Tax Relief Blog

Preparation of Unfiled Tax Returns

Not filing a tax return is far worse than filing a tax return and not being able to pay the tax amount owed. Unfiled tax returns may even be considered a crime, with punishments of up to $25,000 in fines and a 1-year prison sentence for each unfiled tax year. Often taxpayers do not realize the seriousness of failing to file tax returns and avoid doing so because of financial hardships and an inability to pay taxes.

 

Unfiled returns should be prepared as soon as possible to limit the accumulation of penalties and compound interest. Direct Tax Relief (“DTR”) can prepare unfiled tax returns, using various substitute sources for any missing records. After tax returns are corrected, taxpayers can then complete further steps to reduce debt.

 

Have unfiled tax returns? Get on track with the IRS through Direct Tax Relief. Call today at (800) 505-4134 for your FREE Tax Resolution Analysis.

Penalty Abatement

The Internal Revenue Code allows penalties and the associated interest to be abated (removed) by the IRS if the taxpayer can show reasonable cause. Penalty abatement is often the first step in reducing sizeable tax debt and has the potential to lower the amount owed to the IRS by up to 30%. Even if your account is paid in full, the IRS will refund you the penalties and corresponding interest once your penalty abatement is approved.

 

Some examples of reasonable cause include:

  • Major family problems that you can prove, such as a divorce
  • Theft or destruction of your records and documents
  • A major illness to yourself or immediate family
  • Incarceration or a major disruption to your life
  • Bad advice from a tax expert
  • A natural disaster (hurricane, windstorm, fire, flooding, riot, etc.)
  • Lengthy time of unemployment
  • Death of a close family member
 

Three of the most common penalties that are assessed to individual taxpayers by the IRS are Failure to File, Failure to Pay and Failure to Pre-Pay Taxes.

  • Failure to File Penalty is calculated based on the period from the due date of your tax return (including any valid extensions) to the date the return is filed by the taxpayer.
  • Failure to Pay Penalty is calculated based on the amount of tax owed. The penalty is calculated from the original payment date of April 15. Many taxpayers are not aware that an IRS extension obtained by April 15 is only an extension to file; it does not give the taxpayer additional time to pay the tax liability.
  • Failure to Pre-Pay Tax Penalty is assessed when proper estimated tax payments are not made throughout the year. Estimated taxes are quarterly payments mailed to the IRS for taxpayers who are self-employed or any taxpayer who does not have sufficient withholdings taken from their income sources.
 

Don’t pay the IRS any more than necessary. See if you qualify for a penalty abatement by calling (800) 505-4134 for your FREE Tax Resolution Analysis.

Offer in Compromise

An Offer in Compromise (OIC) is a formal agreement between a taxpayer and the IRS that settles the taxpayer’s debt for less than the full amount owed. It allows taxpayers who cannot afford to pay their delinquent tax liability the opportunity to settle permanently for a reduced amount. If an OIC is not prepared or submitted correctly or if the taxpayer is not in compliance, the IRS can and will reject an OIC.

 

During your initial FREE consultation, our tax consultants complete a detailed financial interview with you to determine if an OIC can be pursued. Once you have been assigned a tax attorney, they will perform a comprehensive review of your case to confirm that your account is in compliance with the IRS. After an OIC is filed, your tax attorney will work to negotiate with the IRS on your behalf to achieve the lowest settlement possible.

 

If you cannot pay your tax debt in full, the OIC program is for you. The OIC program has given countless taxpayers the opportunity for a fresh start, enabling them to get back on track with their lives.

 

Call Direct Tax Relief today at (800) 505-4134 for your FREE Tax Resolution Analysis.

Payroll Tax Resolution

Employers are responsible for withholding several types of payroll taxes (often referred to as 941 or 944 taxes) from employees. These withholdings include federal income tax, Social Security tax and Medicare tax. Businesses are also required to match the Social Security and Medicare portion of these taxes. Because these funds have already been withheld from employees, the IRS takes payroll tax debt very seriously. Unpaid payroll taxes can result in fines and even business asset seizures (like equipment, automobiles, bank accounts and accounts receivables).

 

Often employers facing unpaid payroll tax debt can feel overwhelmed by IRS harassment, the debt amount (including fees and fines) and the mounds of paperwork needed to rectify payroll tax debt. That is why it can be crucial to have a knowledgeable and dedicated tax attorney on your side.

 

Don’t risk the loss of your business to the IRS. Call Direct Tax Relief today at (800) 505-4134 for your FREE Tax Resolution Analysis.

Installment Agreement

One of the main functions of the IRS is to assess and collect all federal income taxes due. With government support and financial backing, the IRS is essentially the world’s largest and most powerful collection agency, with the power to seize bank accounts, garnish paychecks and sell assets to settle tax debt.

 

Through an IRS installment agreement, taxpayers can begin to pay down back taxes. Keep in mind, the goal of the IRS is to collect owed debts as soon as possible. Often this can lead to exorbitant payments for tax debtors. With an experienced tax attorney, these back taxes can be negotiated to allow for agreeable (and realistic) payment terms.

 

Put an end to IRS harassment and the threat of wage garnishments, asset seizures and bank levies.

 

Find out if an installment agreement is right for you by calling Direct Tax Relief at (800) 505-4134 for your FREE Tax Resolution Analysis.

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