Frequently Asked Questions
I owe the IRS. Am I going to jail?
I get this question a lot from new clients who have been living in fear for years on end. The answer is probably not. There is no debtor prison in the United States. Most of these cases are just regular people who had life happen to them then didn’t file one year. Oops, it turned into two years, then five years and so on. They are negligent, not criminal. Unless there is major fraud involved, you are likely not going to jail. And if you did happen to be one that was defrauding the government and was going to jail, you would know about it ahead of time. There is a scam going on now where someone will call you and tell you that the police are on their way to arrest you for your IRS problems. This is just a scam! They want you to send them money, but don’t do it!
I’m embarrassed to tell anyone about my IRS problem. I don’t know what to do first.
Don’t worry, we see people like yourself every day. You are definitely not the only one! You just perceive that you are because people don’t talk about their IRS problems with their friends. It gets pushed under the rug until they are forced to deal with it. Believe it or not, there is a lot of relief in going ahead and addressing the issues. It’s like the clouds part and the sun comes out. We’ve many clients transition from scared and unsure into empowered and conquering. It’s a beautiful sight!
An IRS agent contacted me and said I must attend a meeting to provide information. What should I do?
Remain calm. That individual is likely a Revenue Officer. He/she works for the IRS Collections Department. They are from your local IRS office and are only trying to get you into compliance. Now is a good time to work on that. Give us a call, and we’ll guide you. We work with Revenue Officers every day. Most are nice people just doing their job. However, their job is collecting money from you, so be careful what you send. We’ve seen clients accidentally send completely inaccurate information that really hurts their case. Cleaning up behind a mistake of this sort can be very difficult.
The IRS filed a lien against me while I’m in a payment arrangement. What should I do?
If the IRS thinks you owe them money, they will file a lien with your county clerk of court. It doesn’t matter if you’re in a payment arrangement or currently not collectible status. They are going to protect their interests.
What is a tax lien, and how does it affect me?
A lien is a document filed with the county clerk of court where you live or own property. It prohibits you from selling any real property without first addressing the IRS issue. There are ways to have a lien removed so title to the property can be transferred, such as in the case of a short sale.
I was in a payment arrangement that I could afford but now I’ve lost my job/income. What do I do now?
There are options available for people who can’t afford to pay right now. We can either have your payment lowered or put you in “Currently Not Collectible” status. These strategies require that financial information be submitted to prove that you qualify.
The IRS levied (garnished) my pay. Now I can’t afford to live. What can I do?
We can have the levy lifted if we either get you into compliance with filing all delinquent tax returns and getting you into an acceptable payment arrangement or currently not collectible status.
The IRS levied my bank account and took my money.
A bank levy is a one day levy which means that the IRS will take what was in the account at the time the levy was issued but you get to keep whatever comes in tomorrow, at least until another levy is placed. There are ways to get a bank levy released if you act soon enough. Generally this is used to get your attention. The IRS wants you to get into compliance.
What if I can’t afford to pay the tax?
The IRS is not supposed to take what you don’t have. They do have a program for people who are unable to pay. It’s called the “Offer In Compromise”. You must get into compliance with filing past due returns then prove that you don’t have the means to pay by providing extensive documentation of your assets, liabilities, income and expenses.
I didn’t file my tax returns so the IRS filed them for me. Now they say I owe a bunch of money. This can’t be right.
If you don’t file, the IRS prepares as “substitute for return” on which they include all income that was reported to them on forms W-2 and 1099 but no expenses, asset basis or exemptions. The best remedy for this is to file the returns yourself or have your tax preparer do it. They do not have to be amended returns, just originals.
My records were all lost in a fire/flood/move/divorce so I didn’t file my returns. Now the IRS says I owe a bundle.
There are other ways of getting information that you no longer have. We utilize bank statements and IRS standard expenses for your industry. It might cost a little more to have the records recreated and maybe a few expenses will be missed but it is never as bad as having the IRS file returns for you.
I’ve been trying to take care of this myself but am getting nowhere fast. Why?
Having representation greatly increases your chances of a positive outcome with the IRS. We know how to navigate their system, what your rights are and how to make sure they aren’t violated. The IRS employees are there to protect the government’s interests, not yours.
There is a lien on my house. Can I sell it?
Yes. You must file a request to have the lien released from that particular property for the sale. However, if there are proceeds from the sale coming to you, the IRS will take them up to the amount they say you owe; so it’s important to make sure that you agree with their balance due before you sell.
My husband/wife did this to me. It’s their debt but because we filed jointly, the IRS is coming after me. Do I have to pay?
You might qualify for “injured spouse” defense. If you do, you only have to pay the debt that is yours, from your income sources. We can help.
I haven’t filed my tax returns since 20XX and have been living without a bank account or job because I’m so scared of what they might do to me. Can you help?
Yes, absolutely! It’s much more common than you might think! People live with this dark cloud above their heads for years on end. It impacts their productivity, self-esteem, earning potential, family life and a myriad of other areas. Many times, once we file the past due returns, there is either no balance due, or the client qualifies for an Offer in Compromise and the balance is easily handled. Stop hiding and come out into the sunlight. There is always something that can be done to help you get back on track.
How do I find a representative?
Check out any potential representative thoroughly. The Better business bureau is a good place to start. Look at client reviews, ask questions. Beware of strong sales tactics. There are many scam companies in this industry. Ask for references. Talk to any potential representative and get a feel for their knowledge level. Listen to how you intuitively FEEL about the person you’re considering hiring. Find out how many years they have been handling these types of cases. Honestly, most CPAs don’t do much IRS resolution. It’s very specialized and people who do it every day know what’s what. Choose wisely. We’ve seen dozens of clients who were taken advantage of by their previous representative. In one case, a client had hired three companies before us, paid upwards of $35,000 in fees and had nothing close to a resolution in his case. We came in and got him out of $2.8 million dollars in tax and penalties. Not a common occurrence, but it does happen.
I live several hundred miles away from your office. Can you still help me?
Of course. With the technology available today, everything can be done via email, fax, phone and snail mail. We are located in Central Florida but have clients all over the country.
Do you only handle IRS problems?
No, once we get our clients into compliance, we like to help keep them compliant. We also offer tax planning, annual tax return preparation, monthly bookkeeping and payroll for business clients and business coaching. Any or all can be put on a monthly budgetable fee which includes all of the services you need plus any audit representation. Many clients find it very comforting to know that they always have someone to call and won’t be charged an arm and a leg.
What are your fees
Our fees vary by service offered because the amount of work can vary so widely, but we always try to be fair and mindful of your situation. Request a quote.