Regular Post
Written by Scott Allen

What is an SFR return and the purpose of the SFR Unit?

IRS SFR Return help near Gilbert Arizona

SFR stands for substitute for return.  When a tax return has not been file for an extended period of time, the IRS will eventually file a substitute return that calculates the tax based on income reported with no deductions.  If a person was filing jointly before, the IRS will file the SFR return as married filing separate.  The purpose of the SFR unit is to prepare the substitute return and process any returns that are later filed as a “protest” against the SFR return by the taxpayer.  When filing a return in response to an SFR, it is best to send it to the SFR unit that is responsible for making any adjustments to the SFR amount owed.  The turn around time to get a tax balance lowered after filing a correct return can take several months.  SFR returns are not dischargeable in a bankruptcy since they are not considered filed returns.  However the SFR does have the same 10 statute of limitations for collection as a return filed by a taxpayer.

Before making any decisions on how to handle an IRS SFR return near Gilbert Arizona it is critical to first discuss your situation with a tax professional.

Scott Allen E. A. at 480-926-9300

Tax Debt Advisors, Inc near Gilbert Arizona

taxdebtadvisors.com

 

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What is a hardship status with the IRS?

IRS Hardship Status Tempe Arizona

The IRS will stop collection action if you can show economic hardship.  That doesn’t mean that the tax or the interest and penalties on the tax go away.  You still owe the IRS, they are just not requiring you to make any payment towards the debt owed.  Currently not collectible is referred to as status 53 at the IRS.

To qualify for IRS hardship status Tempe Arizona the IRS will collect financial information about your monthly income and expenses.  If your income and monthly expenses are close to being equal the IRS will consider you currently not collectible.  However, the IRS has certain amounts that they consider reasonable for expenses.  For example, the IRS feels that you car payment should be $588 per month or less.  If your car payment is $800, the IRS will not allow you to be put on a hardship status.  To be fair, the IRS can’t allow someone with a nice car be on a hardship status while the taxpayer with a car within their acceptable limit be required to make monthly payments on their IRS debt.

Qualifying for IRS hardship status Tempe Arizona is rather common.  If the statute of limitations is close to running out, being put on status 53 is an excellent settlement strategy.  The statute of limitation runs for 10 years from the time the taxes were assessed.  We have had many clients that have stayed on currently not collectible status for the full ten years.  To stay on this status one must file and full pay their current taxes every year.

Scott Allen E. A.

Tax Debt Advisors, Inc

www.scottallenea.com

 

IRS Levy, IRS Problems, Tax Advisor
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4
Regular Post
Written by Scott Allen

Tax Evasion

Tax Evasion

Tax evasion is a crime that is punishable with asset seizure, fines and imprisonment.  The temptation to underreport income occurs with self-employed cash intensive businesses.  Tax fraud can also involve using a fake or false social security number, claiming to many dependents on your tax return and falsifying your accounting records.

Don’t assume that when you get a letter to be audited that the IRS suspects tax fraud.  Most audits generate some adjustments to the tax amount owed.  Auditors are trained to know the difference between tax evasion and honest mistakes.

If you are found guilty of tax evasion, you will not only have the tax, interest and penalties added but also the expenses of the cost to prosecute your case in court.  This situation is one in which the services of a tax attorney is highly recommended.  The attorney you select should have a majority of his or her practice with tax evasion case work.

If you suspect or know that you are guilty of tax evasion, it is best to tell the IRS right up front that you want to have legal representation.  The IRS will agree to you right to be represented by an attorney.  Who you pick to represent you is very important.  Someone who is respected by the IRS as well as the Judge will have a greater chance of reducing the chances of imprisonment.  We can recommend an attorney that you can trust and have confidence will represent you in the best possible manner.

Scott Allen E. A.

Tax Debt Advisors, Inc

www.IRShelpblog.com

 

IRS help by state, IRS Problems, IRS Tax Attorney
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6
Regular Post
Written by Scott Allen

Are You Losing Your IRS Refunds Every Year?

Losing IRS Refunds

Are you getting tired of having refunds every year applied towards your unpaid taxes?  The solution is rather simple.  If you are an employee, change your withholdings so that you are having less withheld.  I always tell clients in this situation that the best you can do is own $1 on future tax returns.  When you have refunds you are in essence making an interest free loan on the money to the government.

Secondly, if you are married and filing jointly, you can protect your refund by filing an Injured Spouse Allocation—form 8379.  This will allow you to calculate how much of the refund was generated by you and you can have it paid to you rather than have it applied to a debt that is not yours.  Too many taxpayers are filing married filing separate to protect the injured spouse’s refund.  This is a very expensive way to protect a refund.  Many deductions and credits are lost by filing married filing separately and the taxpayer would get more of a refund filing a joint return with the Injured Spouse Allocation.

Scott Allen E. A.

Tax Debt Advisors, Inc

www.taxdebtadvisors.com

 

IRS Appeals, IRS Problems, Tax Debt, Unfiled Tax Returns
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Regular Post
Written by Scott Allen

Is my spouse responsible for my LLC tax debts?

LLC Tax Debts

The answer to this question depends on the fact and circumstances of each individual situation.  There are times when a spouse would not be responsible and there are other situations where the spouse is definitely responsible.

Here are some circumstances that would be factors:

Arizona is a community property state.  That means that both the IRS and the Arizona Department of Revenue can consider the income from both spouses to be considered earned 50/50 by each spouse even if they file separate returns.

LLC’s can be taxed as sole proprietorships, partnerships, C corporations or S corporations.  The type of entity you have elected to be taxed as will have an impact of a spouse’s liability of the LLC tax debt.

The type of tax is critical.  If it is payroll taxes and the spouse was preparing the payroll and had check signing authority would make the spouse responsible even if they were not an actual owner of the business.

Ownership is also a critical factor.  If both spouses are listed as owners and/or officers, then the likelihood of both spouses being held responsible for the taxes is most likely.

Dates of marriage and/or divorce of the marriage will affect the chances of the “innocent spouse” being held responsible or not responsible for LLC tax debts.

There are many other factors that can affect the spouse’s responsibility for tax debt.  It is best to consult with a knowledgeable tax representative to get a specific answer based upon the facts and circumstances of your situation.

Scott Allen E. A.

Tax Debt Advisors, Inc

www.taxdebtadvisors.com

 

IRS Problems, Payroll Tax Problems, Tax Debt
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Regular Post
Written by Scott Allen

Beware of “IRS” Phishing and Email Scams

IRS Phishing and Email Scams

The IRS does not request personal or financial information including your social security number over Internet.  If the IRS needs information from you it will be done by letter.

Phishing is when you are given a link in an email that looks like it was from the IRS requesting financial information to be entered.  Avoid these and report anything suspicious to phising@irs.gov. 

Likewise, if you get an email from the IRS requesting a reply with your social security number or other financial information—ignore it and report it to the IRS.  These email can look official with IRS logos and letterhead.

Scott Allen E. A.

Tax Debt Advisors, Inc

www.stopIRSaction.com

 

IRS help by city, IRS Help By Profession, IRS Problems
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Regular Post
Written by Scott Allen

Arizona State tax debt

Arizona State Tax Debt

Debts owe to the State of Arizona are handled by the Arizona Department of Revenue.  Settlements and are handled very much the same way as they are with the IRS.  There are some important differences.  I advise clients to first file and settle with the IRS and then file and settle with the Arizona Dept. of Revenue (AZDOR) in most cases.  If you are filing old returns from prior years, Arizona will often wait until the IRS accepts the federal return before accepting a return filed with them for the same year.  Also, the State of Arizona is much more aggressive on collecting taxes on smaller amounts owed than the IRS is on larger amounts owed.

It is best to make your decisions on settlement once you know what you will owe to both the IRS and AZDOR and your ability to make payments on your combined tax debt.  There are some situations when settling up with the State before settling with the IRS makes more sense.  A consultation with a professional representative will help avoid painting yourself in a corner on one tax debt and leave you vulnerable to serious financial troubles in dealing with the other.

Scott Allen E. A.

Tax Debt Advisors, Inc

www.stopIRSaction.com

 

IRS Problems, IRS Tax Payment Plan, Unfiled Tax Returns
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Regular Post
Written by Scott Allen

Phoenix IRS Offer in Compromise vs. filing tax court petition

Phoenix IRS Offer in Compromise

If you have the opportunity to file a tax court petition or a Phoenix IRS offer in compromise—always file the tax court petition.  An offer will take a long time to process and it is doubtful that you will know the amount of the offer that will ultimately be acceptable to the IRS.  The filing period for a tax court petition is only 90 days.  You will not know the results of an offer before the deadline on the tax court petition will lapse.  If you are working with a competent representative you should know what you will be expected to pay on your tax court petition.  Also, you should never or almost never expect to go to tax court.  Your advisor should get your case assigned locally to the Appeals Office at the IRS.  This is one area that you should most definitely consult with a representative to know your options under both situations before getting started.

Scott Allen E. A.

Tax Debt Advisors, Inc for Phoenix IRS Offer in Compromise

www.IRShelpblog.com

 

IRS Levy, IRS Problems, Unfiled Tax Returns
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Regular Post
Written by Scott Allen

What is the average IRS settlement Queen Creek Arizona?

IRS Settlement Queen Creek Arizona

There are several different ways to get an IRS Settlement Queen Creek Arizona ?  I am always uncomfortable quoting or giving averages when it comes to settling up with the IRS.  Here is why.  If you are talking about a settlement with an Offer in Compromise, over 98% of the clients who come in don’t qualify for this type of a settlement for various reasons.  So what good is an average when you are only talking about 2%.  We have had some offers for as low as ½ cent on the dollar up to 88 cents on the dollar.  If those were the only two offers, saying the average is 44 cents on the dollar is a ridiculous statement.  For one it would be 8,800% too high and the other 50% too low.  I suppose an average of 15% might be reasonable on all of the Offer in Compromises we have had accepted for clients.

If a client discharges their taxes under the Chapter 7 rules of bankruptcy then the settlement is zero.  It is always zero.  How do you give an average here other than to say our average settlement is zero if you choose to settle your IRS debt using a Chapter 7 bankruptcy?  There is no average, it is always the same.

The best thing to do is to come in and find out what your IRS settlement Queen Creek Arizona would be rather than rely on an average which will more than likely be much different than what you will ultimately receive.  Once I know how much you owe the IRS, how long you have owed the IRS, and have some financial information, I can tell you what you can expect under all the options that are available to settle with the IRS.  And that information will be much more valuable to you than an average from previous clients whose financial ability to pay on the amount owed that never matches your particular situation.

I like to tell clients that if you were a manager of a baseball team and you had two choices—send up a batter with a one in three chance of getting a hit or one you knew would get a hit, which would you choose?  Obvious, you would go with the one you knew was going to get a hit.  That is what you can expect from me.  I will tell you what settlement you will get from the IRS, once I know the facts.  Don’t ever take a chance on relying on averages when you can know the answer with just a little more time and effort.  Practitioners who quote averages will always use that inappropriately to get you to use them and then when it doesn’t happen, will always use it to say, “Well, I was only giving you an average, your settlement is much higher now that I know the facts.”  The best advice is to know the facts not the averages.

Scott Allen E. A.

Tax Debt Advisors, Inc offering IRS settlement Queen Creek Arizona

www.stopIRSaction.com

 

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Written by Scott Allen

Can someone actually get out of IRS tax debt in Arizona?

IRS Tax Debt in Arizona

The answer is yes, but some ways are easier than others.  Let’s face a few facts.  Some clients spent several years getting into tax trouble and are unrealistic to think that  there is a magic pill or potion that will instantly make the problem go away without any pain or effort.

A short story may be helpful.  One day my father took me over to my grandmother’s house to pull some weeds.  I had previously asked him if I could go to the beach with some friends that day.  When I saw the half acre with weeds up to my waste, I was convinced that there was no way I was going to be able to pull those weeds and go to the beach.  My father drove away and left me there.  He was gone for about 30 minutes and had returned to see what I had accomplished.  I had not pulled any weeds—not one.

Now I was told in no uncertain terms that I need to start the project and he would come back in 30 minutes to see how I was doing.  I reluctantly started the process.  I pulled one weed and it came out pretty easily.  The next pull I was able to get two weeds with just one hand.  Eventually I was able to get about ten weeds in one hand, then I figured out how to get both hands working and was pulling out twenty weeds with two hands.  When my father came back in 30 minutes, I was half done.  I was shocked at how much I had accomplished.  My father had taught me a very valuable lesson that day.  “One weed at a time.”  The project was completed in less than an hour.  If you had asked me how long it would have taken me to do that job, I would have guessed three days.

It is the same with IRS tax debt in Arizona.  I ask my clients to do one task at a time and to keep moving forward and before they know it, their IRS problem will be done.  The vast majority of clients say, “If I knew it was going to be that easy, I would have started this process a long time ago.”  I remind them that it wasn’t an easy process.  It became easier once they started.  That is the hard part—getting started and staying committed to the task.  Goethe said it best when he stated, “Are you in earnest?  Seize this very minute—Boldness has genius, power and magic in it.  Only engage, and then the mind is strengthened.  Begin it, and then the work will be completed.” 

This is true with your IRS tax debt in Arizona.  Do you earnestly want to get it resolved?  If so then engage in the process, begin the task, and as soon as you begin it you are half completed.  The second half will be easier to complete once you realize you are half done already.  A tax problem and a half acre of weeds had a lot in common.  With a one hour free initial consultation I can tell you what it will take to get your IRS “weeds” out of your life.

Scott Allen E. A.

Tax Debt Advisors, Inc

www.stopIRSaction.com

 

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