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What Should You Do When the IRS Files a Notice of a Federal Tax Lien Against You?

What Should You Do When the IRS Files a Notice of a Federal Tax Lien Against You?

By on Sep 9, 2019 in IRS | 0 comments

Getting a notice of a federal tax lien filed against you could mean that you won’t receive the proceeds from any property sales you make. When a lien is in effect against your house or another piece of property, the IRS gets paid out of the sales proceeds before you receive any money. If there’s nothing left when the IRS is done taking its chunk, then you literally get nothing. Worst of all, liens are always a matter of public record when they’re filed. The lien records the full amount owed to the IRS, which means you won’t be able to hide from it. These documents are designed to protect the government’s ability to collect a tax when it seems doubtful that they otherwise would be able to. While this is a scary situation, you shouldn’t get all worked up about it. Take a deep breath and consider the following tips from the experts at Success Tax Relief. Getting Rid of a Lien Once Its Filed Each time the IRS files a lien, they put a taxpayer’s balance due flat down on the books by assessing their liability. They then respond by sending out a bill called a Notice & Demand for Payment document. Those who fail to pay this debt have a lien officially levied against them. As long as you make sure to pay these bills or work with the IRS on an alternative, then you shouldn’t have too much difficulty avoiding a lien. This isn’t too much help if you’re already in the hole, however. Paying your tax debt in full will force the IRS to release the lien within 30 days of when you finish paying it off. If you can afford to do it, then paying the bill outright can completely eliminate the problem. IRS agents are never allowed to keep a lien against those who have demonstrated that they’ve done so. Unfortunately, this may not be an option depending on your specific financial situation and how much tax you owe. Other options do exist for reducing or eliminating a lien, and you may want to explore them if you find yourself in this trap. Discharge of Property Some taxpayers are eligible to receive...

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How Do I File a Financial Hardship With the IRS?

How Do I File a Financial Hardship With the IRS?

By on Aug 29, 2019 in IRS | 0 comments

Did you know that there’s an IRS program that could get those collection agents off your back for as long as you need to get back on your feet? Would you believe us if we said that there wasn’t even a charge involved? At Success Tax Relief, we’re often asked whether there’s any program that would apply to people across the board like this. Fortunately, there is. Taxpayers who are truly in need can file a financial hardship with the IRS and have a temporary forbearance placed on your account. As with everything related to federal taxes, however, you’ll need to prove a few things before the IRS will be willing to flat out grant you the kind of relief you’re looking for. Who Qualifies for a Hardship? Only people who genuinely cannot afford to pay their tax bill could ever truly qualify for hardship status. An overwhelming majority of those who apply for this coveted status get rejected rather easily because they didn’t meet a certain standard. The IRS has a tendency to have very specific requirements when it comes to granting an individual taxpayer the right to file as currently not collectible (CNC), which is also known as status 53. Keep in mind that this is essentially more of a stay on collection than a complete absolution. You’ll probably have to pay the bill at some point in the future. However, the IRS doesn’t come after you even if they do require certain interest payments and penalties to continue to accumulate somewhere in the background. Those who are already working with a representative from the IRS can request that the organization mark the status 53 block on their form. This means that a collector has filed Form 53 (Report of Currently Not Collectible Taxes) and given at least a cursory level of approval so far. Unfortunately, this form is always filed internally. Earning the Status 53 Filing Status That means you’ll be on the hook to file a few documents yourself in most cases. IRS agents could ask that you fill out Form 433-A, 433-B or 433-F to show that you really do have a legitimate hardship. In general, this requires the following to be true: Your...

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What are Quarterly Estimated Tax Payments?

What are Quarterly Estimated Tax Payments?

By on Jul 2, 2019 in IRS | 0 comments

How would you feel if you got stuck paying a fee to the IRS even though you paid your taxes every single year? This happens to many people who failed to make estimated payments. Regardless of how you earn income, you have to pay your taxes during the whole year and not just in the first quarter of the next calendar period. If you don’t have some of your money withheld by your employer, then you’re going to get stuck with a lump sum when you file your income tax return. When that happens, the IRS will stick you with a penalty that will ruin your day. Making regular quarterly estimated tax payments is a good way to avoid this problem. Estimated tax can cover all income that isn’t subject to withholding. It’s a solid payment method for the money you make in any of the following ways: Self-employmentInterestDividendsRent you collectAlimony checks In some cases, you might be subject to a voluntary withholding program. If you’d don’t elect to take advantage of this opportunity, then you’ll want to make estimated tax payments on any other money you have coming in. Calculating what you should be handing over to the IRS isn’t all that complicated. Figuring Out Quarterly Payments To find out how much your federal quarterly estimated tax payments should be, you’ll have to estimate your adjusted gross income. Once you do, you’ll be in a good position to at least have a good guess as to the taxable income you’re liable for and how much tax you’ll end up owing for the whole calendar year. As soon as you know these values, take a moment to estimate your credits and deductions. In most cases, you should have a fairly good idea as to how much you can take off your total burden. Don’t go too wild and add in deductions that you’re unsure apply to you. However, you don’t need to feel like you have to be too cautious. If you end up missing a deduction you were eligible for, then you can generally claim it later on when you file your income tax return next year. Many taxpayers find that by making these quarterly payments they end...

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5 Consequences of Filing Late Tax Returns

5 Consequences of Filing Late Tax Returns

By on Jul 2, 2019 in IRS | 0 comments

Not filing an income tax return can actually land you behind bars! It’s a very rare occurrence because the IRS would rather not have to spend taxpayer money to support incarcerated people. However, it has happened before on rare occasions. If you’ve ever thought that you could avoid the hassle filing a tax return simply by putting it off, then think again. At Success Tax Relief, we’ve seen plenty of people who try to avoid the process for as long as possible until bad things start to happen. In most cases, you’ll find some penalties levied against you or something similar. While few people like the IRS, you do have to give them credit. They at least give you fair warning as much as possible before they resort to any of the following five unpleasant tactics! 1. Late Fees & Penalties Perhaps the single most pressing and scary consequence of filing a late tax return is getting slapped with a big late penalty from Uncle Sam. If you’re expecting a refund, then you might not get too much of a scolding. You might end up losing some portion of said refund, though. People who owe the government money get the worst punishment, however. Late filing penalties kick in immediately following your deadline. Come April 16, the IRS starts counting days. You’ll typically have to pay something like 5 percent of the unpaid sum for each money you delay filing your return. The IRS won’t stop increasing this value until you get to 25 percent in most cases! 2. Loss of Your Refund While it’s not quite as scary as getting stuck paying late fees, nobody wants to lose out on a refund they have coming to them. If you’re owed money back from the federal government but don’t file on time, then you could end up getting less than you expected. Those who take an extra long time might forfeit the entire sum, which is an especially big problem for anyone who needs that money to make necessary purchases or pay an outside debt. 3. Substitute for Return Filing Individuals who fail to submit a return will start getting hounded by the IRS. If they still don’t listen, then...

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4 Reasons Why the IRS Might Deny a Payment Plan

4 Reasons Why the IRS Might Deny a Payment Plan

By on Jul 2, 2019 in IRS, Taxes | 0 comments

If you’ve been following our advice, then you know that one of the top services that Success Tax Relief offers is affordable installment payment plans with the Internal Revenue Service (IRS). We take pride in these plans and how many customers we helped. In addition, if the IRS is giving you trouble, we will do your best to mediate and find a viable solution. Why The IRS Does Payment Plans At the fundamental level, the IRS sees payment plans as profitable. They want taxes in a reasonable amount of time, and a payment plan allows them to see staggered installments. The working theory is that the individual who owes taxes want to be honorable and honest, and an affordable amount means they will honor the debt. Thus, both parties will be happy. Now 99% of the time, we’ve been successful in helping taxpayers pay a reasonable monthly amount to the IRS without breaking their bank. However, there is that 1% where other solutions will need to be sought out because the IRS has denied a payment plan for one of our clients. They realize that the deal doesn’t benefit them, and they’d rather have the full amount on time. Reasons For Denying An IRS Payment Plan Bear in mind that we communicate with the IRS on our clients’ behalf. We arrange for all of the necessary documents to be presented to the IRS so that they can review your case. Even so, the IRS auditors are the ones who make the final decision. We are your mediators, messengers, and negotiators. But we cannot guarantee that an auditor decides to make a different decision. You can call the IRS to plead your case or fill out Form 9423 for an appeal. Even so, it may not be enough. The auditors are the decision makers. They can still reject you. The IRS rules also constantly change. We can keep up with the updates, but sometimes we get goalposts moved for our clients. All we can do is explain the possibilities that you cannot receive a payment plan, and we have to look into alternative solutions. It is essentially up to the IRS to determine the terms of your tax case. Technically,...

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When Does the IRS File Criminal Charges?

When Does the IRS File Criminal Charges?

By on Apr 29, 2019 in IRS | 0 comments

If you have been the subject of an IRS investigation or the IRS has been in touch with you about a potential audit, tax evasion or tax fraud, you should be aware of some basic facts regarding what the IRS can (and cannot) do in terms of filing criminal charges against you. Keep in mind that making an honest mistake on your taxes is not illegal and you will not mistakenly go to jail if that is what happened. The key here is to be knowledgeable and proactive and know when to get help. First off, remind yourself that IRS agents are not cops. They’re not deputized under any police banner and can’t come and arrest you. Employees of the IRS are in the same boat that anyone else who works for a regular government agency is. Would you ever scare yourself by saying that mail carriers or the Surgeon General were coming to take you away? Of course not! Take a deep breath and remember that making the right decisions with a cool head can help you walk away from a very difficult situation with a cleaner record than you had before. In fact, there’s a chance that you might not even be in as serious a situation as you think you are. Statistics for Being Prosecuted by the IRS When the IRS initiates contact with you over a serious matter (audit, tax evasion, tax fraud), you should definitely take note and be prepared to respond. But do not panic. It is actually very rare for an individual to be investigated for tax fraud (2%) and of those who are, only 20% are actually ever prosecuted (criminally or via a civil suit). Despite the low odds, you want to be aware of the process and the steps to take to avoid criminal charges. However, you do also want to keep these odds in mind. Chances are that you’re not going to actually even have to spend a single day in court if you take steps now to rectify the situation. It’s a safe bet that a majority of taxpayers who actually do get prosecuted were actively involved in stashing away money and trying to hide it from the...

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