can result in harsh civil and criminal penalties, including fines and even imprisonment. What are frivolous tax arguments? Frivolous tax arguments are a group of arguments that are made by taxpayers who oppose … Continue reading →

The Federal Government recently announced a major expansion of its Fresh Start Program which was initiated last year to help taxpayers stuggling with tax debt. The recent changes supplement efforts that were already in place under the original Fresh Start Program to help individuals and businesses meet their tax obligations and reach tax settlements. Three major areas targeted by the recent Fresh Start expansion are penalty relief, Installment Agreements, and Offers in Compromise. The changes to these areas of tax relief are outlined below. Penalty Relief What is the failure-to-pay penalty? The failure-to-pay penalty is an amount assessed by the IRS on any tax amount owed that is not paid by the filing deadline. It is usually assessed at the rate of one half of one … Continue reading →

When choosing tax expert for your personal tax preparation needs or a business tax specialist for business tax preparation, it is highly important to choose a proven tax advisor with expertise in tax settlements and favorable reviews from previous clients. This is what clients of TaxMasters, a recently bankrupted tax preparation company in Houston, Texas, learned after trusting their tax returns to this company, who had broadcast a nationwide commercial promising to settle tax debt for less. The State of Texas is suing Tax Masters because they advertised free consultations with a tax specialist, but calls were actually received by salespeople not qualified to give help with taxes. This would be a violation of the Texas Deceptive Trade Practices Act. TaxMasters may have delayed submitting clients’ taxes until all fees … Continue reading →

The tax specialists at Professional Tax Resolution are a good choice for resolving your tax settlement issues. They are: Licensed  The tax resolution professionals at Professional Tax Resolution are Certified Public Accountants and Enrolled Agents. These are the only tax specialists who can represent you before the IRS on all tax issues, not just returns they have personally prepared. Experienced  The tax specialists at Professional Tax Resolution resolve tax debt issues for both individuals and businesses all day, every day. Because tax settlement is their only focus, they know how to successfully negotiate with the IRS to achieve the best tax resolution outcome for each client. Knowledgeable  The tax specialists at Professional Tax Resolution are familiar with all of the available tax settlement options and are well equipped to select the … Continue reading →

Did you know that you could be taxed on your frequent flier miles? That’s what thousands of Citibank customers learned when they received a 1099-MISC from Citi, which reported their miles as income to the IRS. These miles would have to be reported on their tax  returns, or they could risk getting a notice from the IRS. Understandably, some customers who were notified that 30,000 miles was considered $750 of income were furious and shocked that the bonus miles they earned from signing  up for a Citibank credit card could be taxable. Some even asked to have miles canceled and were told by Citibank that they should have asked before the end of 2011, even though customers were not aware of this tax liability until they … Continue reading →

The help of a qualified tax settlement professional can be an invaluable asset in attempting to resolve any type of back tax issue. However, the selection of a reputable tax professional can be a difficult task in itself. It is important to verify any advertised credentials before hiring because many individuals and companies who advertise tax settlement services are actually marketing agents and salespeople with no professional qualifications. Tax law is so complex and the policies and procedures of the IRS are so complicated that it takes an individual who is both knowledgeable and experienced to successfully negotiate a tax settlement agreement.  Some things to look for: Select a well established individual or firm, one that is likely to still be around to answer questions … Continue reading →