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If you owe unpaid back taxes to the IRS, tax resolution firms can help you negotiate a settlement or a payment plan that makes your IRS tax debt more affordable. These firms are typically run by tax attorneys or certified public accountants (CPAs) who have the knowledge, experience, and authority to work with federal and state tax authorities on your behalf.
Services Provided by IRS Tax Debt Resolution Firms
Tax resolution firms work with individuals and businesses to resolve complicated tax issues. They provide a range of services which typically include:
Negotiating penalty abatement, in which associated penalties are removed from your past-due tax balance. This is significant since these penalties can add as much as 25 percent to your ...
For one reason or another, many of us may find ourselves in tax debt to the IRS at some point in our lives. Whether it's through forgetfulness, miscalculations when you file your taxes, a major life event, lack of knowledge, or any number of other reasons, sometimes this tax debt gets so high that it can drastically change your life for the worse. Luckily, there are many ways to take your IRS tax debt by the horns and improve your financial situation.
Being in tax debt is not uncommon. It happens to many people. In fact, 17% of federal taxes are not paid every year and collectively, citizens owe the IRS $114.2 billion in back taxes. Being in tax debt to the ...
A tax attorney is a lawyer who has specialized training in the extensive U.S. tax code. in addition to the Juris Doctorate (J.D.) degree that all American attorneys earn, tax attorneys may also obtain a master's degree in tax law and/or have a background as a certified public accountant (CPA). If you have tax issues that relate to legal matters and/or are very complex, a tax attorney can advocate on your behalf.
The Role of a Tax Attorney
This type of lawyer is an expert in the laws and policies about taxation, including IRS guidelines and procedures as well as local, state, and federal laws that affect tax liability. They are knowledgeable about how these tax laws impact many aspects of life ...
States without state income tax are those that do not charge income tax on individual and business income earned from state sources. Although residents and businesses housed in these seven states must still pay income taxes at the federal level, they are free from state income tax, which may represent significant savings.
Two additional states tax only income from dividends and other investments. Although avoiding state income tax may seem appealing, it's important to weigh all the factors, since these states often make up income tax revenue by charging higher taxes in other areas.
States Without State Income Tax
Not only have Alaska residents and businesses been free of state income tax since 1980, but the state also does not ...
An interest rate is charged on past-due IRS debt, including both balances and penalties. The interest rate is tied to rates set by the Federal Reserve.
The current rate for individuals is 5%, which is compounded daily and assessed quarterly. Rates are likely to increase in 2019.
The only way to avoid paying interest on your IRS debt is to pay taxes when they are due. Avoiding penalties can minimize the amount of interest assessed.
IRS interest rates increased as of April 1, 2018. If you are making installment payments on a past-due tax balance, these new rates were assessed on a quarterly basis, beginning the second quarter of this year.
What Are the New Interest Rates?
IRS interest rates ...
The American Taxpayer Relief Act was signed in 2012 to avoid increased tax liabilities that might prolong the recession.
Many provisions of this act have expired and been replaced by provisions in the Tax Cuts and Jobs Act of 2017.
Under the new act, most taxpayers will experience a decreased tax burden for the 2018 tax year.
The American Taxpayer Relief Act of 2012 (ATRA) took effect in January 2013 after it was signed by President Barack Obama. This act extended tax relief programs for up to five years and added some temporary tax cuts established between 2001 and 2010 to the permanent tax code. The latter category includes the changes made in the Economic Growth and Tax Relief Reconciliation Act of ...
Tax attorneys have the knowledge and experience necessary to negotiate with the IRS.
You may want to hire a tax attorney if you are facing more than $10,000, criminal charges, or an audit.
If you owe more in tax than you can afford to pay, a tax attorney can help you find a resolution.
IRS settlement lawyers help taxpayers resolve issues with the IRS. If you are facing a complex tax problem such as an audit or a past-due balance you cannot afford to pay, a qualified tax attorney can advocate on your behalf with the IRS. Here's what you need to know when hiring a lawyer to help with your IRS settlement.
Should I Hire a Tax Attorney?
Tax attorneys have ...
With an offer in compromise, the IRS may settle your tax debt for less than your full liability.
To qualify, you must have documentation showing that repaying the entire amount would cause undue hardship.
If your offer is rejected, you have the right to appeal the IRS decision within 30 days.
The IRS settlement offer form is used to request an offer in compromise (OIC). With this program, the IRS agrees to settle your tax debt for less than the full amount owed. If you cannot afford to pay your past-due tax balance, requesting an offer in compromise can prevent further IRS collection actions.
Is an OIC Right For Me?
The IRS designed this program to assist taxpayers for whom paying ...
The IRS can levy (seize) your assets if you owe taxes you have not made arrangements to repay.
Many taxpayers can avoid a levy by entering into an installment agreement.
Seek help from a tax professional if you can't afford to make even a small monthly payment toward your balance.
An IRS tax levy occurs when a taxpayer ignores tax collection attempts from the agency. The levy allows the IRS to seize wages, bank accounts, real estate, vehicles, business accounts receivable, and other assets to repay the past-due tax debt. If you've received notice of a levy, these are the steps you need to take immediately to protect your property from seizure.
Understanding a Lien vs. a Levy
Although the words lien ...
A California state tax levy allows the state to seize your funds or assets to repay tax debt.
You must act quickly to protect your property if you receive a levy notice from the Franchise Tax Board.
Entering a payment arrangement, paying in full, and successfully seeking hardship status will result in levy release.
California taxpayers can take advantage of several ways to get in touch with the state Franchise Tax Board, including a direct call to the California state tax levy phone number: 800-689-4776. This is especially important if you have unpaid state tax debt and have been issued a levy, which means that your property can be seized if you do not make arrangements to pay your balance.
What Is ...
Solvable is a for-profit company that helps customers resolve their tax problems, but a free service for consumers. Partners cannot pay us to guarantee favorable editorial reviews or ratings. We do not publish favorable (or unfavorable) editorial reviews or assessments at the direction of an advertiser or partner. We always work to put consumers first and do our best to provide value in meaningful ways, but our reviews are subjective.
How We Make Money
Solvable is compensated by some of the companies seen on our website. Most often, Solvable receives fees when one of our readers clicks, fills out a form, applies for, or receives a financial product from one of our partners. We also earn fees for capturing consumer stories and writing about them, displaying advertising, having our partners sponsor certain parts of the site, and writing content that may be relevant to our partner and their audience. This compensation may impact where products appear on this site, including article pages, comparison listings, the order in which they appear or if they will even appear on a given page, and our matching recommendations. Solvable has not written about, reviewed, or rated all financial products available to consumers.
In addition, we may be compensated in the following ways:
Referrals to consumers who use the online form or locator line that may provide expert answers to questions;
Marketing tax resolution, tax preparation, tax audit help and general tax assistance.
Referrals to services that help consumers with tax resolution, tax preparation, tax audit help and other tax issues.
We do recommend that you shop around and compare services and costs with other companies while performing your own due diligence, especially since people’s experiences with companies can change over time.
Free Solvable Services
The offers that you are matched up with are from companies or attorneys/law firms that we may receive compensation from. Based on our initial review of such companies or individuals, we feel comfortable introducing them to our readers. We won’t recommend something just because we’re offered payment to endorse or promote it. However, we do recommend that you shop around and compare services and costs with other companies while performing you own due diligence, especially since people’s experiences with companies can change over time.
We are not attorneys and we don’t provide legal advice. As always, we encourage you to do your homework and check out individuals and companies before you hire them. If you are already working with an attorney, we urge you to ask them your questions. After all, they will be familiar with your situation and the laws in your state.
We hope that you find Solvable helpful in your efforts to get a fresh start.
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Loans in default generally cannot be consolidated until completion of a repayment trial plan so tell your lender if you are in default and determine relevant options (be wary of those asking for upfront fees as well)
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