Monday, August 7, 2017

Owe The IRS Income Taxes? The IRS May Grant You Currently Not Collectible Status

CURRENTLY NOT COLLECTIBLE

Sometimes financially struggling taxpayers and those taxpayers receiving Social Security, Social Security Disability (SSDI) and Veterans Pensions  find themselves owing past due federal income taxes they cannot afford to pay. Although notices from the IRS can be especially frightening, there are solutions.

YOU HAVE OPTIONS



If your income tax owed is less than $50,000, the IRS will accept monthly payments over five years. For example, if $6,000 is owed to the IRS, monthly payments of around $100 can be made. 

IF YOU CANNOT PAY

YOUR INCOME TAX DEBT?

There are laws in place that provide that taxpayers who are unable to pay their income tax debt can be placed on Currently Not Collectible (CNC) status with the IRS and not have to pay their past-due income taxes. 

THE IRS CAN IMPOSE A 15% LEVY AND SEIZE YOUR SOCIAL SECURITY, SOCIAL SECURITY DISABILITY (SSDI) AND/OR VETERANS PENSION

Seniors with especially low incomes can obtain Current not Collectible (CNC) status. You should have an experienced IRS Tax Attorney represent you.

The IRS can provide you with Currently not Collectible statuse and just as easily disallow it.

However, you may be asked to complete a financial form that shows you do not have any surplus income after paying necessary monthly living expenses.

Through the Federal Levy Payment Program (FPLP), the IRS can garnish 15 percent of a senior’s Social Security for past-due income taxes.

Applying for Currently not Collectible Status

Here are some guidelines and requirements for applying for CNC status:
1. The financial information supplied must prove to the IRS that the individual does not have any surplus income after paying their necessary monthly living expenses and that they have no significant additional assets.
2. Individuals may need to submit their bank statements along with this IRS financial statement and any other relevant financial documentation for review.

IF YOU OWE MORE THAN $10,000 AND ARE ELIGIBLE AND QUALIFIED TO BE CURRENTLY NOT COLLECTIBLE, WHY AREN'T YOU DOING AN OFFER IN COMPROMISE SETTLEMENT?

ISN'T BETTER TO SETTLE YOUR DEBT AND BE COMPLETELY FINISHED WITH THE IRS?

Once taxpayers are placed in Currently not Collectible ( CNC) status, they will maintain this status for at least a year. In the case of retirees, the status will likely be indefinite since retirement income and Social Security are constant and most retirees will not be working in the future. 

THE IRS CAN RESCIND CURRENTLY NOT COLLECTIBLE STATUS AT ANY TIME

WHY GET INTO A CRAP SHOOT?

DO AN OFFER IN COMPROMISE AND GET RID OF YOUR IRS TAX DEBT FOR GOOD

If an individual’s account keeps their Currently not Collectible (CNC) status until after the statute of limitations on the debt runs out, usually around ten years, the IRS will be permanently prevented from collecting the debt.

AN OFFER IN COMPROMISE IS PERMANENT

CURRENTLY NOT COLLECTIBLE IS NOT

What About State Income Taxes?
Not all states have procedures in place to put persons on uncollectible status for past-due state taxes owed. Federal law protects Social Security, pension, Social Security Disability (SSDI) and VA benefits from garnishment by states for taxes owed. Unfortunately, not all state taxing agencies will tell seniors that their income is protected from garnishment; instead, they continue collection efforts.

If a senior’s bank account is garnished by a state tax collector, twice the amount of monthly Social Security deposited into the bank account is automatically protected from garnishment, no matter the source of funds in the account at that time. Federal banking regulations require a bank to determine an account into which Social Security is deposited and disregard any garnishment, including for past-due state taxes owed. If there are excess funds from exempt sources in the account, a claim of exemption would need to be filed with the state before the money could be released.

GET PROFESSIONAL IRS HELP

CALL THE FLAT FEE TAX SERVICE, INC.

IRS TAX HELP PHONE:

1-800-589-3078

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