Sacramento Tax Advice

You do not want to have unresolved problems with the IRS. The IRS can even seize funds from your paycheck or bank account(s) if you fail to address the matter.

You can keep consequences to a minimum in any one of a number of ways. One way is referred to as making an Offer in Compromise. Taxpayers have the option to settle their tax debt in full via this Congress-mandated program. The offer the taxpayer makes can be for less than the full amount owed, but it is calculated by the IRS. Once there is an offer pending, the IRS will not levy your property. This offer can be in one of three basic forms.

Doubt as to Liability is the first of these. Whether the taxpayer lawfully owes the money at all is what is in question here.

Doubt as to Collectability is the second type of offer. When you think of an Offer in Compromise, this is typically what you would refer to.

Effective Tax Administration is the third type of compromise. It is a rare event when the IRS accepts this type of offer. In this type of settlement, it is determined that the taxpayer can afford to pay but that there would be some difficulty in the procedure.

There is a second way of resolving IRS issues, and it is actually a fairly well-kept secret. It is based on the time limit for the collection of income tax. There is something called a Collection Statute Expiration Date (CSED), which is generally ten years. Sometimes, you can simply sit and wait.

The third way to handle IRS difficulties applies if a taxpayer has no ability to pay (according to the IRS' analysis). Currently Not Collectible is the name of the status of this situation. Status 53 refers to the screen number of Currently Not Collectible Status at the IRS. During the time you are in this status, your debt is in the hardship category and the collection statute continues to run.

Setting up a payment plan or installment agreement is the fourth alternative. This is just what it sounds like.

Another method of obtaining relief from IRS tax debt is via bankruptcy. If you have filed for bankruptcy, some of the taxes and penalties are dischargeable and those that can't be may be paid without interest.

Penalty abatement is your sixth option. Cancellation of any penalties is what this actually is. You must still fully pay your original tax debt.

The last method is Innocent Spouse Relief. Here, taxes due by a former or current spouse may be forgiven under particular circumstances.

When you are ready to resolve your IRS problems, you are well advised to seek professional assistance.

American Tax Lawyer, Darrin T. Mish represents taxpayers all over the United States and on every inhabited continent. His many years of experience in dealing with tax problems benefit clients tremendously. For more information, visit http//americantaxlawyer.com. Darrin may be reached by calling toll free (888) 438-6474.