Video instructions and help with filling out and completing What Form 843 Reduction

Instructions and Help about What Form 843 Reduction

Hi I'm taxi PA Jim Tripp on with some words of Education on IRS tax settlements hires tax settlements can be done with IRS payment plans tax negotiation and using something called an offer and compromise here's what to do first IRA's tax settlements usually come into play in one of two situations first when the taxpayer owes money to the IRS that they can't pay in full immediately they may be able to make some form of settlement or when the IRS claims the taxpayer owes money and the taxpayer disagrees as a CPA with almost 30 years of experience settling IRS tax debts I can tell you from experience there are three steps and successfully settling the tax debt they are number one assessing your tax situation number two devising a workable IRS strategy and three making the tax settlement deal so let's look first at assessing your taxation this tax situation tests the first step in a settlement if you receive several notices from the IRS pull them out let's review them is the IRAs clear about what they're trying to collect for next get a copy the tax return involved check it to get a handle if you really owe the tax sometimes taxpayers make mistakes on their tax returns and they really do owe money to the IRS but almost this frequency and many times the mistake is made by the IRS and not the taxpayer I remember a very interesting study by the done by the Government Accounting Office several years ago the government's own account studied a sample of IRS notices and found an alarming percentage either contained errors or attempted to collect penalties and interests that weren't even owed now of course if you're working with an inexperienced tax advisor who might be more scared of the IRS than you are the advice are likely to get is to just pay the bill but what if you don't know the tax or even worse what if you don't have the money well really the first step in any tax element is to assess what is truly owed if there's a legitimate basis to argue the tax was assessed in error now let's look at the next thing devising a strategy once you've reviewed the IRS notices and your tax records one of two situations is going to exist either you agree all the money or you disagree with what the IRS is claiming now if you disagree with the IRS you're straight you should be one to challenge the tax that they're attempting to collect how this is best done depends on how much is owed and how old the tax that is for example if the IRS closed claims you owe a couple of hundred dollars generally this type of situation can be resolved by correspondence if you have good records you can provide them to the IRS to prove you don't owe any money but remember always send photocopies and keep the original records safe in your files now on the other hand if the IRS claims you owe thousands of dollars your strategy will probably need to be a little bit different in this type of situation it can take some face-to-face time with the IRS collections officer to clean up the mess for example you may need the files and past due tax returns if the IRS has filed was called estimated returns for you or you may need to provide documentation for why you don't owe the tax even if you agree oh the tax that the IRS is attempting to collect you may still have a reasonable cause to reduce the penalties and interest or negotiated a discounted lump sum payoff this can either be done with an installment agreement in the case of paying overtime and sometimes even reducing penalties and interest with that or through a process called offer and compromise in the case of trying to use a discounted lump sum payoff now if you know thousands of dollars your strategy really should be designed by tax professional assuming you're not related to an IRS tax accountant you can call our office at seven one three six six one 1040 and hire us to assess your situation and develop a customized strategy for you now next let's talk about making the IRS tax on my deal the final step in this process is to make the deal the method of doing this will vary depending once again on how much is owed or the IRS claims is own for very small tax debts like I've already noted you can usually resolve those type of deals by correspondence for mid-sized debts where you may be maybe will make your full payment via monthly installments over twelve to twenty-four months you normally can make that type of deal with the IRS over the telephone now for large tax debts anywhere from ten thousand dollars to several millions of dollars we'll often need to have a live conference or a series of conferences with an IRS collection officer or appeals group if you need that kind of service our CPA firm can help and we can do this for clients who live in all 50 states if you need help settling an IRS debt we can represent you so call us at tripod and company CPAs at seven one three six six one 1040 we represent tax clients in all 50 states and our phones are answered 24 hours a day seven days a week call us at seven one three six six one 1040 put our almost 30 years experience to work for you today