Denver Tax Settlement

There can be severe consequences to having unresolved problems with the IRS. Failing to address the matter can result in the IRS putting a levy (seize) your assets - from your paycheck or bank account(s).

There are a number of ways you can keep this from occurring. Offer in Compromise is the first method we will look at. This is a program mandated by Congress that allows taxpayers the option of making an offer to settle their tax debt in full. The IRS can calculate an amount less than the full payment originally deemed due. The IRS will no longer levy your property once there is an offer pending. This offer can be in one of three basic forms.

The first of these is Doubt as to Liability. One makes this type of offer only when there are questions as to whether the debt is lawfully owed.

The second offer type that comes under this category is 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. It is for taxpayers who can afford to pay (at least on paper) but forcing them to do so would be difficult.

There is a second way of resolving IRS issues, and it is actually a fairly well-kept secret. There is a time limit for the collection of income tax by the IRS. Generally ten years from assessment of the tax, the Collection Statute Expiration Date (CSED) occurs. It is possible to simply wait this out.

When a taxpayer is deemed by the IRS to have an inability to pay, this third way of settling the debt can be implemented. When this happen, the taxpayer's account goes into Currently Not Collectible Status. There is another name for this, Status 53, and it refers to the screen number an IRS employee is looking at. Although the collection statute continues to run, a taxpayer's 'debt' is put into hardship status for a year at a time under this Status.

The fourth alternative to handling unresolved IRS issues is to set up an installment agreement (payment plan). This is fairly straightforward.

Another method of obtaining relief from IRS tax debt is via bankruptcy. Some of the taxes and penalties or interest levied by the IRS may be discharged in this case.

Your sixth option is penalty abatement. In penalty abatement, quite simply, you are asking for those to be cancelled. You still owe your original debt.

Finally, there is what is referred to as Innocent Spouse Relief. Failure of a current or former spouse to file or pay taxes can be forgiven.

Although some of these 'methods' may seem simple to implement, you are well advised to seek professional assistance when dealing with the IRS.

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.