Unresolved tax liabilities can create serious financial hardships for taxpayers at any income level. Fortunately, there are several ways for a taxpayer to approach the situation if he or she is excessively burdened by tax debts. Depending on the situation, it may be appropriate for the taxpayer to consider various options for tax debt relief, which could potentially include installment agreements, offers in compromise (OIC), innocent spouse relief, or even filing for personal tax motivated bankruptcy, though debtors should be advised that tax-related debts are dischargeable only under limited circumstances. Read on to learn more about obtaining relief from state or federal tax debts – and if you think that debt relief could be right for you, be sure to contact our experienced tax relief attorneys for a confidential, reduced-rate consultation about how we can assist.
When to Consider a Tax Debt Relief Program
There are at least four reasons to seriously consider seeking tax debt relief. If any of the following describe your current situation, you should consult a tax debt attorney immediately:
- You are facing an audit, such as an IRS tax audit by the Internal Revenue Service, or a California sales tax audit.
- You have not filed all of your tax returns to date, including federal and California unfiled returns. This may mean that you also owe “back taxes” (unpaid taxes from previous years).
- You currently owe taxes that you cannot afford to pay, whether to the IRS or the state of California.
- You are out of compliance with the Internal Revenue Code (U.S. Tax Code) and/or California Revenue and Taxation Code. For example, you may have forgotten to file taxes or, if you’re an employer, misclassified your employees as independent contractors to avoid tax liabilities.
It is critical to emphasize that ignoring your past-due balances, whether owed to federal or state taxing authorities, will only exacerbate your situation. If you have recently received a collection notice from the IRS or FTB, the time to act is now – before the pertinent tax authority initiates collections. Swift action may prevent the matter from escalating to more aggressive and disruptive collection efforts, which can include:
These levies may be compounded by consequences like asset seizure, wage garnishment, and tax liens. (For more information on the latter, see our article on how to remove an IRS tax lien.)
How an Experienced Tax Lawyer Can Help
In many cases, problems arise because taxpayers are unaware of the rigid deadlines that govern IRS collection notices. Thus, it is imperative to consult an experienced tax lawyer as early as possible in the process.
Another benefit of being proactive is that it may leave more remedies open. Conversely, the longer the taxpayer delays, the more options will begin to close off – and the more aggressive the collection actions will become. An experienced tax debt professional can ensure that the taxpayer’s rights and best interests are being guarded and upheld by negotiating aggressively and exploring approaches that the taxpayer might otherwise be unaware of. For example, an attorney can help to determine your eligibility for various tax relief programs, manage your IRS tax forms and other documentation, prepare you for interviews and hearings, handle negotiating with the IRS on your behalf, and ensure that your rights are not being violated by private debt collection companies, which the IRS sometimes works with, and which are generally subject to the Fair Debt Collection Practices Act (FDCPA).
There may be several strategies that the tax professionals at the Tax Law Office of David W. Klasing can pursue on your behalf. Depending on eligibility, it may be possible to:
- Arrange a payment plan with the IRS, which can help you get current without needing to worry about levies or property seizure.
- Make a settlement with the federal government, such as an Offer in Compromise “OIC”, which often enables the taxpayer to pay substantially less than what is actually owed.
Avoiding Tax Debt Relief Scams
Tax debt relief is a valid and legitimate service. (On this page, for example, the IRS links to numerous options for taxpayers with outstanding tax debts, such as IRS payment plans and offers in compromise.) That being said, taxpayers need to be wary of unethical or inexperienced tax professionals and accounting firms, which tend to create more problems than they solve. Gratuitous fees, poor customer service, generic “guidance,” lack of training, and other issues can combine to make the taxpayer’s situation worse.
Fortunately, taxpayers can avoid getting into this situation by conducting some basic research. For instance, it is prudent to check the business’ accreditation and rating with the Better Business Bureau (BBB), which ranks thousands of CPAs, tax attorneys, and accounting firms across the United States. The Tax Law Office of David W. Klasing is pleased to report that we have earned a perfect A+ rating from the BBB – perhaps due to our decades of tax law experience, our versatile range of practice areas and professional backgrounds, or our unwavering commitment to zealous client representation.
Get Relief from Tax Debts with Help from an Attorney-CPA
There are numerous reasons a taxpayer might find himself or herself faced with considerable tax debts – yet little or no means to pay them off in a timely fashion. While this is a stressful situation to be in, the good news is that financial relief may be within reach. However, because meticulous planning is essential to mitigate losses and penalties to the greatest extent possible, taxpayers should always consult with an experienced tax attorney before proceeding.
Whether you owe debts to state tax bodies like the California Franchise Tax Board, federal tax authorities like the IRS, or both, help is only a quick phone call or submission form away. To learn more about your options in a reduced-rate tax consultation, contact the Tax Law Office of David W. Klasing online, or call (800) 681-1295 to get started.
Also, we’ve expanded our offices! In addition to our offices in Irvine and Los Angeles, the Tax Law Offices of David W. Klasing now have offices in San Bernardino, Santa Barbara, Panorama City, and Oxnard! You can find information on all of our offices here.
Helpful collections Q and A content:
https://klasing-associates.com/topics/innocent-spouse-relief-faq/
https://klasing-associates.com/topics/liens-levys-garnishments/
https://klasing-associates.com/topics/offer-in-compromise-faq/
Here is a link to our YouTube channel: click here!
Common issues with IRS collection actions
https://www.youtube.com/watch?v=PYaLOWpLdEo
What are common tax issues that nonfilers face
