Tax Liens
Tax liens are a claim by the Internal Revenue Service (IRS) placed on an uncooperative tax payer. A tax lien is a method used by the IRS to secure tax debt. The IRS can place a lien on real property if the owner of the real property is defaulting on their income taxes or property taxes. This applies for both state and federal taxes. This does not always mean the property will be sold. This is a tactic used to ensure you will pay your tax debt.
A tax lien does prevent you from refinancing or selling your property. It will be temporary property of the government until the debt is paid for. If a tax lien placed on the property isn’t enough to secure the debt, the IRS will levy the your bank accounts, your vehicles, and investment accounts until the debt is satisfied. A tax lien gives the IRS power to hold your property, but a tax levy gives them the ability to sell your assets to secure the amount owed.
Removing Tax Liens
Tax liens can also be placed on future assets. The filing for bankruptcy will not remove the liens placed. Paying your debt in full will have the IRS release any liens within a month of fulfillment. If you are unable to pay the debt in full, we recommend these avenues to be taken: OFFER IN COMPROMISE (OIC) / TAX LIEN WITHDRAWAL/ INSTALLMENT AGREEMENT. The Internal Revenue Service (IRS) will be relentless when trying to secure their tax debt.
Tax Levy
A lien and levy are different in that a lien is used to hold property to secure tax debt and a levy is used to sell all assets to secure tax debt. In summary, a lien hold the IRS’s interest in you property to secure tax debt and a levy allows the government to sell all your assets to secure the debt.
The IRS can take your home, automobiles, and personal property. The also can garnish your wages and take your tax refunds. If a tax payer refuses to pay their taxes while a lien is placed, the IRS will send a final notices stating their intent to levy your assets. They will also include your right to a hearing to contest the notice. This is usually sent 1 month prior to the levy. It may be delivered in person, sent to your business, current home, or last known address.
Avoiding A Levy
If you can can pay your balance in full once the notice is received, that will be the quickest way to avoid a levy. This is not always plausible for most tax payers in debt. An alternative route is to request an Installment Agreement by paying monthly payments. Submitting an Offer in Compromise (OIC) to settle for a lower amount than what is owed. You prove a Finical Hardship claiming that such an action will hinder your ability to make ends meet, however you will need to provide documentation. You can also File an IRS Appeal which is a claim that you believe the IRS has made a mistake in the determination of the debt owed.
The Tax Relief Survey is the fastest and most accurate way to find out if you qualify for the IRS Fresh Start Program. If you want to see if you’re eligible Click Here.
What Is Tax Forgiveness?
Tax Forgiveness is the overall term used to describe the programs that are provided to tax payers who have tax liabilities. Provided by the Internal Revenue Service (IRS), it is in place to provide assistance in lowering or cancelling your tax liabilities. Even though the IRS will enact enforcement actions regarding your tax liabilities, they still understand that there are circumstances where people are unable to pay. The IRS will try to augment your ability to pay some taxes back with Tax Forgiveness. Tax payers who can’t make ends meet and pay basic living cost will be put into the “Financial hardship” category. It can be very stressful, however we’ll guide you through the process.
Getting Your Taxes Forgiven
Your current standing with the IRS will determine which forgiveness program you will qualify for. The main key is to show proof that you are unable to pay back your tax due to your financial hardship. Due to the requirements needed to get approved, it is best to seek a tax experts guidance. Per the IRS, after 10 years, your tax liabilities will automatically be forgiven, however there is a catch. The IRS will not stop with the enforcement actions of liens, wage garnishments, and levies. This is why its important to not put your tax liabilities on hold. There are many misleading tax liability calculators on the internet that are used as a marketing tool rather than an informative one. When you speak with one of our professionals, they’ll provide you with accurate calculations and guide you to the appropriate programs.
Tax Settlements
A tax settlement is when the Internal Revenue Service (IRS) will accept an amount that is considerably lower than the liability owed. Frequently, the IRS will accept such settlements in pressing circumstances. Tax Settlements can help drastically reduce the amount you owe to the IRS and bring you the peace of mind that you’re owed.
What Are The Main Benefits To A Tax Settlement ?
Owe state or federal taxes? Given you meet the criteria, you could be settling your tax debt for a fraction of the amount owed. The moment the settlement amount is approved and paid for, your liability will be considered paid in full. You will no longer incur any penalties or late fees.
When the IRS enters into a settlement agreement with you, you now are guarded from any enforcement actions that are taken against taxpayers who owe money. Any actions such as liens, tax levies, and wage garnishments.
Negotiating A Tax Settlement
There are millions of tax payer across the country that get stuck with tax liabilities every year. It can be burdensome however, it’s not something that should go unresolved. If you wait too long on paying your tax liabilities, it can lead to incurred fees and penalties. Also, liens may be placed on your property and bank accounts. if you ever find yourself in such a situation it is not the end of the world.
Depending on your current circumstance, the IRS will allow a negotiation regarding your tax liabilities in the form of a tax settlement. Paying less than you owe is always ideal. For example, if you own $50,000, the IRS may accept a settlement for $15,000. If that $15,000 is too much to pay in one payment, you could always break it down into smaller payments of $2-3,000. Now let’s talk about the steps you’d have to cross off your list.
Submit Unfiled Years
Any unfilled taxes need to be submitted immediately. There will be no tax settlement consideration if you have unfilled returns. If there was any Substitute For Return (SFR) created by the IRS for any outstanding returns, also seek to amend them.
There are a variety of different tax settlement options available to you. Here are a few examples :
Offer In Compromise(OIC)
OIC may be difficult to get accepted, however if you are you can pay 20% of the settlement amount at the beginning, you can pay the rest in smaller increments over the months. This is commonly know as the lump sum OIC. You can also opt for periodic payments which can be 6 months or 2 years.
Partial Payment Installment Agreements
With a partial payment installment agreement, you make monthly payments over the length of several years, However during that time some of your taxes will expire. Even though you haven’t negotiated a lower amount for your tax liabilities, you’ll end up paying lower than the amount agreed on.
Penalty Abatement
Know as one of the easier ways to lower tax liabilities when penalties have caused it to balloon. You’ll have to give a well explained reason as to why you couldn’t pay or file in a timely manner. When approved, the IRS will remove some if not all your tax liability penalties.
Submit Your Application
The application process can be very stressful. It includes forms to fill out, documentation to provide, and fees to be paid. You can try handling this on your own, however bringing in a tax expert who understands and has dealt with the IRS many times before is crucial for a successful application process. (Once The Application Is Submitted, The Internal Revenue Service (IRS) Will Review And Decide If They Will Accept The Settlement. When Accepted, The IRS Will Consider You In Good Standing For The Duration Of The Settlement. Should You Fail To Make A Payment Or Default, The IRS Will No Longer Consider You In Good Standing.)
Vetting A Tax Settlement Company
There are tax settlement that may be fraudulent, however most of them are vetted and legit. Avoid tax settlement companies that guarantee a specificities outcome without properly reviewing you tax issue.
When it comes to tax settlement, make sure you partner with a company that has a clear understanding of your circumstance before guaranteeing a favorable outcome. A tax settlement company should have tax experts, Enrolled Agents, Tax Attorneys, and CPA’s ready to work for you.
Tax Settlements And State Taxes On Your Own
Just like with federal taxes, the IRS is open to tax liability settlements when it comes to state taxes. like federal taxes, The minimum requirements are still needed for the state. You can attempt to settle your own state taxes, however it is a difficult process that includes a lot of difficult paperwork. This is not the IRS’s intentions, however they need the proper documentation and proof to vet applicants for acceptance . This is why it is recommended that you partner with a tax expert to give you your options before attempting to settle your state tax liability.
Qualify For Federal Tax Assistance?
Are you ready to take the next step in getting enrolled in a federal program that can reduce or eliminate your tax debt? We’ve partnered up with the top tax relief officers. No long wait times waiting for IRS assistance, we will put the call straight through. Take the survey below to see if you’re eligible and a tax relief officer who specializes in these programs will reach out. Qualify Survey Here
Negotiation With The IRS-Is It Possible?
Negotiating with the IRS is possible. If you are going to negotiate with the IRS, it should be done so in a timely manner. Putting dealing with your tax debt on hold can cost you thousands more. Not only will penalties incur, but the IRS will take enforcement actions against you to secure the debt. The IRS will come at you with liens, tax levies, and garnish your wages. This will also take a toll on your credit score.
The following are some of the ways to negotiate with the IRS:
penalty abatement: Negotiation with the IRS to lower or remove penalties and interest that you have incurred
penalty extension: If your debt is fairly new, you can negotiate with the IRS to give you an extension to pay your debt which will prevent any enforcement actions
penalty payment agreement : This is very similar to a payment plan, however with partial payment, the IRS is accepting less than the amount owed
offer in compromise (OIC): This is negotiation with the IRS to drastically lower your debt
Currently not collectible: in some cases, the IRS may drop all enforcement actions against you due to your financial hardships
Tips For Negotiating
There are ways to reduce your debt with the IRS. Before you start negotiating with the IRS, be sure to have all the appropriate documentation to present to them. These documents include your tax records, banking statement, monthly expenses, pay stubs and any other notices you’ve received from the IRS. If you owe a high amount of tax debt, you should defiantly not handle it alone.
The higher the amount, the more difficult it will be to defend your case to the IRS on your own. Before going with a tax relief company, it would be a good idea to gather data on them. There are many fraudulent tax relief companies out there that do not have their clients interest as a priority.
The limit for filing a federal tax lien notice is $10,000. You’ll be able to get the lien removed once your balance is completed paid off or you get your balance under $25,000 while having it in a Direct Installment Agreement.
small businesses can set up a two year payment plan to pay down their tax debt if the amount is $25,000 or less. Speak with one of our tax experts today regarding small business help.
IRS Tax Appeals
An IRS appeal is not suitable for every tax situation especially if you’re currently being audited by the IRS. The are situations when it is ideal for you to appeal. If a letter was sent to you from the IRS stating your right to appeal, your disapproval with the IRS findings, or if you don’t plan on signing the form sent to you then you are entitled to appeal. If you’re going to appeal, there are some things to consider such as:
The IRS made a wrong decision due to misinterpreting the law
The IRS neglected to apply the law while making their decision
The IRS is taking excessive collection actions against you while denying you relief programs
The information used against you by the IRS is false or misrepresented
If the letter you’ve received from the IRS does not mention an appeal process, you couldn’t provide sufficient information during an audit, and your only issue is you can’t afford to pay the amount owed, then you may not be eligible for an appeal. There are still several ways to fix you tax issue and Safeway Tax Relief is prepared to find relief by all means.
while disagreeing with the Internal Revenue Service (IRS), you should be prepared to provide evidence and records to back your claims. Also you’ll need an attorney and/or an enrolled agent to represent you during an appeal.
Appeal Process
Once you’ve received your letter from the IRS with their decision and the amount owed, your process begins. An address of where you can file the protest will be in the letter sent to you with a date it needs to be submitted by. The average time frame you have to protest is 1 month. Ensure that the letter is sent to the address lien by the letter and not to any other department in the IRS. Once received, the IRS will examine your protest and attempt to resolve the protested issue before it goes to the Office of Appeals. If unsuccessful, the protest will move forward to the Office of Appeals for evaluation. It may seem like a simple process, however there are many minor details in the written protest, that if incorrect, can delay or cease your appeal process.
What Is Tax Debt Relief?
The Internal Revenue Service (IRS) gives tax debt relief for taxpayers. The IRS takes many factors into consideration when deciding if you qualify for their tax programs. The IRS takes into consideration annual income, expenses, assets, and ability to pay.
The IRS may determine that your are “Currently Not Collectable,” however this is not permanent. Even though you may not be asked to make payments and all actions against you stop, your tax debt will continue to incur interest and late fees. The bottom line is you will need to, at some point, deal with this debt head on. The IRS will provide tax debt relief through tax debt settlements or accepted payment plans. Taxes can be a headache. There is no one solution to the many tax issues. The relief programs are not guaranteed. The longer you put your tax issues on hold, the more interest and fees will incur. Eventually, the IRS will take action against you such as placing a lien on your home or garnishing your wages.
Offer In Compromise (OIC)
The Offer in Compromise (OIC) is a program created by the Internal Revenue service (IRS) to allow qualified tax payers, with unpaid tax debt, to negotiate a tax settlement for less than what is owed, and clear the debt. There is an initial application fee of $205 to the IRS (non-refundable). You must also submit a Form 433-A (OIC) or Form 433-B (OIC) and a Form 656. The checklist is to be filled out on the form 656 and submitted and it will determine if the tax payer is qualified for (OIC). The point of the Offer in Compromise (OIC) program is to accept a compromise that is in favor of the government and the taxpayer while still promoting voluntary compliance with all future filling and payment requirements.
One of the three following conditions must be met in order for a tax payer to get accepted for (OIC):
Effective Tax Administration – you don’t contest collectibility, liability, but can prove special or extenuating circumstances that a collection of the debt by the IRS would result in economic hardship.
Doubt as to Collectibility – You can show that the full amount of the debt is uncollectible (you don’t have the funds).
Doubt as to liability – you can show reason that the debt in questions has been assessed incorrectly.