Posted by taxreliefattorneys on July 15, 2010
If you are a parent, and you use childcare while you are at work, the IRS offers a tax credit you can take advantage of. But, before going over the details, we should elucidate the difference between a tax credit and a tax deduction. A tax deduction shaves money off of your taxable income. The result is as if you did not earn that income in the first place. The tax benefit you receive depends on your bracket. So, if you’re in the 20% bracket, a $10,000 deduction would effectively lower your tax liability by $2000. Read the rest of this entry »
Posted in Federal Income Tax, Tax Credits, Tax Relief Law, Uncategorized | Leave a Comment »
Posted by taxreliefattorneys on July 12, 2010
Equitable Relief
If the IRS determines that you do not qualify for either standard Innocent Spouse Relief Relief by Separation of Liability, they will then determine if you qualify for Equitable Relief. Under the first two types of innocent spouse relief, you only qualify if you reported less taxable income that you should have. With equitable Relief, you can get relief even if the return was filed correctly. Read the rest of this entry »
Posted in Federal Income Tax, Innocent Spouse, Personal Finance | Leave a Comment »
Posted by taxreliefattorneys on July 8, 2010
Relief by Separation of Liability
In the last entry we showed that tax relief can be available for a married or formally married person if their spouse created/caused errors on a joint return and the errors were unknown to the other spouse. In this entry we will review the second way it is possible to attain relief from taxes, penalties and interest caused directly by one’s spouse. Read the rest of this entry »
Posted in Federal Income Tax, Innocent Spouse, Separation of Liability, Tax Relief Law | Tagged: Equitable innocent spouse relief | Leave a Comment »
Posted by taxreliefattorneys on July 6, 2010
To qualify for the original type of Innocent Spouse Relief (before the addition two types were created to accommodate situations not covered in the original), you and your spouse must have filed a joint return reporting an understatement of tax, the error being caused by your spouse (or former spouse). An understatement of tax is when you report that you owe less tax than you actually do. This usually happens by under reporting quantity of income, overstating deductions, misstatements of basis of property over claims of exemptions and mathematical errors. One example would be if your spouse earned $65,000 as a restaurant waiter, but only reported that they earned $35,000. Read the rest of this entry »
Posted in Federal Income Tax, Innocent Spouse, Personal Finance | 1 Comment »
Posted by taxreliefattorneys on July 3, 2010
Well, we knew it was coming, and here it is. The IRS 10 percent excise tax on tanning salons has arrived. We first informed readers about this new tax in an original story about small businesses tax breaks. We mentioned that small businesses currently enjoy a 35% tax deduction under the new health reform laws. Unfortunately for tanning salons and their customers, the 10% tax will take a small bite out of that 35-percent. Read the rest of this entry »
Posted in Business Tax, Federal Income Tax, Health Care Reform, Small Business, Tax Relief Law | Leave a Comment »
Posted by taxreliefattorneys on July 1, 2010
Innocent Spouse tax relief is available from the IRS for those situations where one spouse is responsible for creating a tax liability, where that liability would otherwise be unfairly imposed on the other spouse. If your spouse created a tax liability with the IRS, and some states as well, and you had nothing to do with it, you can save yourself from debt, penalties and interest by securing Innocent Spouse relief. Read the rest of this entry »
Posted in Innocent Spouse, Personal Finance, Tax Relief Law | Leave a Comment »
Posted by taxreliefattorneys on June 30, 2010
No one enters into the blissful bonds of matrimony thinking they will end up saddling their husband or wife’s back tax debt. However, this is one of the common issues taxpayers find themselves experiencing. Read the rest of this entry »
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Posted by taxreliefattorneys on June 25, 2010
In the last entry, we went over the issue of an IRS wage garnishment. Another way the IRS can secure taxes that they believe you owe them is through a bank levy. The IRS will usually resort to a levy when other attempts for collection have failed. Of course, the IRS can put a lien on any type of property you may own, including houses, cars, boats, etc. But a bank account is the most common type of levy they impose. They can literally seize all of the money in your account and wipe out your bank account entirely. Read the rest of this entry »
Posted in Bank Levy, Federal Income Tax, Personal Finance | Leave a Comment »
Posted by taxreliefattorneys on June 24, 2010
Anyone who’s experienced a wage garnishment knows just how disheartening and debilitating it can be. If the IRS decides to garnish your wages, your employer is ordered to send a percentage of your net pay to the federal government until your tax liability is met. The specific amount the IRS can withhold from each check varies. Factors such as marital status and number of dependents (if any) will all affect the amount of each payment. In worst-case-scenarios, the IRS can withhold up to 90 % of each paycheck. Read the rest of this entry »
Posted in Federal Income Tax, Personal Finance, Wage Garnishment | Leave a Comment »
Posted by taxreliefattorneys on June 21, 2010
If you are in the process of negotiating with the IRS to get penalty abatement, it helps to know the most common occurrences of IRS tax relief when penalty abatement is being requested. There are, of course, an endless number of situations that the IRS can deem a “Reasonable Cause” for penalty abatement. The IRS guidelines suggest that abatement should be “generally granted when the taxpayer exercises ordinary business care and prudence…” in resolving their tax problems. Read the rest of this entry »
Posted in Federal Income Tax, Penalty Abatement, Personal Finance, Tax Relief Law | Leave a Comment »
Posted by taxreliefattorneys on June 15, 2010
If you find yourself owing the IRS back taxes to the point where you have accumulated a sizable debt, you should be aware that a large portion of what you owe might very well be penalties and interest. The IRS generates literally billions of dollars a year in penalties. They do, however, understand that if too many taxpayers find themselves in financial distress, getting them to pay taxes on a regular basis could be increasingly difficult. Read the rest of this entry »
Posted in Federal Income Tax, Penalty Abatement, Personal Finance | Leave a Comment »
Posted by taxreliefattorneys on June 11, 2010
OIC Payment Options
If you have been approved for an IRS Offer in Compromise to facilitate repayment your IRS tax liability, the next step is to understand what your payment options are.
To begin with, a taxpayer will generally have to pay an application fee of $150 along with their initial payment-both accompanied by Form 656. Then tax liability itself can be resolved in one of the following three payment methods: Read the rest of this entry »
Posted in Federal Income Tax, Personal Finance, Tax Relief Law | Leave a Comment »
Posted by taxreliefattorneys on June 1, 2010
There are three different classes of Offers in Compromise. We will go over all three in brief here. You can read more detailed information on Offers in Compromise on the IRS website.
Doubt as to Collectibility – This is a case where there is doubt as to taxpayer’s ability to ever pay the full amount of tax liability owed (within the remainder of the statutory period for collection).
From the IRS website: “Example: A taxpayer owes $20,000 for unpaid tax liabilities and agrees that the tax she owes is correct. The taxpayer’s monthly income does not meet her necessary living expenses. She does not own any real property and does not have the ability to fully pay the liability now or through monthly installment payments.” Read the rest of this entry »
Posted in Federal Income Tax, Personal Finance, Tax Relief Law | 1 Comment »
Posted by taxreliefattorneys on May 28, 2010
On average, taxpayers only have to think about income tax, and all of the confusing forms and IRS terminology once a year. But, if you find yourself with an unexpected tax debt and facing some possibly scary options, it’s a good idea to know what the IRS or state tax agency is talking about in all of those letters they’re sending you. The first step is to secure the services of a reputable and experience tax relief firm. Pending that, we will focus on a few of the areas of difficulty you may be having with the IRS or state, and shed some light on them. Read the rest of this entry »
Posted in Uncategorized | 1 Comment »
Posted by taxreliefattorneys on May 25, 2010
We covered the IRS extension for the 14 counties in Tennessee in a previous entry. But there are a number of other states that have endured serious weather-related issues and have also been declared national disasters by the federal government.
If your business has been a victim of spring flooding, heavy storms, tornadoes or other disasters, you may be able to delay filing your taxes or get relief from penalties if you are in a county declared as a disaster area. Read the rest of this entry »
Posted in Federal Income Tax, Personal Finance, Small Business | Leave a Comment »
Posted by taxreliefattorneys on May 24, 2010
The IRS has been reaching out to millions of small businesses and tax-exempt organizations to inform them of tax relief resulting from benefits of the recently enacted Small Business Health Care Tax Credit. The communication comes in the form of a postcard which essentially states that if your business (or tax-exempt organization) pays employee health insurance premiums in 2010, you may be eligible to claim a new credit on your 2010 tax return. Read the rest of this entry »
Posted in Business Tax, Federal Income Tax, Health Care Reform, Small Business | Leave a Comment »
Posted by taxreliefattorneys on May 21, 2010
Continued from: Taxpayers Informing for the IRS On The Rise
As a result of the current economic downturn, the IRS has negotiated fewer agreements to settle tax debts for less than the amount owed than anytime in the past decade. This is according to the National Taxpayer Advocate, a consumer watchdog organization tasked to protect taxpayer rights when dealing with the IRS. The best approach, if you find yourself owing money to the IRS, is to seek tax relief from an experienced tax attorney or other professional representation. Compliance with IRS and state taxes is always the right thing to do, and always has the most positive effect on your piece of mind and overall lifestyle.
Most Americans agree with this assertion, taxpayer compliance with the IRS is steady at about 85%. There are, however, some state and local statutes that can provide amnesty for those that seek to pay what they owe late. In Pennsylvania, for example, taxpayers who pay by June 18 can have their penalties waved and their interest charges reduced by half.
Disclaimer: The information contained in this article is in no way intended for use as legal tax advice. No assumption should be made that a tax attorney, enrolled agent or former IRS employee was involved in the creation of any content herein. Advice on personal or business tax matters can be obtained by contacting Advanced Tax Help at (800) 970-8704, or by logging on to www.advancedtaxhelp.com
Posted in Federal Income Tax, Personal Finance | Leave a Comment »
Posted by taxreliefattorneys on May 20, 2010
Citizens informing on other taxpayers to the IRS is nothing new. Four years ago Congress passed the Tax Relief and Health Care Act of 2006 to enable taxpayers to inform on one another and receive possible awards in the process. According to Bloomberg, The IRS receives about 30 to 50 tips a month from disgruntled business associates, bitter spouses, etc. on potential tax evaders. The reward for informing on a possible tax evader can be 15% to 30% of all money collected in excess of $2 million. Before the 2006 measure was passed, it was up to the discretion of the IRS whether or not to offer a reward to informants. Also, the amount of reward was limited to $10 million. Read the rest of this entry »
Posted in Federal Income Tax, Personal Finance | Leave a Comment »
Posted by taxreliefattorneys on May 19, 2010
Continued from: Tax relief Offered for Disaster Victims
As far as employment and excise tax deposits, the postponement does not apply to these. The IRS will abate penalties for failure to make timely employment and excise taxes, though, so long as they are due on or after April 30 and on or before May 17, 2010.
In a news release, the IRS stated that individuals who live in federal disaster areas will automatically identified by their computer system, and apply any available postponements to file or pay taxes. If you are affected by a disaster and live outside designated areas, you must call the IRS disaster hotline at 866-562-5227 to request relief. Read the rest of this entry »
Posted in Federal Income Tax, Personal Finance | Leave a Comment »
Posted by taxreliefattorneys on May 17, 2010
Victims of natural disasters should be on the lookout for IRS tax relief coming their way. The Internal Revenue Service is postponing tax return deadlines for business owners in 42 Tennessee counties. The counties in question have been declared disaster areas by the federal government. (A complete list of affected counties is provided at the end of this article.) Read the rest of this entry »
Posted in Federal Income Tax, Personal Finance | Leave a Comment »
