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Frequently Asked Questions

Do I really need to hire a tax attorney?

There are important benefits to hiring a tax attorney rather than a CPA or Enrolled Agent. In the last twenty-five years there have been thousands of changes to the tax code. Tax Attorneys are trained to analyze the laws to ensure that taxpayers are being treated fairly and to make sure that all tax problems are resolved in the best manner for the taxpayer. In addition, only with an attorney will you have attorney-client privilege.

 

I have heard on TV that my liability can be resolved for pennies on the dollar. Is that true?

If a taxpayer cannot pay their liability in full without suffering a financial hardship they can submit an Offer in Compromise. An Offer in Compromise allows a taxpayer to settle their tax liability for less than the full amount owed. The IRS will usually accept an Offer in Compromise if the amount offered is equivalent to or greater than the taxpayers' reasonable collection potential.

Despite what you have heard on TV only a small number of cases can be settled by submitting an Offer in Compromise. The majority of Offers that are submitted are rejected. Our office will do a thorough financial analysis before we recommend the best collection alternative for you. We will not submit an Offer in Compromise unless we believe that there is a good chance that the Offer will be accepted.

 

Can the IRS levy my Social Security check?

Yes. The IRS is limited as to the amount they can take from your social security check, however, the amount they do take often leaves a taxpayer without enough funds to pay their necessary living expenses. Once a levy notice has been received you will have limited time to work out a collection alternative before the IRS begins taking a portion of your social security check.  Our office can help stop the levy or reduce the amount the IRS will take. Call or email our office to set up a free consultation.

 

Can the IRS take part of my paycheck?

Yes. After the IRS has met the three conditions necessary to proceed with a levy, they may proceed with a wage garnishment.

 

How much of my paycheck can the IRS take?

Yes. The amount the IRS can take varies depending on the taxpayer's circumstances. This can sometimes result in up to 70% of the taxpayer's wages going to the IRS. An experienced tax attorney can help get the amount lowered or in some cases have the wage garnishment stopped completely. Call or email our office to set up a free consultation.

 

The IRS has taken all the money in my bank account. Can I get it back?

When your bank receives a levy notice from the IRS they are required to freeze all the funds in any account at the bank with your name on it. This includes any joint accounts. They are required to hold the funds for 21 days before sending them to the IRS. During this three week period it is important for you to reach some type of collection alternative with the IRS. If you do not reach an agreement with the IRS within this 21 day window, the bank will send all the money in your accounts (up to the amount owed) to the IRS. Once the IRS receives the funds it is next to impossible to get the money returned. Call or email our office for assistance before the 21 days have passed.

 

I have been unable to modify my mortgage because the IRS has a lien on my home. Is there anything I can do?

If you are going to receive funds from a refinance or by modifying your mortgage you will have money available to pay towards your liability, the IRS will usually agree to a Certificate of Subordination. This means the IRS is agreeing to allow the mortgage company's lien to be senior to the IRS' lien. This is usually something that you can accomplish on your own without the assistance of a tax attorney, however, if you are having difficulty, call or email our office for assistance.

Depending on how much you owe, you can enter into an Installment Agreement with the IRS where you make your payments via direct debit and the IRS will remove the lien.

Attorney Campbell has extensive experience negotiating Installment Agreements with the IRS. Call or email our office to set up an appointment to discuss the options available to you.

 

How long do I need to keep my tax records?

You should keep your tax records for six years from the date you file your return. The IRS has three years to audit your tax return, however, there are two exceptions. In cases where a taxpayer has under reported their gross income by at least 25% the IRS has six years to audit their return and if the IRS suspects fraud there is no time limit.

 

Does the IRS ever agree to remove penalties and interest?

The IRS will agree to abate penalties if the taxpayer can show they had "reasonable cause" for not filing or paying their taxes. A business must show that they exercised ordinary business care and prudence. The IRS rarely agrees to remove interest. Usually they will only abate interest when the interest is the result of errors or delays on the part of the IRS.

For a small fee our office will request a penalty abatement for you. Call or email our office today to set up a free consultation to discuss if a penalty abatement is an appropriate option for you.

 

My husband has a tax liability from before we were married. Can the IRS come after me for what he owes?

You are not responsible for his liability in most states (there are some exceptions in community property states), however, the IRS may seize any assets that you own jointly. In the case of a joint bank account the IRS may seize the entire balance in the account not just your husband's share. The IRS may also take your entire tax refund and apply it to his liability if you file jointly. You would then need to file an injured spouse claim in order to get your share of the refund. To avoid this, if filing jointly, you will want to include Form 8379 Injured Spouse Allocation so that you will receive the share of the return that belongs to you.

 

end faq

10 Tips to Avoid an IRS Audit

This is a list of the best ways to avoid an IRS Audit:

1Double check for math errors: Making mathematical errors is one way to trigger an audit...

2Follow the directions on the forms, fill out all required spaces, and make sure your entries are legible: When filling out your return it is better to put in a zero or a dash mark...

3Be careful if you claim the home office deduction: The IRS has found that some taxpayers that claim the home office deduction tend to inflate their deductions...

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