If you’re looking for a firm that will focus on your individual needs, and always treat you like a client who matters, look no further. Our firm is large enough to offer a full range of professional services, but small enough to give you the individual attention that you deserve.
We will thoroughly and conscientiously study your personal situation, and tailor our advice to your specific needs.
IRS Audit Representation
Getting an IRS audit notice often strikes fear in the heart of the recipient. Thoughts such as did I save all my receipts for that year? or did my preparer just estimate those numbers without any solid basis run through one’s mind? However, the IRS sometimes accepts oral testimony if it makes sense.
I once represented a self-employed Painter who didn’t keep good records. One of the issues was auto expenses. I simply explained to the auditor that my client had to buy the paint and transport it to his client’s homes in order to paint them. The auditor listened to our common sense explanation and allowed my client a reasonable amount of auto expenses. My client was very happy with the results of that audit.
Having worked both as an IRS Auditor and having successfully represented many individuals and businesses as a CPA, I have extensive experience in handling both simple and complex audit issues. This includes experience in difficult situations such as an income probe of a closely held business and going up the chain of command to get someone who is reasonable and more objective. Thus, I’ve been in the trenches and know how to get results with the objective of saving my client’s time and money.
Un-Filed Tax Returns
Partly due to the recession and partly due to fear, once you fall behind on filing your tax returns it becomes a mental block that individuals and businesses put on the back-burner. Non-Filers often rationalize that since I can’t pay my taxes and I know I owe, I better not file them or the IRS will come down hard on me. What they fail to realize is that filing is the first step since one is not eligible for a payment plan or the opportunity to submit an Offer in Compromise without first filing all of their returns and becoming current. Coming out of the closet and filing actually shows “Good Faith” and “Compliance” which is exactly what the IRS is looking for. Thus, it behooves one to file all of their tax returns whether they can pay what they owe in full at that time or not.
I’ve written an article entitled, “How Unfiled Tax Returns Can Hinder Your Chances of Settlement With The IRS,” which has appeared on the California Society of CPA’s website and The San Fernando Valley Business Journal. See the articles written section in this website to read the article.
Back Taxes Owed
There is an extensive analysis to be done when either a business or individual owes back taxes. There are basically four possibilities to resolve your case when a business or individual owes back taxes.
AN INSTALLMENT AGREEMENT
In order to be eligible for an installment agreement, one must have all his/her tax returns filed and be properly withheld or paying one’s quarterly estimates. The amount the IRS requires as a monthly payment depends upon many factors such as how old the tax year’s owed are, your monthly income and expenses, if your married, how many dependents you have and if your living expenses are within the IRS guidelines. This requires some analysis by a professional who knows what is acceptable to the IRS and what isn’t.
NON-COLLECTIBLE HARDSHIP STATUS
Another possibility if one is unemployed or is facing hard times is requesting to be placed in Non-Collectible hardship status. This doesn’t make your tax liabilities disappear or stop the running of interest and is a temporary classification. The IRS will check with you periodically and inquire as to whether one’s financial situation has improved. If so, the IRS will want payments to begin.
OFFER IN COMPROMISE(OIC)
Acceptance of an OIC is the acceptance by the IRS in settlement of one’s tax liability for less than 100% on the dollar. You’ve likely seen TV or radio commercials advertising settlement for pennies on the dollar. However, the process depends on facts and circumstances, the submitting of an extensive financial package to the IRS, and their acceptance of one’s Offer. The IRS looks at one’s assets versus liabilities and one’s monthly income versus allowable living expenses. Basically, the IRS only accepts offers if there is doubt as to liability or doubt as to collectibilty i.e., the settlement is as much or more than they would otherwise expect to collect.
I can help guide you through the maze, analyze your situation, and see if you qualify for an OIC.
The IRS will always accept voluntary payments from a taxpayer. However, please note that absent a formal installment agreement, the IRS may continue with enforced collection action such as filing a tax lien, wage garnishment or a bank levy. Thus, an installment agreement is more prudent since the IRS will not continue with enforced collection actions against you.
Payroll Tax Problems
Quite often business owner’s finance their businesses wrongfully by becoming delinquent on their payroll taxes. This has far reaching implications including the potential imposition of a trust fund penalty personally against the owners/officers of the business who were responsible for the payroll taxes. These cases are a bit more complicated since payroll taxes are a sensitive area in the eyes of the IRS and state agencies because they view it as double-dipping since the exployee’s are claiming withholding on their tax returns and the business owner’s are not paying in what was deducted from the employee’s wages.
The IRS can literally shut down a business that continues to be delinquent on their payroll taxes so this problem must be dealt with directly and promptly.
An IRS Levy consists of the government taking assets such as the levy of one’s bank account. For example, you go to sleep one night believing you have $2,755 in the bank knowing that you’ve written $2,425 of checks against it leaving yourself with a little cushion. Imagine the shock you would be in for the next morning if the IRS were to execute a bank levy for $2,500 against your account for delinquent past taxes.
This is why it is imperative that you don’t ignore and deal with any IRS problems that arise besides avoiding unnecessary interest and penalties. Thus, it behooves one to be on a payment plan so you know where you stand and not be fearful of the IRS seizing any money that you have in the bank.
An IRS Tax Lien is filed with the county recorder’s office and is notice to the world that if one acquires any assets, the IRS is first in line to collect (has first rights). This appears on one’s credit report and can only be removed by either full payment or payment via an Offer In Compromise. You want to avoid this if at all possible.
An IRS Seizure can be more permanent than a one-time levy of one’s bank account. The IRS can literally take your assets such as your automobile or home. Once they’ve tied up your asset(s) it’s often difficult or impossible to get them to reverse their actions. The point is you don’t want to ignore their tax notices or your IRS problem becuase it won’t go away by itself. Sure, the IRS may delay enforced collection actions but when they take enforced collection actions, it will be decisive since they are often loathe to forgive non-compliance or the lack of good faith. You need professional representation to guide through your problem and avoid a seizure of your aseets. Feel free to contact me immediately for help.
IRS Penalties add up quickly and frequently can be abated if a taxpayer has reasonable grounds for abatement. Reasonable grounds for penalty abatement often include but are not limited to destruction of records, bad advice from a preparer, death or serious illness of a family member, serious illness of the taxpayer. I’ve had success in getting penalties abated when circumstances were warranted. Ask me about this service if you have penalties that you feel are possibly worthy of abatement.
Bankruptcy Tax Discharge Analysis
The recession has caused many folks to run to file bankruptcy to protect themselves from creditors, foreclosure etc. Although there may be a strong sense of urgency to file bankruptcy, doing so without carefully considering the discharging of taxes through one’s bankruptcy can be a dire mistake. I can prepare a tax discharge analysis and work with your bankruptcy attorney to ensure that this issue is properly addressed.
If you’re facing tax liabilities as a result of your ex-spouse’s negligence or fraud, you may be able to file an innocent spouse claim with the IRS. I can assist you with this and, if successful, your liability may shift to your ex-spouse freeing you of the burden.