Who Can Represent You When You Have Tax Debt?
If you watch television, listen to the radio or browse the internet, chances are you have heard or seen an advertisement claiming to settle your tax debt for next to nothing. Tax relief companies use mainstream media to reach taxpayers when they are in over their head with tax debt and desperate for a solution. They make claims such as reducing your tax liability for pennies-on-the-dollar and settling with the IRS so are you only responsible for a fraction of what you owe. These fraudulent companies often require a significant upfront fee to begin the process and never end up giving you the results you are seeking.
If you owe back taxes, do not be misled by one of these scams. Depending on your situation, you have options. For most tax related debt, you have the option to represent yourself or hire a legitimate tax relief professional. In order to understand your options, the following are the most common tax debt issues and who can help you in these situations.
Most people are familiar with the general idea of audits; however, until you receive notification that you are being audited, you never fully explore the process. Individuals are selected for audits based on a number of reasons. If you’re a high income earner or you own your own business, you’re a likely target. However, you can also be selected based on other factors such as random selection, mathematical errors on your tax forms, inconsistent documentation submitted to the IRS, and unusual or excessive deductions, among others.
If you receive notification that you are being audited, you have two options: represent yourself or hire a professional. If you choose to represent yourself, it is extremely important that you understand the process and what the IRS needs from you. You’ll have to provide a significant amount of documentation and if the process is not handled in a timely manner, you may be subject to additional penalties and fees.
Your other option is to hire a professional. During an audit, a tax relief professional will review the audit process with you and ensure your rights are being protected during the entire audit. They will represent you during the audit, providing you with options the whole time. If you need to appeal your audit, they will prepare and submit the appeal on your behalf. Due to the complexity of audits, hiring a professional is a wise decision.
When you owe back taxes, the IRS has a number of ways to collect the taxes including wage garnishments, bank levies, tax liens and asset seizures. Depending on the method the IRS uses, you can choose to handle the matter yourself or hire a professional.
Typically, you receive notification that the IRS intends to garnish your wages or issue a levy. In this scenario, you can pay the debt yourself before this happens or you can hire a tax professional to ensure it doesn’t happen now or in the future.
However, if the IRS has already issued the levy or garnished your wages, you will need to request a release. While this is something you can do on your own, a tax debt professional will be able to help you through this process more efficiently. When you a hire a professional, they will contact the IRS immediately to request a release of the levy and wage garnishment. If the IRS refuses to release the lien, a tax representative will submit a formal appeal and represent you during the appeals process.
The IRS can also issue a tax lien. If a lien is placed on your property, it gives the government the right to all of your property. If this happens, you may be eligible for a payment agreement or tax settlement. This is something you can arrange yourself; however, it is a detailed process. When you arrange any type of settlement or payment plan with the IRS, you must complete a variety of paperwork. Tax relief professionals understand the paperwork, terminology and requirements necessary to receive relief. It could save you time and money to let a professional represent you if you’ve received a lien.
While levies, garnishments and liens are more common, seizures are neither common nor practical. If the IRS is considering seizing your assets, it is a serious matter and your personal and real property as well as your intangible property are in jeopardy. Seizures are very serious and while you can represent yourself, you would benefit from letting tax debt professional represent you. A debt professional will communicate with the IRS and provide them with a detailed financial analysis outlining how you will repay the debt. If a seizure has already occurred, the tax resolution specialist will submit a formal appeal and represent you during the appeals process.
IRS Fresh Start Program, Installments Agreements and Offers-in-Compromise
The IRS offers a variety of programs to individuals seeking debt relief. The Fresh Start Program is an initiative that makes it easier for you to pay back taxes, avoid liens and get relief. Installment agreements allow you to pay down existing debt in smaller amounts over time and offers in compromise are way for you to settle debt for less than the amount owed.
Each program has a unique set of compliance and collectability requirements that must be met in order to qualify. If you have tax debt, you’re eligible to represent yourself and apply for these programs. However, when you work with a debt relief professional, it can streamline this process. Tax professionals understand the application processes and will assist you in qualifying, preparing documentation and submitting your paperwork.
When you owe taxes, it can seem impossible find relief. It’s extremely important not to fall for one of the many tax scams that are out there. Instead, take time to understand your situation and determine if it is best to represent yourself or hire a professional. If you elect to hire a professional, be sure to do research and select a credible, honest and professional debt relief service.
At Landmark, we’re comprised of former IRS Collection Officers and IRS Auditors so we know how the IRS works and how to best handle your unique situation. Contact us today at (949) 260-4770 for a free and confidential consultation.
If you would like us to review your tax case for FREE, contact Landmark Tax Group now for a free consultation.