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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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Can the IRS Seize Your Bank Account Without Any Notice?

Can the IRS Seize Your Bank Account Without Any Notice?

By on Feb 27, 2019 in Bank account levy, IRS | 0 comments

If you owe the Internal Revenue Service (IRS), and they have attempted to contact you about this issue multiple times, and you’ve not responded, then yes, the IRS can seize your bank account. But the real question is: “Can they do this without any notice?” The answer is no. The IRS is supposed to give you several opportunities to pay your taxes. This is mainly done by mail. While other forms of communications can easily get hacked, and even some can impersonate an IRS representative over the phone, the good old fashion United States Postal Service still has proven to be reliable. Although, there are some scam artists who may also send mail disguised as the IRS. So if you’ve received a letter from the IRS, address it! Whether you think it’s legit or not, you’ll be better off verifying the document with the IRS first. Unfortunately, you may have to waste some of your valuable time doing this, but it’s better to make sure that the letter is valid rather than to assume it’s a scam. Either way, the IRS ought to be notified. Do keep in mind that you should contact the IRS directly regardless of whatever information was printed on the letter. There’s a chance that scammers might include some sort of bogus contact information. Uncle Sam, however, always lets you get in touch with the IRS on a relatively direct basis. That being said, you have to act fast in order to avoid incurring some kind of future penalty or the dreaded seizure of an important account. If you’re worried about whether or not the IRS will take money from your bank account, there are several steps that need to happen before that can take place. And a lot of that has to do with you not being negligent. If you prefer to avoid the IRS seizing money from your bank account to pay off your tax debt, there are a few things you can do to prevent this: 1) Communicate Believe it or not, the IRS appreciates it when you communicate with them and explain your situation. However, it’s certainly worth noting that there’s a fine line between explaining your financial situation so that...

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How to Resolve a Tax Dispute with the IRS

How to Resolve a Tax Dispute with the IRS

By on Feb 19, 2019 in IRS | 0 comments

If you disagree with the IRS about a decision they have made regarding your tax return, you may assume that you don’t have any chance of resolving it in your favor. Well, as it turns out, you may have a better chance than you might think – especially if you follow some basic tips and the following strategy. Here is how we suggest you resolve a tax dispute with the IRS: 1. Do Not Panic A dispute with the IRS can cause significant anxiety and stress, but it doesn’t have to. Of course, you already have a full plate before having to worry about a potential tax dispute. Recognize that a tax dispute is very often resolved in writing, without a face-to-face meeting. Keep in mind that getting all worked about the problem won’t solve it, and it could even make things worse by making you chose a bad decision somewhere along the way. 2. Read Carefully and Respond Quickly Generally, the best response, if you receive a notice or letter from the IRS disputing a part of your tax return, is to take the time to read the entire notice, making note of the action requested, date requested and information that is requested. Many disputes with the IRS can be resolved with very little effort if you follow the directions outlined in the notice. If you disagree with the notice, pull together any/all supporting documentation that you have (receipts, tax forms, etc.) and respond in writing by the deadline listed in the correspondence. While it might seem like the federal government has a tendency to drag its feet, you don’t want to do anything that might provide them with the freedom of moving even more slowly. Reply well in advance of this deadline if at all possible to ensure faster service. 3. Appeal If you do not agree with a decision or ruling made by the IRS, you have the right to appeal. You can appeal the results of an audit or a change made to an offer in compromise in which the IRS has increased the penalties and fees associated with your payment. You may qualify for mediation services through IRS programs like Fast Track Settlement (FTS),...

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