Payroll Tax Debt can be a true nightmare for a taxpayer. It can impact both the business of the taxpayer, as well as put their own personal assets at risk. It’s critical to understand these issues when working resolve tax debt related to payroll.   When taxpayer’s come into our Richardson TX office with Payroll tax debt, we make special efforts to educate them and work to resolve the tax debt, while minimizing their potential personal exposure. This article is the first in a series of articles related to payroll tax. Today will be an overview of the consequences of Not Timely Making Payroll Tax Deposits timely.  Payroll taxes are becoming a higher priority for the IRS and Department of Justice (DOJ). In 2015, 68.6% of the IRS’s Revenue collection is through payroll withholding. There ar... 05/26/2019

In our last blog installment, we had an overview discussion on IRS Tax Penalties including a brief overview of Tax Penalty Relief. If you’re like most clients who come into my Richardson TX office with Tax Penalties, they feel that the IRS should just remove their tax penalties. As discussed, the IRS does not simply remove penalties upon request. It is the government’s position that penalties serve as a valuable tool in compliance. However, in certain situations that is possible. Today, we’ll dig into those alternatives a little further.  First Time Penalty Abatement – If the taxpayer qualifies, this is typically the easiest way to remove a penalty. The First Time Penalty Abatement (FTA) is available for 3 penalties – Failure to File Failure to Pay Failure to Deposit (Payroll Deposits) ... 05/24/2019

Have you ever heard the late night commercials where the person says that they can remove all of your IRS penalties?   We often get taxpayers who come into our Richardson, TX office have hard the commercials, and they want to know how they can have all of their penalties removed. The reality is in some cases, it is possible, but it depends on your situation. Today, I’ll give an overview of tax penalties and a quick discussion on penalty relief.   In the next week, we’ll cover the topics in more depth. Unfortunately, the IRS does not simply remove penalties as a matter of procedure. From the government’s perspective, there are legitimate reasons for penalties. The IRS lists several purposes of penalties in the Internal Revenue Manual (IRM). One purpose of penalties is to encourage timely... 05/21/2019

When taxpayer’s come into my office in Richardson, TX related to IRS tax debt problems, IRS Liens are often the major issue they are working to resolve, and taxpayers want to know how to get rid of an IRS lien.   As mentioned in a previous blog, there are two types of liens – General or “Silent Lien” – automatic by statute.  No one including the taxpayer is notified. A Notice of Federal Tax Lien (NFTL) – publicly filed  The NFTL is what causes pain to the Taxpayer, harming their ability to access credit and transfer assets.  The IRS is permitted to file an NFTL on tax debts > $10,000 and typically does.  When an IRS lien is filed, in most cases, unless the tax debt is paid off, the lien remains. Here are a few ways to have a lien discharged or released – Pay the tax debt off in full, Fi... 05/19/2019

When taxpayer’s come into my office in Richardson, TX related to IRS tax debt issues, threat of or Notice of a Federal Tax Lien is one of the major reasons. Taxpayers often don’t understand the process, how a Tax Lien impacts them, and what they can do to avoid one or remove one. This is one in a series of articles discussing the IRS Tax Lien.   The Types of LiensThere are two types of liens that Congress has authorized the IRS to use under Section 6321 of the Internal Revenue Code, to use when a taxpayer is liable to pay any tax, and fails to pay the tax after a demand by the government for payment. The two types of liens are known as: The general lien, better known as the “Silent Lien”, and The Notice of Federal Tax Lien (NFTL)  In the last installment of our series on the IRS Tax Lie... 05/17/2019

When taxpayer’s come into my office in Richardson, TX related to IRS tax debt issues, one of the major reasons is that either they fear a lien or have received a Notice of Federal Tax Lien. Taxpayers often don’t understand the process, how a Tax Lien impacts them, and what they can do to avoid one or remove one. This is one in a series of articles discussing the IRS Tax Lien.   The Types of LiensThere are two types of liens that Congress has authorized the IRS to use under Section 6321 of the Internal Revenue Code, to use when a taxpayer is liable to pay any tax, and fails to pay the tax after a demand by the government for payment. The two types of liens are known as: The General Lien, better known as the “Silent Lien”, and The Notice of Federal Tax Lien (NFTL)  Today we will focus on ... 05/15/2019

I manage a tax practice in Richardson, TX, and one of the major issues that taxpayers come to me with are problems related to IRS Liens. Taxpayers often don’t understand the process, how a Tax Lien impacts them, and what they can do to avoid one or remove one. This is the first in several articles that I will write on the lien process. In the following articles, I will dig deeper into the process as well as what to do if the IRS places a lien on your assets. The Impact of the Tax LienAn IRS lien is a very powerful tool for the IRS. It attaches to all property owned or acquired after the lien is issued. For example, if a taxpayer purchases property while under the lien or acquires it in another manner such as inheritance, the lien will attach to those assets as well.   However, there is ... 05/12/2019

  Address SqFt Total Beds  Full Baths Half Baths Pool Current Price 100 Brookwood Drive 1,614 3 2   No $250,000 428 Grace Drive 1,285 3 1 1 No $254,900 2108 Oak Brook Drive 2,084 5 3   No $259,000 2013 Meredith Lane 1,690 3 2   No $262,000 618 Scottsdale Drive 1,408 3 1 1 No $269,800 1128 Pacific Drive 1,359 3 2   Yes $269,900 705 Nottingham Drive 1,718 3 1 1 No $270,000 1202 Dearborn Drive 1,472 4 2   No $274,000 1813 Hanover Drive 1,940 4 2   Yes $274,990 602 Sherwood Drive 1,315 3 2   No $275,000 427 Sandy Trail 1,540 3 2   No $279,686 1416 Somerset Place 2,059 4 2   No $279,900 916 Sandalwood Avenue 1,957 3 2   No $279,900 633 Nottingham Drive 1,433 3 2   No $280,000 1115 Kenshire Lane 2,747 3 2 1 Yes $284,900 708 Gaylewood Drive 1,856 3 2   No $286,000 1800 Auburn Drive 2,423 5 2  ... 05/10/2019

The Tax LevyThe Levy is a powerful tool available to the IRS to deal with delinquent taxpayers. It quickly gets the Taxpayer’s attention and is the most common reason that new clients come to our Richardson, TX office. There are many different types of assets that the IRS can levy. One of these categories are Retirement Accounts. Some people believe that the IRS cannot touch retirement accounts, however, that is not true. Today, we’ll discuss what the IRS can and cannot levy in regards to Retirement Accounts. The IRS and Retirement Accounts The IRS is exempt from the anti-alienation provisions of REISA have no effect against an IRS levy. As a general rule, the IRS does not like to take monies from a retirement plan, but this “may” be an option for the IRS. Essentially, the IRS has the r... 05/10/2019

The Tax LevyThe Tax Levy is probably the IRS’s most potent tool to deal with delinquent taxpayers. It quickly gets the Taxpayer’s attention and is the most common reason that new clients come to our Richardson, TX office. In prior blogs, we’ve discussed the Levy Process and what to do if you find yourself levied. In this installment of the IRS Levy series, we’ll take a look at what the IRS CAN NOT levy.  What the IRS Can’t Levy Certain Property is Exempt from Levy. This Property includes – 85% of Unemployment Benefits (Meaning 15% is available for levy) 85% of Worker’s Compensation Payments 85% of Certain Public Assistance Payments including Social Security Certain Annuity and Pension Payments (will be covered in more depth in a future blog) Judgments for Support of Minor Children Certa... 05/05/2019

A tax levy is the actual seizure of a taxpayer’s property by the government in order to resolve delinquent tax debt. The tax levy is probably the IRS’s most potent tool to deal with delinquent taxpayers. It quickly gets the Taxpayer’s attention and is the most common reason that new clients come to our Richardson, TX office. The IRS issues tax levies after they have sent several notices to the taxpayer that have gone unanswered, or the taxpayer has failed to stick to an agreement. What You Should Do If You Receive a Final Notice of Intent to Levy?Before you are levied, you will receive a Final Notice of Intent to Levy. At that time, you will also receive notice of your right to a Collection Due Process (CDP) hearing. You can request a CDP hearing by filing IRS Form 12153 within 30 days ... 04/30/2019

The Tax Levy is probably the IRS’s most potent tool to deal with delinquent taxpayers. It quickly gets the Taxpayer’s attention and is the most common reason that new clients come to our Richardson, TX office.  Types of Levies A regular levy is a levy that is effective against only the taxpayer’s property being held at the time the levy is served. Examples are Bank levies, levies on receivables, and retirement accounts. As an example, here’s how a regular levy works for a bank levy. Banks will hold money for days before sending it to the IRS.On Day 1, bank receives a notice of levy for a customer. At the time the levy was received, the bank balance was $100. The next day, the customer gets a deposit for $25,000. The amount that is held by the bank to forward to the IRS is $100, the amou... 04/28/2019

How Do Tax Levies Work?Probably the most frequent reason that I have clients come into my Richardson, TX office, related to IRS debt, are when they are levied by the IRS. Being levied, or even the threat of a levy, is a horrible experience for most people, and when it happens, taxpayers are either extremely frightened or angry when they come to my office. This is understandable and we often work with clients to remove the levies and get life back to normal.  Today, we’ll address the overall process. In our next blog, we will discuss in greater detail how to have a Levy released. What is a Tax Levy and Why Does the IRS Levy Taxpayer’s Assets?A levy is the taking of the taxpayer’s property. IRC 6331 authorizes the IRS to levy to collect delinquent tax. This includes any property, or right... 04/25/2019

With most of my tax clients that come into our Richardson, TX, tax office, they get their tax returns filed timely, and are either able to pay their taxes timely, or we immediately get them set up a payment alternative early on and minimize the problem. However, I often do meet with taxpayers who come to us and who 1) did not file their returns timely, and due to a variety of circumstances, 2) did not pay the balance due. Often years go by, and eventually they get a point of a bank or wage levy, a seizure of an asset, or some event triggered by the IRS’s enforcement actions, that creates chaos in their lives. At that point, they’re terrified, or sometimes incredibly angry, don’t know what to do and come to us. The goods news is there is help. The IRS is more than happy to work with taxp... 04/19/2019

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