The Mission Statement of the Tax Resolution Blog?

We created the Tax Problem Resolution Blog to aid the average person to become more discerning buyers of tax resolution and tax representation services. Please read the index of articles below to learn more about the tax resolution industry and to assist you in solving your specific tax problem.

Jay Freeborne, Enrolled Agent at Washington Tax Services, open for business since 1989

Wednesday, November 3, 2010

Most Common Cases in Tax Representation

What follows are the most common tax representation cases that I have been handling this year:


1. Non Filer -- Substitute for Returns - Active Collection Process -

The most common individual we see is someone who hasn't filed for nearly a decade.  The inevitable happens:  the IRS files returns for this taxpayer (Substitute for Returns)  and assesses balances.  An IRS Revenue Officer or the collection branch comes out of the woodwork to pursue this taxpayer for the balance.

The tricky issues that need to be solved on a case like this:  what returns need to be filed?  All of them? Some of them? In some cases, when the client is a financial hardship case, we might just let the IRS returns stand and not replace them with updated returns.

2. Open business - Unpaid 941 taxes

Businesses fall behind on 941 taxes.  Sometimes the remedy is an installment agreement with a penalty abatement on the back end.  In other situations, particularly with a LLC or a C Corp or S Corp, we might work with the taxpayer to close the entity - thereby putting the onus on the IRS to pursue the owner individually for the trust fund portion of the taxes (which they often don't do). 



3. Penalty and Interest Abatement Help - Collection Process Handled Already.

As my post below shows, I am becoming very skilled in the art of penalty abatement.  I can tell you they're NOT easy to do. And unlike Offer in Compromises, you only really have ONE SHOT AT SUCCESS.  If you have a penalty abatement rejected by the original office that handles it, and then have it rejected by the appeals office, you are out of luck -- UNLESS you want to pay an attorney to sue the IRS in U.S. District Court! Not likely.  So, considering you have one chance at success, hiring an experienced tax professional is in your best interest.   Penalty Abatement - Winning Appeals

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