Frequently Asked Questions
Welcome to the Frequently Asked Questions section of our website. This section is not intended to provide a comprehensive overview of all forms of tax debt relief available, but rather gives a summary of each of the Tax Relief Solutions referenced on our home page in the area titled “Other Types of Tax Relief Help Available” such as IRS back tax filings or Tax Penalty Abatement. You may need help with an IRS debt problem not covered here, so we encourage you to complete the short form at the right, and allow our tax advisors to help you.
Is help with IRS back tax filings available?
Yes, in fact, if you have not filed either your personal or your business tax returns, it is quite a serious matter. The first step in addressing this tax problem is to immediately prepare and file the back tax returns. We realize that oftentimes there may be missing information making it difficult to assemble accurate tax returns. Our tax specialists are equipped to handle missing records and still provide you with valuable help in preparing your back tax returns.
You may find yourself in a situation where the IRS has already filed “their version” of your tax returns for you. This is called an “SFR” or Substitute for Return. Clearly, the back tax filings completed by the IRS on your behalf will not attempt to identify any deductions you may be entitled to (beyond the standard deduction and one personal exemption). The IRS will be filing your back tax returns (SRFs) with the best interest of the federal government in mind. In fact, the IRS considers the non filing of tax returns so serious that it sometimes imposes penalties as high as 25% of the tax you owe. Additionally, all taxpayers should be aware that the failure to file tax returns may be construed as a criminal act by the IRS.
Once you have addressed and completed the back tax return filing process with our tax advisors, you will likely realize that payment of the back taxes is a heavy burden when you are required to remain current on your taxes during this same time period. This is another compelling reason to seek professional tax assistance. Back tax debt specialists are aware of the IRS relief programs available that may help relieve some of the hardship of paying your back taxes. Contact our tax advisors immediately so they can assist you with a tax relief strategy and stop your back tax debt problem from compounding over time!
What is IRS Tax Penalty Abatement?
IRS tax penalty abatement refers to the reduction or the removal of IRS tax penalties assessed. Typically this occurs because you fell behind on your taxes and the IRS exercised their right to charge penalties. When tax penalties and interest are assessed, the total tax you owe increases and so does the financial hardship you are undoubtedly already experiencing.
There is help available for an IRS tax penalty problem. The IRS is willing to review information about the reasons you either didn't file your taxes timely or underpaid your tax liability. Federal tax abatement specialists can review your situation, and if appropriate, will complete an IRS Penalty Abatement Request on your behalf. In some cases, it's discovered that IRS tax penalties were incorrectly assessed, and the taxpayer ends up owing no tax penalty at all. Even more encouraging is that an IRS tax abatement specialist may be able to secure a refund for prior IRS tax penalties remitted that were unfairly assessed by the IRS. The process to secure this tax penalty abatement requires that the proper forms be filed and specific IRS procedures be followed. It can be challenging to reduce IRS tax penalties or even secure a complete removal of penalties without expert tax help. Many states offer tax penalty abatement programs so do request help from a tax abatement specialist about any state tax penalty problems.
What is an Installment Agreement?
An IRS installment agreement is essentially a monthly payment plan which allows you to pay off your past due tax liability “over time”. Once you have been approved for an installment agreement the IRS will no longer continue to pursue you with their collection efforts. However, receiving this form of tax relief requires that you remain current with all your future tax filings and all your future payment obligations.
Is a Reinstatement of an Earned Income Credit possible?
If you claimed the Earned Income Credit (EIC) on a recent tax return, and have now found yourself in a position where the IRS has “disallowed it” and has either reduced your tax refund or is demanding repayment of the deduction you took for the EIC, let our tax advisors help you with this complex tax problem. Eligibility for the Earned Income Tax Credit is based on several factors and obviously you felt confident that you filed it correctly and were entitled to the EIC deduction. Insuring there is a successful reinstatement of your Earned Income Credit is best achieved by following the specific filing guidelines, using the proper forms, attempting to uncover and address the reasons the IRS has disallowed the EIC, and then tenaciously following up on a decision from the IRS.
What is an Innocent Spouse Claim?
An Innocent Spouse claim allows you to seek relief from joint tax debt with your spouse. A joint tax debt is defined as a “debt that both you and your spouse owe” and is the direct result of filing/signing a joint tax return. In filing a joint tax return, you have both indicated responsibility for the taxes due on that return. A later divorce does not “make this responsibility go away” for tax returns filed jointly during the marriage.
However, the IRS does recognize there may be extenuating circumstances related to the filing of a joint return that merit a review of the tax claim for Innocent Spouse Relief. There are three ways to quality for Innocent Spouse Relief and we recommend that an expert tax advisor review your unique tax situation to insure it is properly handled and that you are given your “best chance” to be granted this form of relief. If you do qualify, you may not have to pay all or even part of any income tax that may be owed from the filing of the joint return.