As we discussed over the past few weeks, many of the taxpayers who come into our Richardson, TX, office want to know more about the IRS Offer-In-Compromise program. When you choose to make an Offer to the government, there are two main types of settlement options to choose from. These two options differ in how the offer is calculated and when the payments need to be made. The two options are - The Lump Sum Offer, and The Deferred Offer  Lump Sum Offer – $186 Application Fee (Non-Refundable) plus 20% down when offer is made. If offer is rejected, taxpayer loses the down payment. The remaining five or fewer payments are made within six months after the OIC is accepted by the government. RCP formula is Net Assets + Monthly available Income times 12 months.  Deferred Offer – $186 Applicatio... 04/14/2019

  As the old saying goes, “There are only two certainties in life: death and taxes.” Have you ever wondered what would happen if you filed your tax return late or worse, did not file at all? Well, you are looking for trouble if you do not file your tax return.  There will be a penalty for not filing your return equaling 5% per month up to 25% of the tax due. Then, there is another penalty of .5% per month up to 25% of the tax due for failure to pay the tax. An example is if you owe $1000, it will cost you $250 penalty for not filing, but only a $5 penalty for not paying. That doesn’t include Interest! The lesson that should be learned is that you should file your return even if you can’t pay the tax today. If you qualify for a refund and wait more than 3 years to file your return, the I... 04/11/2019

Quickbooks and accounting software similar to Quickbooks, such as Xero, are now commonly used by small business owners to track their accounting records. For a fairly small price, it enables businesses to have financial reports, to assist them in running their business, and provides a database where they can store their financial records for many years.  The IRS is very interested in the value of the information contained in the file, wants to get access to it, and yes, they will get access to it, as part of an audit.  The IRS has the authority to access to these electronic files under the IRC, and the courts have backed up this right, in several cases. The reason that they want this information is not so they can’t only see the final reports provided by the Taxpayer, but it allows them... 03/17/2019

I have clients come into my Richardson, TX tax office wanting to sell their homes but believing that they are unable to due to an IRS lien filed against it.  The good news is that not only can you sell your home, but the IRS will be happy to allow you to sell your home, as long as it does not negatively impact them. The IRS will not permit the home owner to walk away with money that could have been received by the government.  Let’s walk through a few scenario’s to illustrate what would happen in a sale on a property with a tax lien. For these scenario’s let’s assume that the Taxpayer owes the IRS $100,000. Here are three different scenario’s and how each would work - Scenario One – Home is sold for $300,000 (net) and the bank has a mortgage balance is $150,000. In this case, $150,000 w... 03/13/2019

Paying Employees is a critical function for business owners. If an employer doesn’t pay their employees timely, they will not have a staff to operate their business. What happens when your company pays its employees but doesn’t file Payroll Tax filings timely or doesn’t make deposits for payroll taxes timely? Since I’m in Richardson Texas, we will focus on penalties from the IRS and the State of Texas.  What Are the Most Common Penalties?The IRS has Penalties for both Late Filing and Late Deposits - Failure to File Penalties - For Quarterly Form 941 and Annual Form 940 are up to a maximum of 25%. Failure to Make Payroll Deposits Timely - add up quickly with 15% if not paid within 10 days after the IRS bill is received for Form 941 Deposits. Failure to Pay Timely - If not paid by the tim... 03/10/2019

The best and easist solution for many of my clients in the Plano and Richardson areas of Texas, who come to me owing the IRS, is to set up on a Streamlined Installment Agreement. There are a few different types of Installment agreements that I covered last week. These included a Streamlined Agreement, Regular Agreement, and Partial Pay Agreement.  Regular Agreements and Partial Pay Agreements require that the Taxpayer complete and provide a Copy of a Form 433 to the IRS and the IRS must approve the installment payment amount. Form 433 can be confusing can be time consuming for Taxpayers who need to complete it and waiting for IRS approval can be stressful.  Streamlined agreements, on the other hand, don’t require the completion of Form 433 and do not require IRS approval if the Taxpayer... 02/24/2019

I represent taxpayers in Richardson, TX as well as our cities within Texas.  When I meet with clients, the best solution for many of them is to set up an Installment Agreement.  An Installment agreement is a repayment plan with the IRS over time. However, all Installment Agreements are not alike. There are three different types of Installment Agreements that I’ve outlined below. My goal is that after reading about each of them, you will have a better understanding of which one is the right one for you. Streamlined Agreement -  To qualify, must have Individual Tax Debt under $50,000 and the offer must pay off the debt within 72 months or with the time period the government has to collect the tax. These are pretty easy to set up either online at irs.gov or via mail and No Form 433 require... 02/21/2019

Veterans now have access to a new VA renovation loan to refurbish or remodel their homes.  This loan program is available for new home purchases as well as for remodeling homes currently owned by the veteran.  It is estimated that over 50% of homes nationally are 40 years or older, and in the current housing market many homes are in need of updating, addressing deferred maintenance, or improving the energy efficiency of homes to lower utility costs.VA loan benefits include the following unique advantages:  a.  up to 100% financing, b.  no mortgage insurance, c.  up to $ 35,000 in renovation funds escrowed, d.  all renovations must be completed within 60 days of closing, e.  you can close on a purchase or refinance in the “as is” condition, f. you can borrow against the future value of t... 02/20/2019

With the largest tax law update in over 30 years, navigating the course with the new laws can be confusing. Businesses need to be aware of these changes and consult with their tax professional to get advice so they can be knowledgeable of their options.  Although the TCJA was first signed into law over a year ago, the impact is just being understood for a lot of new tax clients that I meet in the Richardson and Plano area of Texas.Major Tax Changes for Small Businesses The tax rate for C Corporation was changed to a flat 21% rate.  For most businesses, this will be a substantial reduction, but for C Corps that were previously taxed at the bottom 15% rate, they may see their taxes increase and want to explore other entity options. The Tax law changes don’t leave out small Non C-Corporati... 02/16/2019

What is Currently Not Status?Currently Not Collectible Status (CNC) with the IRS means that the IRS has determined that according to their guidelines, the taxpayer does not have the ability to make monthly payments. The taxpayer’s income is used up by or exceeded by allowable expenses and does not have any net equity available to pay the amount owed.  What actions will the government take if the Taxpayer is CNC?If the government codes the taxpayer’s account as Uncollectible, they still owe the tax and the government may still file a Notice of Federal Tax Lien (FTL) on current or future assets, However, there are some benefits to being in CNC: While in CNC, the government won’t but won’t take any levy action, and The 10 Year Statute of Collecctions for the IRS continues to run. Note that... 02/13/2019

What is Your Best Option for IRS Tax Debt – Uncollectible Status, Installment Agreement, or an Offer In Compromise. When I meet with clients in my Richardson, TX office, after meeting with them to hear their story, pulling their tax transcripts to get a full and accurate view of their tax issues and history, and getting them in compliance if needed, we begin to work on a strategy to resolve their tax issue with the IRS. This generally involves three alternatives –  Offer In Compromise  Installment Agreement Currently Not Collectable There are others including bankruptcy and Innocent Spouse Relief but we will focus on the three most common options. Offer In Compromise (OIC)An Offer In Compromise is what you often hear about on TV and in with other advertising, where you pay pennies on th... 02/10/2019

This home is a rare find in Richardson and now it can be yours! 9 Briarwood Circle is for sale!Situated on a .6+ acre lot with a creek running through it, this 4 bedroom home on a cul-de-sac has 3 full and 2 half baths. Two bedrooms, including the master suite, are on the first floor. The two upstairs bedrooms share one of the baths and there is a large game room just outside their doors.  Under two dormer windows are built-in desks and one of the upstairs bedrooms also has adjoining flex space with built-ins.There is abundant closet space throughout the house, and plenty of counter space in the kitchen. There is even a second prep area off the kitchen with its own sink.But it's the creek and the lot that make this property special. This is the view that greets you upon entering:And as ... 02/10/2019

Why Are Tax Transcripts Important When Resolving IRS Debt?When Taxpayers come to me in my tax practice in Richardson, TX seeking relief from tax debt, the most critical place for me to start to understand their problem and how to address it is by Pulling their Tax Transcripts. While the taxpayer has a lot of important information that can help me to understand their issues by interviewing them and looking at their documents, but by pulling transcripts, I can immediately get a very clear look at the big picture of what the issues are and develop a plan on how to address their tax issues. As a taxpayer with debt who wants to resolve issues on their own, you should also take this action.  What are the Advantages of Pulling Transcripts?Below are just some of the reasons that I find pulling ... 02/08/2019

There is a limit on how long the IRS has to Collect Tax Debt?It may surprise you, but the IRS has 10 years from the date of assessment to collect a tax debt from taxpayers including my clients in Richardson and Plano, TX. In most cases, after 10 years, the debt becomes uncollectible by the IRS. There are certain exceptions that may delay or toll the 10 year time limit. We’ll cover those below, but in general, without any actions by the taxpayer which stock the clock, once the 10 years are up, the IRS has to stop its collection efforts and the debt becomes unenforceable. How is the 10 Year Statute calculated?The calculation begins on the date that the tax is assessed, not the date the tax is filed. If you electronically filed the return, it is typically the same day. Mailed returns are a... 02/03/2019

As I’ve stated in other articles, as of the end of 2017, there were over 14 million taxpayers in some stage of the collection process with the IRS and many of those taxpayers are in Richardson, TX and throughout the DFW vicinity. While these issues can seem insurmountable, you can resolve them if you take the proper actions. How do you Solve Your Tax Problems?While there are several methods to resolve your tax debt including Installment Payments, Offers in Compromise (OIC), and being placed in Currently Uncollectible Status, until you get into Tax Compliance, these are not viable options until you get into tax compliance.  Once you are in compliance, you can then discuss agreements with the IRS. What is Tax Compliance? All Tax Returns have been filed that are due as of this date (Prior ... 01/27/2019

The benefits of a preapproval (not prequalification) for Richardson TX Home Loans. Many consumers are not informed on the proper way for buying a home. No question, this is a big decision, and one that can be either immensely stressful- or immensely enjoyable- depending on how you go about the home buying process of Richardson TX Home Loans and the surrounding areas. The key is to take the proper steps to educate yourself on your buying power, initial investment, and taking some time to think about your lifestyle choices. This article will cover all of these.   Education   The steps necessary to purchasing a home in Richardson, Texas starts with getting pre-approved for your home loan. Notice we did not say get prequalified- in today’s world a prequalification is not meaningful. You sho... 01/23/2019

Many of my clients in the Richardson, TX area, a suburb of Dallas, TX, get in the IRS collection queue where they receive a litany of notices.  Among those notices, is what I refer to the final collection warning notice.This notice can be a Letter 11 (LT 11), CP 90 or Letter 1058, depending on which area of the IRS is handling your case and sends the letter. Whichever of these three letters you receive, they’re basically all the same, and they all have the same purpose. This is a critical notice that gives the Taxpayer certain rights as well as an opportunity for time to resolve their case. These notices give the Taxpayer 30 days to request a CDP (Collection Due Process Hearing) by filing Form 12153.The CDP hearing gives you the ability to state your case as to why the IRS should not le... 01/20/2019

The Tax Cuts and Jobs Act of 2018 (TCJA) had an impact on a number of industries.  This included the rules for Real Estate investors, Brokers (Both of which I’ll cover at a later date) as well as Real Estate Agents in the Richardson, TX area and nationwide, which I’ll cover today.  Impact on HomeownersOn a more general level, here are some of the tax changes that may impact your potential clients in the market for real estate Limitation of State and Local income Tax and Property Tax of $10,000  Mortgage Interest Changes for Debt incurred after December 15th, 2017 Reduced Limit to first $750,000 of Debt for the Mortgage Interest Deduction.  Changes to the Deduction of Home Equity Debt Investment Real Estate has NO Mortgage Interest or Real Estate Tax Limitations, Expansion of Secction 17... 01/17/2019

The IRS Collection Process Can Be Confusing and Frustrating!As of the end of 2017, there were over 14 million taxpayers in some stage of the collection process and many of those taxpayers were in the Plano and Richardson area in Texas.  If you are one of those taxpayers, you will find yourself receiving a number notices from the IRS. Those notices can create a wide range of reactions from taxpayers that range from complete fear to irritation to no reaction.  If you don’t react in the correct manner within the appropriate timeline, you may find yourself with liens or levies or with loss of rights in the collection process. Our goal here is to help our neighbors in Plano and Richardson, TX and beyond what each of those notices mean. What are the notices I can expect to Receive?Along the c... 01/13/2019

    Navigating the IRS Collection Process in Richardson, TXAs of the end of 2016, there were over 14 million taxpayers in some stage of the collection process an many of those taxpayers were in Dallas, TX.  If you don't solve your tax problems timely, you can expect levies, liens, a negative impact on your credit, and stress in your daily life and relationships that is unneccessary. You can end up with your bank accounts levies, or a lien on your home.  We have experience in helping Richardson, TX and DFW Taxpayers navigate the system and resolve their tax collection problems.   How do you Solve Your Tax Problems?There are several different methods of settling collection issues. Fully pay the debt. That's the simplest solution but will require an immediate full payment of the tax debt. ... 01/06/2019