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Posts Tagged ‘Irs Tax’

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Debt owed to the Internal Revenue Service (IRS) is called IRS debt or tax debt. IRS debt may be a very stressful situation for a consumer to deal with. When tackling one?s IRS debt, the first step in doing so is deciding if one should do it alone or use a tax debt professional. It is recommended if one owes $10,000 or more in tax debt to utilize the services of an IRS debt professional.

Nothing creates a sinking feeling in the pit of your stomach like getting a letter from the IRS tax department Dallas saying that you owe them money. It can literally make you sick. There have been cases where the IRS has even driven people to suicide over debt that was not even theirs. If you find that you owe IRS tax in Dallas, there are options open to you. The first thing that you need to do is to take a deep breath and relax. The second is to gather up all of your information in your favor and call the IRS to see if you can work it out yourself. If all else fails, you can hire an IRS tax attorney in Dallas to help you with the problem.
Getting the letter
Most people would rather face anything else and are terrified of the IRS. Opening up the mail and finding out that you have been audited or owe the IRS tax Dallas a lot of money can strike fear in the mightiest of people. The IRS seems to be a giant conglomerate that can wreak havoc at will on anything it comes near. If they want your house, car, boat or paycheck, they can simply garnish it. Nobody looks forward to receiving a letter from the IRS saying that they owe money, especially when it is a great deal of money. In some cases, people have received letters from taxes that they filed 7 years ago saying that they owed a lot of money that included interest and penalties.
Gathering the documents
The IRS audits department in Dallas has to provide you with documentation if you do not have it. You have a right, under the Freedom of Information Act, to request copies of your tax return as well as tax returns that the IRS have filed on your behalf. You also have a right to get the IRS transcripts of your case. You can request that the IRS tax Dallas representative send these to you. They will most likely require your signature on the Freedom of Information Act. Once you have gathered the documents, you can look to see what type errors that they contain that is causing you to owe money.
Bargaining with the IRS
If it turns out that you do owe the IRS money, you can attempt to bargain with them. However, you stand a better chance of bargaining with the IRS tax department in Dallas when you have nothing to lose. If you are out of work and have no real assets, chances are the IRS will be more forgiving with your debt. If, however, you have a job and home as well as other tangible assets, the IRS audits department will be less inclined to reduce your debt unless you have an attorney who is representing you.
How to find an IRS Tax Attorney in Dallas
When you look for an attorney to help you with your IRS tax in Dallas, look for one that will charge you a flat rate rather than by the hour as it can be time consuming to resolve the problem. Before the IRS problems get to be too much for you, put them in the hands of an experienced tax attorney.

The tax system in the United States is known as a voluntary compliance one. This means simply you voluntarily report your financial information and hand over the mulla. If you don?t, then the involuntary part of the equation comes into play. This is better known as the IRS audit. The fear of an audit can bring many grown men to tears, but the fear of going to jail from an IRS action is even greater. So, is there any real risk the IRS is going to put you in jail? Let?s start off with a simple thought. What is the purpose of the IRS? The purpose is to collect tax revenue for the federal government. The agency goes about that in a number of ways. The primary method for ?encouraging? compliance is to do audits. In these audits, the agent for the IRS looks for people underreporting income or overstating deductions. So, what if the agent finds something? In the massively vast majority of cases, an audit that turns up something is going to result in the assessment of further taxes, interest on those taxes and penalties. You?ll not jail time is not mentioned anywhere in that. Why? Well, it is hard to pay the IRS if you are sitting in a cell. The IRS is in the business of maximizing the ?milk from the cow?. Putting the cow in jail doesn?t accomplish that. I can see you thinking it now:?Yeah, but I?ve heard all kinds of horror stories about the IRS. What about that actor who was put on trial for tax fraud? What about that race car driver? I also read about a tax attorney going to jail.? These are all true. The IRS does put famous people on trial. Why? Because they are famous! What better way to ?encourage? us regular folks to pay than if the IRS puts the winner of Survivor in jail? A certain amount of fear goes a long way when it comes to collecting taxes! As for tax attorneys and CPAs who are indicted, the IRS is definitely going to take a grim view towards those that are promoting strategies to illegally evade paying taxes. The tax code is complex. Money Magazine used to do study every year where it would send out the finances of a fictional family and ask 10 different CPAs to prepare their taxes. All the CPA would come up with different returns and only one would be close to the correct answer. Did that mean the other nine fictional clients were going to jail? Of course, not. They would have to pay a bit more, however.As long as you try to play straight on your taxes, you have nothing to fear. Try something clever, however, and all bets are off.

Will you ever get an audit for a tax return 5 years or more ago?

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Are tax returns really the commodity that they are often perceived to be? Is a tax return prepared by the tax service in the mall of the same quality as that prepared by a major CPA firm?

What does it mean to have a “quality” tax return? In fact, can a tax return be prepared in such a way as to reduce income taxes or reduce audit risk?

As someone who has been involved in the tax return preparation process for almost 30 years, let me share some thoughts on this subject.

In all the firms and companies I’ve worked, the basic accuracy of tax return preparation was excellent. There was always a good review process and I don’t believe there were major mistakes on very many returns produced by these firms. I find this also to be the case on returns that I see from clients who are new to ProVision. It’s rare that I find a flagrant error in a return.

But does that mean that these firms all produce the same quality of tax return? The clear answer in my experience is a resounding “NO!” Let me explain.

Accuracy in a tax return simply means that the information provided by the client was reflected on the tax return. It does not mean that the tax return was prepared in the BEST way it could have been prepared. In fact, I RARELY see a tax return from a new client that was prepared the way we would prepare it at ProVision.

Tax Return Preparation Either Always Reduces or Increases Your Audit Risk Let me give you some examples.

Example #1: Where you claim your deductions matters Suppose you have some expenses that could either qualify as investment expenses or business expenses. Either classification would be “deductible” on the tax return. BUT, a business expense is MORE DEDUCTIBLE than an investment expense.

How is that possible? An investment expense is deducted on Schedule A and is classified as a “Miscellaneous Itemized Deduction.” There are several limitations on a miscellaneous itemized deduction. First, you only get to deduct these type of expenses to the extent they exceed 2% of your income. So, if you have $300,000 of income and $7,000 of investment expenses, you only get to deduct $1,000. What’s worse is that if you are in the Alternative Minimum Tax like millions of taxpayers, you don’t get any benefit for your investment expenses.

How does this relate to audit risk? Miscellaneous itemized deductions tend to be more heavily scrutinized by the IRS, so they have a tendency to increase audit risk. In this case, how your tax return is prepared not only impacts how much you pay in tax, but also your audit risk.

Example #2: Tax return preparation matters even when you owe no tax Many taxpayers believe that their audit risk is low because they don’t have any tax liability, so who and how their tax return is prepared doesn’t matter. This is not necessarily true! Here’s why:

Losses reported on Schedule C are commonly scrutinized because of the possibility of hobby losses (turning a personal activity into a “business” but not putting in the effort to turn a profit which makes the activity a non-deductible hobby activity in the eyes of the IRS).

Losses reported on Schedule E for rental real estate are commonly scrutinized to make sure the rental losses are indeed deductible. The rules in this area can be very complicated so the IRS is on high alert to catch errors.

Having no tax liability does not mean you are off the hook when it comes to audits!

Behind Every Secret Remember, behind every one of my secrets is knowledge – the type of knowledge that makes you aware of what creates massive tax savings so you begin to see your daily routine a little differently…like how to reduce your audit risk even while you are reducing your taxes!

Reduce your taxes now!

They audit people and business, why not our politicians and our tax dollars?

By, Jones & Ryan

Dealing with the IRS and related tax problems can be anyone’s worst nightmare. Once the IRS has begun to go after you, it can seem that they won’t stop even after you think they have gotten what they want. The tax lawyers of Jones & Ryan have been working since 1995 to solve such nightmares. Grey W. Jones, Esq. and Cheryl L. Ryan, Esq. are tax attorneys with extensive knowledge in tax law and today want to answer some of your common tax questions for free. Below you will find four answers to common tax and IRS related questions. If you wish to find more in-depth answers and get more tax help our website offers an extensive frequently asked tax questions section that we are constantly updating, as well as, a simple tax help questionnaire to start a free initial consultation with our tax lawyers.

Why did the IRS file a tax lien against me? A tax lien, usually filed with your county recorder, serves as notice to those who may loan you money (home or car loan, bank loan, credit card advances, etc.) that once the lien is filed, the IRS? claim against you for taxes will come before those of anyone loaning you money after the filing. With certain exceptions it attaches to all property, real and personal, tangible and intangible, in which you have an interest, wherever the property may be located. A lien does not result in the actual seizure of any property, real estate or other forms. Further, before the IRS can file a lien against your property, it should give you 30-day notification that it intends to do so. This may give you time to make a payment or other arrangements.Can the IRS levy on my house? On my wages? On my bank accounts? What about retirement funds?

A levy usually means the property is actually seized by the IRS. In the case of real estate, it means the IRS can force a sale of the property and keep the proceeds up to the amount of taxes, penalties and interest owed. A certain portion of wages and commissions are exempt from levy; the amount depends on a number of factors, including the number of dependents. All forms of bank accounts?savings, checking and CDs?are subject to a levy in full. In order to catch subsequent deposits, the IRS must serve a new levy on the bank. Once wages are levied upon, the same levy reaches all subsequent wages, commissions, bonuses, etc. No forms of retirement funds are exempt from levy, including social security payments and other forms of government pensions. However, unemployment and workers? compensation benefits are exempt from levy, as are SSI and some forms of public assistance. A small amount of household and personal effects, and tolls and equipment used in the taxpayer?s trade or business, are exempt from levy.The IRS is garnishing my wages. How can I stop them?

The IRS will garnish your wages after proper notice. All the IRS wants is payment or a good reason why you can?t pay. This is when you can negotiate a payment plan or an Offer in Compromise or convince the agency you are worthy of uncollectible status. It is imperative after you receive a notice of ?Intent to Levy? that you deal with it immediately. Intents to Levy are time-sensitive and if you miss your deadline to reply, i.e. make payment arrangements, your employer will be made aware of the situation and your wages may be garnished. If you?re not sure how to go about this, consult a qualified tax attorney to assist you.When is the right time to consult an attorney?

There are various reasons you would need to consult an attorney such as: fraud investigation, a long audit or one that involves legal issues, inadequate books/records, not filing returns for a number of years, if you don?t actually owe taxes, if the statute of limitations has run out or if you would feel more comfortable dealing with the IRS through an attorney. Whatever the reason, don?t hesitate to contact an experienced tax attorney to help you through your foray into the wide world of IRS red tape. Many law firms including Jones & Ryan offer free initial consultations to better understand your situation and decide how they can help. The Jones and Ryan Tax Attorney website offers an extensive frequently asked tax questions and answers page. You will also find free tax articles as well as information about our lawyers, firm, initial free consultation, and how to get in contact with us.

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