The Tax Resolution Institute was able to lower the back tax liability of a San Francisco Petroleum Executive by $120,000. By employing federal tax expertise and experience with the IRS, we were able to protect or client from an incorrect assessment after a tax shelter was disallowed. If you need help with a big income tax debt or problem, check out the details of this account. Most likely, we can help you as well and provide real tax relief.
An Executive Tax Shelter Disallowed
The Petroleum Company President recommended that the Executive enter into a major tax shelter. Although the Petroleum Company accountants estimated a less than 50% chance of shelter being viable, the company applied the pressure. When the president of a company recommends something to you, such a recommendation should be considered more of an exclamation point than a question mark. Knowing he had to go along in order to keep in good standing with the company, the Executive invested in the tax shelter despite initial misgivings.
Ultimately, it turned out that his initial misgivings were right on target. Seven years after the tax shelter was created, the IRS reviewed and disallowed it. All of the executive who took part in the tax shelter were considered full partners. As a result, he IRS assessed the tax liability across the board equally. Such an assessment, however, turned out to be incorrect when it came to the future client of TRI.
The Shock of an Incorrect Tax Liability Assessment
Our executive client who had the initial misgivings chose to stop taking the allowed deductions from the shelter after the first three years. Unlike his partners who had continued to take the personal income tax deductions for the entire period, his liability should have been significantly less. Since the IRS had assessed the liability as a whole, the back taxes owed by the Petroleum executive were much greater than what he had actually received in deductions taken from the tax shelter.
A major challenge is once a penalty has been assessed, the IRS does not want to admit that an assessment is ever wrong. Even when an inconsistency or problem is pointed out, changing the assessed amount remains difficult. Luckily, the San Francisco Petroleum Executive came to the Tax Resolution Institute. With years of experience handling such incorrect assessments, our tax experts knew what to do.
TRI's Helping Hand and Tax Relief
After intense negotiations and the filing of an amended tax return, the TRI Tax Experts appointed to the case were able to have the Petroleum executive’s tax liability pro-rated. In the end, after the new assessment, the amount owed in back taxes due to the disallowed tax shelter was reduced by approximately $120,000 in light of the actual tax deductions taken. If you are in tax trouble with the IRS and need tax relief, please contact us and we can help you. In truth, as the largest collection agency in the world, the IRS often makes mistake when it comes to assessments. The goal of the Tax Resolution Institute is to amend such mistakes in order to protect your financial future and the security of your assets.
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