Worst thing to do about your tax issue is!

Nothing.  By ignoring your tax issue you can miss several chances to get this resolved.  One example is when the final IRS letter is received before the IRS takes collection action (bank and wage levies) you have 30 days to appeal the proposed action.  When you file a collection appeal it can take several months for the appeal hearing and this can give you time to get your house in order. You may need to file some delinquent tax returns,  make some changes to your personal finances to improve your chances at a settlement or favorable payment terms, or request abatement of penalties for reasonable cause.  If you just do nothing you risk collection action by the Internal Revenue Service.  When this happens you have 21 days with a bank levy before the money is gone and a wage levy continues unless it is released.  So you may have two weeks until the next payday to get something worked out. We can find out where you are in the collection process and what action needs to be taken to tackle your tax issues if you will not ignore them.  

Robby

Should you represent yourself in you tax case?

No! There may be times when the issue is so minor that you can handle it but the potential for  problems you can create for yourself far outweighs the benefits of taking care of it yourself.  Your unlikely to know the law and the ramifications of some of the answers you provide the taxing authorities.  It is difficult for taxpayers to know what the IRS notices mean and what type of action is forthcoming from them.  For instance, I see the time to appeal a collection action (proposed wage or bank levy) expired because the taxpayer didn't understand what the notice meant.  I also see taxpayers enter into installment agreements they couldn't possibly pay based upon their income. Not to mention you wanting to be helpful and saying something that could really be harmful to you to an examiner. I see this after I enter cases the taxpayer has met with the agent and some explaining is required to get back on track. With a power of attorney I meet with the agents in nearly all cases and you don't.  After 28 years of representing taxpayers I'd confident this gets the best results.

Taxpayers have the right to pay the correct amount of tax.

Taxpayer bill of rights item  3 says taxpayers have the right to pay only the amount of tax legally due, including interest and penalties, and to have the IRS apply all tax payments properly. The IRS does a decent enough job with this in most instances. We file nearly all federal income tax returns electronically so the returns are processed correctly. The problem often arise when the IRS matching program can't find everything on your return. This generates a notice to you with a proposed assessment. This notice is a CP 2000. You may owe the proposed amount or you may not. There are many instances where the amount due isn't valid and an explanation can resolve this. Here are a couple of examples. I represented taxpayers who didn't report securities sales. The IRS received only the amount of the sale not the amount paid for the securities. The cost of the securities was provided to IRS and this issue was resolved generating a refund for the taxpayers. Taxpayer received CP 2000 because taxpayer made IRA contribution but the receipt of the IRA contribution wasn't reported to IRS by the financial institution so IRS had no record of this.  This can be resolved by providing all documents to IRS demonstrating that an IRA contribution was made. I've had people tell me they didn't understand the notice but they paid the proposed assessment to make the IRS go away.  BEFORE YOU PAY ANY IRS PROPOSED ASSESSMENT BE SURE YOU UNDERSTAND IT AND ACTUALLY OWE IT!  While it may be accurate it may not be. We review IRS notices often to determine if the proposed assessment is accurate or an explanation should be provided.

Robby  

Taxpayer Bill of Rights Right to Quality Service

Item two in the recent Taxpayer Bill of Rights issued by IRS is The Right to Quality Service. The IRS says taxpayers have the right to receive prompt, courteous, and professional assistance in their dealings with the IRS, to be spoken to in a way they can clearly understand, and to receive clear and easily understandable communications from the IRS, and to speak to a supervisor about inadequate service. This is going to be a challenge for IRS.  Wait times on IRS phone calls are over an hour in many cases. This is on a line dedicated to tax practitioners who represent taxpayers before the IRS. I called as I started writing this post and the recording said my wait time was greater than one hour so who knows  how long that will be. When I ultimately get through (I don't ever give up) there is a good chance the person who answers the phone will be courteous and professional. I will generally get the information I need.  Taxpayers who contact the IRS directly tell me they experience long wait times as well.  IRS notices are often long and confusing so there is work to be done in that area. We can explain to you what your IRS notice means if you need assistance. You can generally speak to a supervisor in a 24 hour period if the agent isn't helpful or won't provide the necessary information. However, I have had instances where the agent refused. I never give up so I will get that conference with a supervisor even if the agent refuses. If there is not a pressing need to talk to the IRS immediately  I can generally get a power of attorney on the IRS system in about 5 days. I can avoid the telephone delay and get what I need on line to proceed with a course of action. This is an excellent alternative to the telephone delay.  Whatever it takes is what I'm going to do to get the necessary information so we can move forward on a course of action to address your tax problems. I Never Give Up!

Robby

IRS issues Taxpayer Bill of Rights The 10 things you should know.

These rights are a list of 10 things that were previously in the tax code but difficult to find. They are now organized and listed for easy reference. Number 1 on the list is The Right to be Informed. I find often the taxpayers I represent have no idea what they owe and on many occasions why they have a tax liability. You are entitled to know what to do to comply with the tax laws, clear explanations of the laws and IRS procedures in all tax forms, instructions, publications, notices, and correspondence. At our initial meeting the first thing I do is get authorization to speak to IRS on your behalf, talk to the IRS and order the necessary documents to determine where you stand with IRS.  It is often a relief for taxpayers to just know where they stand and a course to resolve the issues. The IRS says you have the right to be informed of IRS decisions about your tax account and to receive clear explanation of the outcomes. This might be difficult as IRS notices are often long and hard to understand.  We can help you understand your notices, find out where you stand with IRS and get a path to resolve the issues often at our initial meeting or at least in a couple of days as all the documents are received. Many times people leave my office saying I feel better just knowing where I stand and what has to be done.

Robby

Do you know where you stand with IRS?

It would not be surprising if the answer was NO. IRS notices are long and difficult to understand. If you have different periods involved you may get one type of notice on one year and a different notice on another year. You may just receive a notice asking for your contact information. If you have moved IRS may not have your current address and you may have IRS notices that you aren't receiving. If you don't know where you stand we don't know either so the first step is to get your authorization (power of attorney) so we can talk to IRS for you and gather the necessary documents. With this power of attorney we become your authorized representative with IRS and we will contact the IRS on your behalf. We will gather the necessary transcripts and determine where you are and what course of action you need to take. It often provides a sense of relief when you know what the situation is and what needs to be done to get back in compliance. I find people assume the worst which may not be the case. It is best to know where you stand instead of wondering.


Robby

Choose your tax preparer carefully!

There are many fine tax preparers in the Texarkana area who are competent, ethical, and want to do the right thing. Unfortunately, there are some who aren't and that can lead to big problems for taxpayers. I have spent most of the day with an IRS agent representing one of these taxpayers. The reason the IRS is auditing the taxpayer is due to the omitted items and generally poor job the tax preparer did on this return. It resulted in the taxpayer being audited.  

In the past year, I have represented numerous taxpayers with a similar plight. They trusted someone to do their return and the results were so poor the Internal Revenue Service decided to inquire about the return. Just one tax preparer who doesn't do the right thing can impact a large group of taxpayers. Often the records are scarce and the tax preparer will not respond. This makes working out a remedy with IRS even more difficult. When you choose your tax preparer think about credentials and experience. Do they have a year round office and return their phone calls?  Remember, if you get promised something that doesn't seem right it probably isn't. This could lead to bigger problems later so carefully choose your tax preparer!



RobbyPhone: 903-792-0281
www.selphandfridaycpa.com
Email: rselphcpa@cableone.net

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Is Selph and Friday CPAs Taking On New Customers?

I write this post because every year, about this time, I get several phone calls from potential customers who ask, "are you taking on new customers?".  My standard answer is every chance I get. This normally draws a laugh and we go from there. We have served the Texarkana, Arkansas and Texas area along with the surrounding counties since November 1, 1986. I believe people assume we have been here for 27 years and have all the customers we want.  We enjoy our regular customers and look forward to solving issues for new ones as well. Are we taking on new customers? Yes, every chance we get.

Robby
Phone: 903-792-0281
www.selphandfridaycpa.com
Email: rselphcpa@cableone.net

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Can You Settle An IRS Debt for $1 (One Dollar)?

Yes, if you have no ability to pay and no equity in assets after completing the IRS financial statement 433A or B. It's called an offer in compromise and is filed on IRS form 656. The form says the offer must be more than zero ($0) and payable within 90 days of the notification of acceptance. I submitted several offers for taxpayers in the Texarkana area for $1 and those that have been accepted have been negotiated to a higher amount until recently. I realized my goal and had an offer accepted for $1.00 so it can happen. You do have to meet all the requirements of acceptance and they do keep your tax refunds for the current year. The IRS fresh start initiative announced by IRS in April 2013 did relax some of the requirements for an offer in compromise and make this a more attractive option. As always we will meet with you, gather the necessary documents, and determine the appropriate course of action for your federal or state tax debts. If you qualify an offer in compromise can be an excellent way to resolve a tax debt for less than you owe. Maybe even $1.00 will take care of it. 


Selph & Friday CPA
Phone: 903-792-0281
www.selphandfridaycpa.com
Email: rselphcpa@cableone.net

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