Melbourne Tax Lawyer

Having unresolved problems with the IRS can lead to severe consequences. If one does not address the matter, the IRS can eventually levy (seize) assets from your paycheck or bank account(s).

There are a number of ways to keep this from happening. Offer in Compromise is the first method we will look at. There is a Congress-mandated program that allows taxpayers to try to make an offer to settle their tax debt in full. This is an offer based on amount calculated by the IRS and may be for less than the total amount originally due. The IRS will no longer levy your property once there is an offer pending. There are three basic forms of this type of offer.

The first of these is Doubt as to Liability. The lawfulness of the debt is what is in question here.

The second of these is called Doubt as to Collectability. This is the most common type of offer and what people typically think of when they think of an Offer in Compromise.

The third type of compromise is called Effective Tax Administration. This type of offer is one of the most rarely accepted by the IRS. 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 fairly well-kept secret that is the second basic way of resolving problems with the IRS. The IRS must collect the income tax within a specific amount of time. The Collection Statute Expiration Date (CSED) usually occurs ten years from assessment of the original tax debt. It is possible to simply wait this out.

The third way to handle IRS difficulties applies if a taxpayer has no ability to pay (according to the IRS' analysis). The debt, in this case, is put into a status called Currently Not Collectible. Status 53 refers to the screen number of Currently Not Collectible Status at the IRS. When in Status 53, your debt is placed in 'hardship' category, and the collection statute continues to count down.

The fourth alternative is to set up an installment agreement of payment plan. This is fairly straightforward.

The fifth method of obtaining relief from IRS issues is available via bankruptcy (in Chapter 13). In this case, some of the taxes and penalties are dischargeable, and those that are not may be paid without interest.

Penalty abatement is the sixth of your options. This is cancellation of any penalties that have been incurred. You must still fully pay your original tax debt.

The last of our seven methods is Innocent Spouse Relief. Under specific circumstances, taxes due by a former or current spouse can be forgiven.

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.