Minneapolis Tax Lawyer

There can be severe consequences to having unresolved problems with the IRS. The IRS is allowed to levy (seize) funds from your paycheck of bank account(s).

There are many ways to keep the consequences to a minimum. The first is called Offer in Compromise. To settle their tax debt in full, taxayers can use this Congress-mandated program. The taxpayer can make an offer to 'settle for less' and the IRS would determine the amount. Once there is an offer pending, the IRS will not levy your property. The offer can be one of three different types.

The first is Doubt as to Liability. What is in question here is whether the taxpayer lawfully owes the debt.

The second offer type that comes under this category is Doubt as to Collectability. This is the most common type of offer made in an Offer of Compromise.

The name of the third type of compromise is Effective Tax Administration. This is a rare offer in terms of acceptance by the IRS. It is designed for taxpayers whom the IRS feels can afford to pay their debt and applies when there may be some mitigating circumstances.

There is a fairly well-kept secret that constitutes the second basic way to resolve IRS difficulties. The IRS must collect the income tax within a specific amount of time. Generally ten years from assessment of the tax, the Collection Statute Expiration Date (CSED) occurs. It is sometimes possible to wait for the elapse of this date.

A third way of resolving IRS problems occurs when a taxpayer has no ability to pay. When this happen, the taxpayer's account goes into Currently Not Collectible Status. It is also called Status 53, as the number 53 corresponds to the screen number that an IRS employee sees upon not collectible status being implemented. When in Status 53, your debt is placed in 'hardship' category, and the collection statute continues to count down.

You can set up, as your fourth alternative, a payment plan or installment agreement. This is just what it sounds like.

The fifth method of obtaining relief from IRS issues is available via bankruptcy (in Chapter 13). Some of the taxes and penalties or interest levied by the IRS may be discharged in this case.

Your sixth option is penalty abatement. This is forgiveness by requesting a cancellation of penalties. The original tax debt is still owed.

The last method is Innocent Spouse Relief. If your spouse or former spouse failed to report income, reported income improperly or claimed improper deductions or credits, you may be entitled to relief from an IRS debt.

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.