Archives for February 2011

Help With Tax Resolution Services: 4 Key Points To Remember When Being Audited By The IRS

Without question, the Internal Revenue Service is increasing the number of audits of American taxpayers every year, and the number of audits has risen every year for the past decade. With the country experiencing a budget crisis and with over 1,000 new IRS agents and auditors recently hired, additional funds have been earmarked for tax enforcement in 2011. Since the tax resolution experts at the Tax Resolution Institute have extensive experience working with the IRS, we know how to help you if you experience such a difficult situation.

More IRS Income Tax Audits In 2011

More IRS Income Tax Audits In 2011

It is true that the risk of you being audited in any one year is relatively slim: about 1% if your income is under $200,000, 2% from there to $1 million, and 6% for the ultra-wealthy. Most of the taxpayers selected for a tax audit are self-employed or have unusually large income tax write-offs. However, if you do experience the bad fortune of being audited this year, it’s likely to be for 2009 taxes. Why? Due to a big lag in the system, audit letters typically go out 18 months after the filing date. If you are being audited, here are 4 Key Points to remember when going through this arduous process.

Point 1 – If you delay, it can cost you the right to fight.

If you receive that awful letter from the IRS announcing an audit, make sure you take the action required within the time frame allotted. If not, you could make the situation quite a bit worse. The amount of time given is usually 30 days. If not addressed or contested, the dispute becomes a final assessment and moves on to the collections department. To be blunt, there is zero grace period. If you are unable to respond within 30 day, you have the right to ask for a postponement. In the vast majority of cases, the IRS grants such a request if you say you need the time to track down records.

Point 2 – It helps to have a tax resolution professional on your side.

Three-quarters of audits are conducted by mail, with the IRS simply requesting documentation to cover a specific part of the return. Most of the time, you can handle this type of audit on your own. However, if someone else prepared your taxes, get him to weigh in. If the audit requires an in-person meeting, it will probably get into greater depth on a certain issue. Never go into such a meeting by yourself. Rather, bring along a tax professional who can help you navigate the challenging maze of an IRS investigation and audit.

Point 3 – Always remember that anything you say or write is considered direct evidence and can be used against you.

Tax Resolution Services For IRS Tax Audit

Tax Resolution Services For IRS Audit

In any audit or encounter with the Internal Revenue Service, avoid providing any information beyond what is directly asked for by the IRS examiner. You might accidentally give evidence that could expand the scope of the investigation. This is another reason why having a tax professional on your side is essential. In a face-to-face audit, the rule is that the less said the better. By engaging in what seems like harmless small talk, you could incriminate yourself. When you hire representation, you actually do not have to attend the meeting with the IRS examiner. The best way to avoid a slip of the tongue is not to be in the room.

Point 4 — If your IRS auditor refuses to bend, you may be able to gain a foothold by negotiating with their supervisor.

If you are frustrated with your auditor’s finding and overwhelmed by their negative attitude, you can request to speak with their supervisor. As in most bureaucracies, the manager has more latitude to take action and offer possible concessions than the IRS auditor on the front lines. If your problem falls into certain gray areas, this strategy can be particularly effective. Even if the upper-level manager fails to see your side, you can still file an appeal. Due to what is often referred to within the IRS as the hazards of litigation, if a possibility exists that the court will side with the taxpayer, the IRS will choose to settle and offer you a deal.

The continual focus of the Tax Resolution Institute is to help the American taxpayer resolve their tax problems whether it is a looming delinquent tax bill or an upcoming IRS income tax audit. With a track record of no client complaints, we know how to get you the best results possible within the system. If you need tax resolution services, feel free to contact the Tax Resolution Institute at 800-401-5926 or fill out our  tax resolution form.

The Start of Income Tax Filing and Processing in 2011: New Tax Credits and Information to Benefit Clients

Valentine's Day Launches IRS Income Tax Processing

Valentine's Day Start: IRS Tax Processing 2011

If you were waiting to file your income taxes, you do not have to wait any longer. The IRS opened the door on February 14, 2011 – Valentine’s Day – for the processing of Schedule A forms, which are used to itemize your deductions. The IRS held off accepting these forms from taxpayers for the first part of the year because it was updating its software after the 2010 Tax Relief Act was passed late in December. For the procrastinators, taxpayers will have the luxury of time with a few extra days to file this year. The filing deadline will be Monday, April 18th, three days later than it normally is.

After all, when it comes to tax filing season, there are two kinds of people: those who file their tax returns right after they receive their W-2s, and those who toss their tax documents into a drawer, hoping that it will all just go away. If you are the latter and you have unfiled tax returns, contact the Tax Resolution Institute. We can help you resolve any past and current IRS tax problems. If you are planning to file, there are several new possible tax credits that should be taken advantage of in the 2011 tax season in order to save money. They include:

1) The Adoption Tax Credit — The health care reform act increased the maximum adoption tax credit to $13,170. The tax credit is refundable, so if the amount of the credit exceeds your tax bill, you’ll receive a check for the balance. The amount of the credit is limited to the cost of adopting a child, up to the maximum credit. Eligible expenses include adoption fees, court costs, attorney fees and travel expenses, including meals and lodging. Taxpayers who claim this credit are required to attach documents certifying the adoption, such as a court order or decree, to IRS Form 8839.

2) Installation of Energy-Efficient Windows or Doors in your Home, or the Purchase of a New Furnace or Air Conditioner — If you made your home more energy efficient last year, you may be eligible for a tax credit for up to 30% of the cost, up to a maximum of $1,500. A tax credit is a dollar-for-dollar reduction in your tax bill, making a credit more valuable than a deduction. It is essential to remember that $1,500 is a lifetime maximum. If you claimed the full credit on past tax returns, you can’t claim it in 2010, even if you made more home improvements last year. If you are not sure whether your energy-efficient improvements qualify, check the documents given to you by the manufacturer and the installation crew. Most manufacturers will certify that their products meet the standards for the credit. In addition, contractor should also be able to help.

Income Tax Credits For Embracing Conservation

Income Tax Credits For Embracing Conservation

3) The Purchase of an Energy-Efficient Vehicle — Some taxpayers who purchased hybrid cars in 2010 may be eligible for a tax credit for up to $2,200. However, the credit phases out after the manufacturer has sold 60,000 vehicles. For example, Toyota and Honda hybrids are not eligible for this tax credit. Ford hybrids purchased after March 31, 2010, are not eligible, either. However, taxpayers who purchased a plug-in, electric-drive vehicle, such as the Chevy Volt or Nissan Leaf, are eligible for a tax credit of up to $7,500. Other eligible vehicles include the Coda Sedan, the Tesla Roadster, and the Wheego LiFE EV.

With a traditional CPA business behind it, the Tax Resolution Institute believes in helping our clients not only by resolving their tax problems with the IRS with excellent tax resolution services, but also saving them money on current and future tax filings. By offering the best in tax services across the board, the Tax Resolution Institute has become the industry gold standard in terms of consistent reliability and true excellence. If you need tax resolution services, feel free to contact the Tax Resolution Institute at 800-401-5926 or fill out our  tax resolution form.

IRS Commissioner Doug Shulman Announces Reduced Penalties if International Tax Evaders Come Forward

International tax evaders who have hidden funds in international accounts will be able to avoid jail and pay reduced fines if they come forward and pay their delinquent federal income taxes. Under a new voluntary disclosure program announce by IRS Commissioner Dough Shulman, the Internal Revenue Service will allow international income tax evaders to avoid possible jail sentences and even stiffer penalties. The Tax Resolution Institute will help any possible candidates for this offer to see if this is their best choice to achieve true tax resolution for their unpaid tax debts. They key is finding a tax relief solution that works.

IRS Commissioner Doug Shulman Announcing New Offer

IRS Commissioner Doug Shulman Announcing New Offer

Tax evaders with international holdings or accounts will have until Aug. 31 to settle up with the IRS. If they fail to take advantage of this program, they will face an ongoing crackdown against Americans who hide assets overseas. IRS Commissioner Doug Shulman clearly stated: “If we find you, you face harsher penalties and the possibility of jail time. If you come in voluntarily, you pay a steep price but avoid going to jail.”

The offer is similar to a similar proposal the IRS made in 2009 that netted over 15,000 tax evaders. Justifying the new decision to make the offer again, Shulman pointed out that the IRS has closed 2,000 of those cases, collecting $400 million in additional revenue. Shulman noted that the new offer is not as generous as the previous one because he will not reward tax cheats who failed to take advantage of the 2009 opportunity. The goal of the Tax Resolution Institute is to allow such taxpayers to come forward without crippling their future financial viability.

Under the new program, tax evaders must pay back  income taxes, interest and penalties for the up to eight years, if accounts have been held that long. In addition, they will have to pay a penalty of up to 25 percent of the highest annual amount in the overseas account from 2003 through 2010. The 2009 disclosure program provided the IRS with many leads on the bankers and financial advisers who help Americans hide taxable assets. Shulman pointed out that the IRS is now investigating “a number of other banks” in order to continue tracking the flow of illicit funds. If you believe that it is time to step forward and take advantage of this federal delinquent income tax relief offer, please contact the Tax Resolution Institute today. And if you need tax resolution services, feel free to call the Tax Resolution Institute at 800-401-5926 or fill out our  tax resolution form.

IRS Offers International Tax Evaders A Way To Avoid jail

IRS Offers International Tax Evaders A Way To Avoid Jail

Don’t Let It Happen To You: TRI Helps A Successful Woman With An IRS Tax Levy And Wage Garnishment

If you have a tax problem with the IRS, it is essential not to take a wishful thinking approach, hoping your tax problem will just go away and sticking your head in the sand like an ostrich. The Tax Resolution Institute can help you resolve your delinquent income tax debt and unfiled tax returns problem, but only if you contact us and take action. If you ignore the multiple IRS letters that are sent to you and disregard an IRS tax lien placed on your accounts and assets, a difficult tax problem quickly will go from bad to worse with IRS bank levies and wage garnishments.


IRS Tax Debts Should Never Be Ignored

TRI always protects the anonymity and privacy of our clients. When we discuss a client’s case for the benefit of others, we change essential information. The point is to allow future clients to avoid the extreme IRS tax problems faced by some of our past clients. Recently, an established healthcare professional found herself in a terrible bind. Having ignored IRS letters, an IRS tax lien placed against her, and the announcement of an IRS Bank Levy and wage garnishment, she literally had almost no time to act. By the time she called TRI, she was in a serious predicament.

Already in a tight financial situation, her paycheck was about to be garnished and the IRS made her employer aware of her dreadful tax crisis. In desperate financial straits, she could not afford the basic retainer to start her tax case. Understanding her tax predicament and realizing that she had an excellent career, Peter Stephan made certain allowances that allowed the case to begin for a minimum initial payment.

When the successful woman pleaded that she would be put out on the street if her paycheck was garnished, the Tax Resolution Institute went into full gear to help her. Luckily, her employer was supportive and did not want to lose such an accomplished professional from their staff. The employer even requested that the IRS tax levy against her be released, but to no avail. The IRS does not listen to the pleas of employees or employers, taking a hard stance once an IRS tax levy is imposed.

IRS Delinquent Tax Debt Leads To A Tax Crisis

IRS Delinquent Tax Debt Leads To A Tax Crisis

Since her situation clearly was critical, Peter Stephan and the tax attorneys at TRI took immediate action. Since the bank does not remit funds to the IRS for 21 days once a levy is made, there was time to help the client with her serious tax case. With a graduate education and a valuable position in a hospital, it was essential to free the client from the burden of the levy and resolve her case. Since he had past experience with the IRS Revenue Officer assigned to the case, Peter Stephan was able to work out an installment agreement for the client that stopped the wage garnishment and the bank levy dead in their tracks. Grateful, the client realized that she no longer had to fear being put out on the street and everything would be okay.

Honestly, however, it was truly a close call that did not have to happen. If you have a serious IRS tax problem on account of delinquent income taxes and unfiled tax returns, please do not wait until there is an IRS tax lien against you and your bank account is about to be levied and your wages are being garnished. Take action today and avoid a wage garnishment and an IRS  bank levy by calling the Tax Resolution Institute, and we can help you put your life back on track. If you need tax resolution services, feel free to contact the Tax Resolution Institute at 800-401-5926 or fill out our  tax resolution form.

2011 IRS Audit Warning: Business Owners Targeted For Both Worker Misclassification And Unpaid Payroll Taxes

With business audits rapidly increasing in a difficult economy, the IRS is cracks down on the misclassification of workers. In order to protect themselves and the future profitability of the businesses, business owners need to know the regulations and their rights in order to avoid employment tax audits that are expensive and dangerous. The Tax Resolution Institute has helped numerous business owners avoid this potential deadly pitfall and save themselves a costly headache with the Internal Revenue Service. Any attempt to avoid payroll taxes by misclassifying full-time workers as independent contractors is a big mistake for any business.

IRS Audit Warning - Business Owners Targeted

IRS Audit Warning - Business Owners Targeted

The Jan. 31 deadline for filing Form 1099s for independent contractors is right around the corner. As a result, a central focus of the IRS is worker status. Why does the IRS care how a business owner classifies workers? It is a simple answer: The tax burden on a business owner changes dramatically depending on how a worker is classified. The IRS is zoning in on worker misclassification, and they do not care whether the mistake was matter deliberate or inadvertent. The IRS Revenue Officers have been given the mission to collect past due payroll taxes, recover the trust funds, and penalize business owners who have misclassified their workers.

It is a real temptation in a difficult economy for a business owner to classify a worker as an independent contractor. After all, for normal employees, business owners must withhold and pay Social Security and Medicare taxes, income taxes and unemployment taxes on all wages paid. In contrast, Independent contractors shoulder the burden of these taxes themselves. Employers only have to send them Form 1099 to declare their wages.

IRS Targeting 1099 Employee Misclassification

IRS Targeting 1099 Employee Misclassification

When a business is audited, the IRS examines a multitude of facets in terms of employee relationships with the company, including but not limited to the specific designation of work hours, who supplies the tools and materials for the job, and whether expenses are reimbursed. With state trust funds depleted across the country and the unemployment insurance system under siege, the IRS has placed a much higher priority on collecting past due payroll taxes than income taxes. To put it simply, payroll tax cases tend to create a much larger stream of revenue for the IRS. If you owe back income taxes on delinquent payroll taxes, do not go it alone. By seeking the help of a tax resolution specialist, the doors to your business can be kept open and there is an actual light at the end of the dark tunnel of your IRS tax nightmare.