Monday, May 30, 2011

IRS Problems -- IRS Eases Up on Tax Debtors -- Don't Wait -- Settle with the IRS Now

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IRS Eases Ability to Settle

The Internal Revenue Service (IRS) announced that it's going easier on people who haven't paid their federal taxes.

IRS Commissioner Doug Shulman said the service is making five changes to its lien system and collection tools that will help people with tax debts "get a fresh start." Here are the changes:

Tax Lien Threshold Raised

For starters, the IRS generally won't file a tax lien against people who owe less than $10,000 in back taxes, twice the current threshold of $5,000. People who have a history of tax avoidance might not qualify. A tax lien gives the IRS a legal claim to a taxpayer's current and future property for the amount of an unpaid tax debt, but it is not filed until the IRS has made repeated attempts to collect from a taxpayer.

"Raising the lien threshold keeps pace with inflation and makes sense for the tax system," Shulman said. "These changes mean tens of thousands of people won't be burdened by a tax lien, and this step will take place without significantly increasing the financial risk to the government."

Tax Liens Withdrawn

The IRS will also withdraw a lien once full payment of taxes is made if the taxpayer requests it. That means it will disappear from the taxpayer's credit report, according to Rod Griffin, director of education with the credit reporting firm Experian.

Today, after a tax debt is paid, the IRS releases a tax lien. "At that point we no longer have a claim to any asset that the tax lien is attached to," Shulman said.

Shulman said that "from our standpoint," a release and a withdrawal are the same thing, but some taxpayers have requested the change because they believe a withdrawal makes it easier to clean up their credit record and get a job.

An unpaid tax lien remains on a credit report for 10 years. If the tax is paid, and the tax lien is released, the evidence will remain on the credit report for seven years from the paid date. However, if the lien is withdrawn, "we will remove it from the credit report."

Of all the things that are bad on a credit report, one of the worst is a Federal tax lien. The ability to have the atx lien withdrawn is a fantastic incentive for consumers to find a way to pay their tax bills.

Direct Debit Agreements / Installment Agreements

The IRS will also withdraw liens if a taxpayer owes $25,000 or less and either enters into a direct debit installment agreement / payment plan, converts a regular installment agreement into a direct debit installment agreement or is already on a direct debit agreement and asks for a lien withdrawal.

The IRS will withdraw the lien after a "probationary period" demonstrating that direct debit payments will be honored.

Small Business Installment Agreements

The IRS will make streamlined installment agreements available to small businesses with $25,000 or less in unpaid taxes, up from a current limit of $10,000. Small business will still have 24 months to pay.

The streamlined agreements will be available for small businesses that file either as an individual or as a business. A small business that owes more than $25,000 could qualify if it paid down the balance to $25,000 or less.

Expanded Offer in Compromise (OIC)

The IRS is making a new streamlined Offer in Compromise (OIC) program available to people with annual incomes up to $100,000. The current income limit is $50,000. 

Under an Offer in Compromise (OIC) agreement, the IRS settles a person's tax debt for less than the amount due. It is generally accepted only when the IRS believes it cannot collect the full amount due based on the taxpayer's income and assets.

Asked if these new measures will increase or decrease tax collections, Shulman said they will "probably be neutral for revenue collection," although the expanded offer in compromise programs could bring some money in the door.




The IRS remains the world's most powerful collection agency and their job is to collect money. Make no mistake about that. Should make an error in the formula to settle through the Offer in Compromise program, your Offer will be rejected immediately as "un-processable." If you do not cross a "t" or dot an "i", your Offer in Compromise will be rejected as "un-processable." 


To An


You need to be absolutely sure that your tax debt has been reduced to it's lowest number. Are you Qualified for IRS Settlement through he Offer in Compromise program? Are you Currently not Collectible? Could your tax returns be amended so that you are being assessed the correct tax? 




With the IRS


I am Dave Rosa, the V.P. of Client Relations at  Flat fee tax Service, Inc. I will be conducting your consultation to see what needs to be accomplished to resolve your IRS problems as quickly and as efficiently as possible. We, at Flat Fee tax Service, post our fees clearly and boldly on our Website for everyone to view (including competitors). We believe in being upfront and straightforward. 

We may not be able to help you. If this is the case, we will offer you our best advice and wish you well. We do not take on everyone who contacts us.

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1. You can pay your tax liability off in full.
2. If you cannot pay your tax debt off in full, you can enter into an IRS Installment Agreement / payment plan. Should you attempt to do this yourself, you may agree to a monthly payment that is much higher than what you should be paying.
3. Stop the Levy and begin the process of an IRS settlement through the IRS Offer in Compromise. Not everyone is eligible and qualified for an Offer in Compromise but you will not know if you can settle with the IRS for less unless you have a complete consultation with an experienced, diligent tax attorrney.
4. Stop the Levy and be declared Currently not Collectible (CNC) which is sometines called Currently Uncollectible. When your allowable expenses (according to the IRS formula) exceeds your current income and ability to pay your tax liability, you may be declared by the IRS to be Currently not Collectible and for a period of 18 to 24 months, you will not pay the IRS anything. During the Currently not Collectible period, the Statute of Limitations continues to run out and the IRS will leave you alone. At the end of the 18 to 24 month period, you will need to show the IRS your present financials (433-F), bank statements, pay stubs, etc. and if nothing has changed, you will continue to be classified as Currently not Collectible (CNC). 
5. Should your financial position improve, then other strategies come into play such as Installment Agreement or filing an IRS settlement through the IRS Offer in Compromise program.
6. You will be better off if you have an experienced tax attorney handle these matters for you. You do not know the IRS Code or IRS Manual. You do not have any in depth experience with the collections division of the IRS and you, most likely, will make crucial errors and harm yourself.

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1 comment:

  1. The IRS has eased up on it's tax Lien and Settlement policies. Find out how. If you owe the IRS a tax liability, you need to look at your options.


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