Thursday, May 31, 2012

IRS Fresh Start Adds Flexibility and Eases Eligibility to Offer in Compromise Program

IRS OFFERS FRESH START

and

MORE FLEXIBILITY

for

STRUGGLING TAXPAYERS

On 5/21/2012, the IRS announced more changes to the IRS settlement program known as an Offer in Compromise. The IRS has initiated a "fresh start" program designed to help financially struggling taxpayers in IR-2012-53 (dated 5/21/12). The most recent changes address the financial analysis which is a complicated formula used by the IRS to determine eligibility in the Offer in Compromise program as set forth in the Internal Revenue Manual (RM Parts 5.8 and 5.15).

HERE'S THE



THE IRS FRESH START CHANGES INCLUDE: 
  • Revising the Calculation of Future Income [IRM 5.8.5.23 (2/23/10)] - If a struggling taxpayer can pay their back tax debt in five (5) months or less, the IRS will consider only one (1) year of future income. The IRS will also only consider two (2) years of a struggling taxpayer's future income if that taxpayer can pay the IRS settlement amount within six (6) to twenty-four (24) months. 
  • Allowing Re-Payment of Student Loans [IRM 5.8.5.20.4(3) (10-22-10)] - The IRS has announced that they will now allow credit for student loan payments made on federally guaranteed student loans for post secondary education.
  • Allowing for Payment of Delinquent State and Local Taxes [IRM 5.8.5.20.4(7) (10-22-10)] - Based on a percentage of taxes owed to a state and the IRS, the IRS will now allow, in most cases, payment for the delinquent back tax debt. Prior to this IRS announcement, monthly payments to a state or local taxing authority were not considered by the IRS to be "necessary expenses" even if that state or local taxing agency had a tax lien that was senior to any IRS tax lien. Previously, the IRS did not consider a wage garnishment or installment agreement by or with a state or local tax agency to be a "necessary expense." 
  • Expanding the National Standard Miscellaneous Allowance [IRM 5.15.1.8 (10-2-09)] - credit card payments, bank charges and fees are now considered by the IRS to be "necessary expenses." The miscellaneous allowance are expenses that a struggling taxpayer may incur that are not included in any other allowable living expense. 
  • Modifying the Parameters for Calculating the "Reasonable Collection Potential" (RCP) [IRM 5.8.5.1 (9-23-08)] - Significant changes have been made by the IRS to the definition of equity in income producing assets for an on-going business [IRS 5.8.5.5.1 (10-22-10)], evaluating money in bank accounts [IRM 5.8.5.6 (10-22-10)], as well as evaluating dissipated assets [IRM 5.8.5.16 (10-22-10)], retired debt [IRM 5.8.5.17 (10-22-10)] and transportation expenses for older vehicles [IRM 5.8.5.20.3 (10-22-10)]

THE IRS DID NOT BECOME 

WARM and FUZZY




The IRS has a problem due to the bad economic times that we live in. The IRS has a lot of tax debt to collect from too many struggling taxpayers. The IRS has been forced to adjust their collection practices. Consequently, the has put in place Offer in Compromise eligibility requirements that make it significantly easier for a taxpayer to qualify for an IRS settlement.

The IRS will continue to try and collect as much back tax debt as they possibly can but when a struggling taxpayer has an experienced IRS Tax Attorney to prepare and guide them through the Offer in Compromise process their chances for success will be high.

OFFER in COMPROMISE 

APPROVALS ARE UP

The IRS has made significant progress under it's previous "Streamlined Offer in Compromise" program. The IRS accepted 19,562 settlements in Fiscal Year 2011 and that represents a 41% increase
over Fiscal Year 2010 and the IRS overall rejection rate was 20% which was down from the 25% rejection rate in Fiscal Year 2009. These figures are according to the National Taxpayer Advocate's Office in their 2011 annual report to Congress. 

THE IRS WILL STILL REJECT YOUR

OFFER in COMPROMISE

as

NON-PROCESSABLE

Although the number of Offer in Compromise approvals have increased and in fact should continue to do so through shear volume of settlement offers, the number of settlement offers that have been "kicked out" and rejected as "non-processable" remains a mystery. 

The first (1st) stage of a successful Offer in Compromise is for your settlement offer to get through the Offer in Compromise processing centers located in Tennessee and New York. It is during this period of time that the IRS looks for any clerical error or excuse to reject an Offer in Compromise. This rejection is not counted in the data and the IRS does not have to provide a taxpayer with a reason other than to label the rejected Offer in compromise as "non-processable."

The current IRS changes to the Offer in Compromise Fresh Start program should allow more settlement offers to be accepted provided your settlement offer is prepared accurately and without error. 

AFFORDABLE IRS FRESH START

OFFER IN COMPROMISE

IRS FRESH START OFFER in COMPROMISE HELP
If you owe the IRS between $10K and $100K; pay only $1900 for full IRS Fresh Start program work which includes: Release of IRS Levy / IRS Wage Garnishment removal and IRS Offer in Compromise.

MONTHLY INSTALLMENTS AVAILABLE

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EMAIL ME:

dave@flatfeetaxservice.com



I am Dave Rosa, the V.P. of Client Relations at Flat Fee Tax Service, Inc. During our consultation we will be able to provide you with an action plan to resolve your IRS problem. With IRS regulations allowing a struggling taxpayer to settle their back tax debt for less, you would be foolish not to find out if you are qualified for the Fresh Start IRS program. It costs you nothing to call me and you are under no obligation whatsoever. Now it is up to you.

WHY FLAT FEE TAX SERVICE, INC. FOR YOUR FRESH START IRS SETTLEMENT:
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1 comment:

  1. The IRS has made "settling for less" easier through the IRS Fresh Start program. Take advantage by calling Flat Fee Tax Service, Inc. Our Website is: http://www.flatfeetaxservice.com and our informative blog is: http://www.affordableirshelp.com Follow our tweets on twitter: http://www.twitter.com/flatfeetaxsvc

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