Regular Post
Written by Scott Allen

I am being audited and have lost my records: Help!

Do I need a Mesa Arizona IRS Attorney when I don’t have proof of deductions?

Often taxpayers know that they have legitimate deductions but when audited cannot provide proof of the deductions because their documentation is inadequate in the opinion of the IRS auditor.  For example a taxpayer may have a cancelled check but doesn’t have the receipt to prove the expense was a deductible item.  This is not a criminal issue and does not require the need for an IRS Tax Attorney in Mesa AZ.  This can often be reversed by using an Enrolled Agent such as Scott Allen E.A.  One example that actually occurred shows one of many ways to validate deductions without proof of the expense.  One of Scott’s clients was a truck driver who lost his gas receipts or never kept them—it doesn’t matter.  His client was paid per mile he drove his truck by his company.  It is known with a high degree of accuracy the miles per gallon the truck gets over a year’s time.  It is simple math to calculate the number of gallons of diesel needed to drive the miles he was paid.  Over a year’s time an average price per gallon can be estimated.  In this case the IRS auditor was unwilling to budge and allow the deduction.  However, it was allowed by the Appeals Officer when Scott requested an Appeals Hearing.  The IRS Appeals Office has much more latitude of allowing deductions than auditors.

If you have a situation where an IRS auditor disallows deductions because you cannot provide them adequate documentation, contact Scott Allen E.A. at 480-926-9300 for a free consultation to determine what options are available in your case.  Using a Mesa AZ IRS Attorney in this situation is not warranted and will only cost you more in legal fees to get your IRS matter resolved.

 

IRS Appeals, IRS Problems, IRS Tax Audits
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Regular Post
Written by Scott Allen

How long before the IRS discovers I have unfiled tax returns? From Tax Debt Advisors, Inc.

“I have unfiled tax returns…”

It may take several years before the IRS will contact you regarding unfiled tax returns.  However this works against you.  The interest and penalties on unfiled returns can double the amount you owe in just a few years.  As time goes by many records that can reduce your liability have been lost.  Your memory of what happened several years ago will fade and you will likely pay much more on your taxes if you had filed returns sooner.  Many clients miss one year and when nothing happens another year goes by and then another.  Before you know it six or seven years has passed and your tax problem will be getting more difficult to deal with each deadline missed.  There is also a serious psychological burden carried when you have unfiled tax returns.  You know that a day of reckoning will come and decisions that can be made are postponed and opportunities will be permanently lost.  Time is never on your side when you have unfiled tax returns.  By filing returns on time even if you do not have the money to pay taxes owed is far better than not filing and taking on additional penalties and interest.  Call me today for a free confidential initial consultation to get started.

 Scott Allen, E.A. – Tax Debt Advisors, Inc for unfiled tax returns in Arizona

www.TaxDebtAdvisors.com

 

BACK TAX RETURNS, IRS Problems, Tax Preparation, Unfiled Tax Returns
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Regular Post
Written by Scott Allen

Are taxes discharged in bankruptcy taxable as forgiveness of debt? From Tax Debt Advisors, Inc.

Discharge IRS taxes in bankruptcy

No tax debt discharged in bankruptcy is considered cancellation of debt and will not be considered income to be reported on your tax return.  However, creditors who elect to cancel their debt can cause it to be taxable by filing IRS Form 1099-C.  Usually the full amount cancelled is taxable income unless you can prove that you were insolvent when the debt was cancelled.

If you decide to file a bankruptcy, I will prepare current documentation that will allow you to avoid paying taxes on forgiveness of debt, IF YOU ARE INSOLVENT.

Almost every client who files a bankruptcy is insolvent but to wait until the following year will make the process of proving insolvency more difficult.

Scott Allen, E.A. – Tax Debt Advisors, Inc

www.TaxDebtAdvisors.com

 

 

IRS Problems, IRS Tax Audits, Tax Bankruptcy
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Regular Post
Written by Scott Allen

Can I appeal what the IRS says I owe? From Tax Debt Advisors, Inc.

Appeal what the IRS says I owe

Yes, but there are procedures that need to be followed exactly and timely to get appropriate relief.  There are two kinds of appeals.

The first is a Collection Due Process (CDP) appeal which is filed on IRS Form 12153.  This appeal is used when you have received an IRS Notice of Federal Tax Lien, a Final Notice of Intent of Levy or a Levy on your state refund.

The second is a Collection Appeals Program (CAP) which is filed on IRS Form 9423.  This is appeal is used when the IRS rejects your proposed installment agreement, termination of your installment agreement, when the IRS levies or seizes your property and when the IRS files a Notice of Federal Tax Lien.

Call me today if you are facing any of these threatening IRS actions to schedule a free consultation on how I can help you appeal your case.

 Scott Allen, E.A. – Tax Debt Advisors, Inc

Phone:  480-926-9300

www.TaxDebtAdvisors.com

 

Income Tax Preparation, IRS Appeals, IRS Problems, Tax Preparation
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Regular Post
Written by Scott Allen

STOP IRS ACTION

Stop IRS Action help in Mesa AZ

This phase can mean many things for different IRS problems.  If your wages are being levied, you want the IRS to stop taking your money from you wages.  If your bank account is being levied, you want that to stop or the money to be returned.  If you have a tax lien filed by the IRS you want your credit to be restored by having the lien removed.  If you have assets that under threat of being seized, you want to be able to sleep tonight knowing that the IRS has stopped seizure action.

The list could go on and on and a blog on this subject can only give you some general guidelines to follow.  If you want a specific course of action, schedule a free one hour consultation to find out exactly what needs to be done to Stop IRS Action.   This is more involved than it appears.  For instance if you own more than $25,000 to the IRS, there is much more work needed to get a monthly installment arrangement than if you owe less than $25,000.  And if you owe more than $100,000, the IRS will expect a few more hoops to jump through before giving you an agreement.

Here are some actions that will be necessary to Stop IRS action in Mesa AZ regardless of your problem:

First, make sure that all tax returns have been filed.  The IRS will require you to be in compliance before action can be stopped.  If the IRS filed a tax return for you, have a professional review it to see if filing a correct return would bring the balance owed down.  This first step is to first reduce the liability before trying to reach a settlement with the IRS.

Second, compliance also means that you are currently having the right amount taken out of your pay check if you are an employee or you are current on payment of your estimated taxes if you are self employed.

Third, make sure you have a representative who understands how to posture your finances before providing financial information to the IRS.  This may mean getting medical insurance or an automobile before negotiations begin.  Afterwards, the amount of money left over after your settlement might now allow for these type of purchases to be made once you are locked in with the IRS.

Fourth, know all of your options to settle with the IRS.  That means understanding the pros and cons of each option.  Make sure you evaluate all the options at the same time.  If you are married, whether your spouse is responsible for the tax debt or not, be a part of the decision process.  What ever affects you affects your spouse indirectly.  Especially if it pertains to money and finances.

Finally, get some professional help to stop IRS action in Mesa AZ.  The IRS personnel are not bad people.  But they are trained bill collectors and are not there to make you knowledgeable of your options that can make your settlement easier for you.

Scott Allen E. A.

Tax Debt Advisors, Inc. – Since 1977

www.stopIRSaction.com

 

BACK TAX RETURNS, IRS Problems
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Regular Post
Written by Scott Allen

WHAT CAUSED MY IRS PAYMENT PLAN TO DEFAULT?

IRS Payment Plan Default

When you default on an installment arrangement there is no explanation.  The most common reasons are:

  • You didn’t send in your payment or your payment was late.  If you call immediately upon receiving the notice, you can usually be reinstated as soon as your payments are current.  Don’t depend on the IRS vouchers as a reminder to make your payment.  Vouchers can come to you after the due date or not at all.  Have a note on your calendar to make your payment whether or not the voucher shows up.  If you send in a payment without a voucher, include your social security number, the tax year to apply the payment (2020-1040) and have your phone number on the check.
  • You filed your return late or did not pay your taxes in full when you filed your return.  One of the conditions of having a payment plan with the IRS is that you don’t get behind on filing or paying in the future.  Again, the IRS will likely reinstate the agreement if you can bring your payments current and you contact them immediately after receiving the notice of default.  To prevent this from happening in the future make sure your estimated taxes are paid timely if you are self employed or that your withholdings are sufficient if you are an employee.

If you default and you have to renegotiate your payment plan with the IRS it is unlikely you will get the same payment amount.   If your financial situation has worsened, your payment amount will be reduced.  Likewise, if your financial situation has improved, your payment amount will go up.  Rather than just go back into another installment arrangement, I advise our clients to reevaluate to see if there is another settlement option that would be better now that their situation has changed.

There are legitimate situations where I advise clients to strategically default on purpose so that a better settlement can be reached with the IRS.  This should only be done with the help of a professional representative who can guide you through the renegotiation process. Our company has over 45 years of tax preparation and IRS negotiation experience.

Scott Allen E. A.

Tax Debt Advisors, Inc.

IRS Problems, IRS Tax Payment Plan
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