Tax Resolution Services Memphis, TN

No one likes it when the Internal Revenue Service knocks on their door. If you have unpaid tax debt, the IRS may be threatening you with hefty penalties, wage garnishments, bank levies, and liens on your assets.

Facing the ire of the IRS and potential financial hardship can be a stressful and even overwhelming experience. Even the prospect of an audit is daunting for many taxpayers.

But tax-related trouble often happens to good people who simply need legal guidance to escape their predicament. Memphis tax resolution services provide just that. A tax accountant can help you understand your full legal options and fight to defend your rights against the IRS.

If you’re preparing for an audit, defending your wages, bank accounts, or assets from seizure, seeking to reduce back tax penalties, considering bankruptcy, or in need of a tax preparer to help accurately file your tax returns, an experienced Memphis tax attorney can work with you and the IRS to achieve the most favorable possible outcome. The following are some of the most common tax relief services an attorney provides.

Arrange a Suitable IRS Payment Plan

Tax attorneys can often negotiate with the IRS to arrange a payment installment plan for their clients. IRS payment plans may allow you to get back into good standing with the IRS while avoiding additional penalties and interest and also preventing your tax debt from growing.

IRS installment agreements may be short-term or long-term. A short-term installment agreement allows the taxpayer to pay their back taxes within 120 days. A long-term payment plan may allow you to pay the total balance of the tax debt you owe over a period of several years: six years at most.

Four Types of Installment Plans

IRS payment plans come in four forms. Depending on your financial situation, you may opt for a guaranteed, streamlined, regular, or partial pay installment agreement.

Payment plans are an excellent way out of tax problems for many taxpayers struggling with the amount they owe, as long as the schedule of payments is well-suited to the taxpayer’s income and budget. A tax lawyer can negotiate for a payment structure that won’t put you in undue financial hardship over the coming months and years.

Minimize Your Tax Debt With an Offer in Compromise

The IRS provides an option for some taxpayers to settle their tax debt for less than the full amount of tax liability owed. These arrangements, called Offers in Compromise, are designed to help any individual taxpayer or business that has no ability to repay their full tax liability owed, believes they have been incorrectly assessed, or has had their ability to pay taxes or file returns disrupted by extenuating circumstances such as a natural disaster.

Challenges When Applying for Offers in Compromise

Offers in Compromise aren’t for everyone. There are strict eligibility requirements, and, when considering applicants, the IRS takes into account various factors including your income, expenses, assets, and ability to pay. The process of applying for an Offer in Compromise is also lengthy and usually requires the help of a skillful tax lawyer.

Find Out if You Qualify First

Despite these obstacles, Offers in Compromise can sometimes rescue taxpayers from crushing IRS tax debt and the threat of wage garnishment, levies, and asset seizure. If you’re experiencing both IRS tax issues and personal financial difficulties, it’s certainly worth consulting with an attorney to find out if you’re a suitable candidate.

Pay a Little Less With Penalty Abatement

Another form of IRS tax relief is penalty abatement, which may allow you to waive one or more of your penalties and thereby slightly improve your overall tax situation. A penalty for failure to pay or for unfiled tax returns might be excused if you’re eligible.

First-Time Penalty Abatement

A first-time penalty waiver is one option for taxpayers who have already paid their taxes in full, or at least set up a payment arrangement to do so and have also filed all required tax returns and extensions. If granted, the first-time waiver dismisses the oldest of the penalties you owe, provided that you had no other penalty in the three years prior to that one.

Reasonable Cause Penalty Abatement

You might also be eligible for a reasonable cause penalty waiver. This type of waiver may be granted to taxpayers who acted with prudence and good faith when handling their taxes but were prevented from filing or paying because of something outside of their control.

Possible reasonable causes include death, serious illness, or unavoidable absence. Natural disasters may also be a viable cause, as are flood, fire, or casualty. Undue hardship may also be an accepted reason. If you were unable to retrieve necessary records in time or you made a mistake with your IRS tax return and actively tried to correct it, you might also be eligible for a penalty waiver.

Penalty abatement is a viable step in IRS tax relief for many individual taxpayers. Your attorney can evaluate your tax issue, determine if you’re likely to qualify, and submit the application on your behalf.

Gain Tax Relief With Currently Not Collectible Status

Any taxpayer or business that’s struggling to meet both their IRS back taxes and living expenses may need some breathing space to find their financial feet. Your tax attorney may be able to attain Currently Not Collectible (CNC) status for you, which would stop the IRS from trying to collect your tax debt for a period of time: typically one year.

While you have CNC status, interest and additional tax penalties will continue to accrue on your tax debt, but no wage garnishments, bank balance liens, or other collection actions will be taken against you. This tax relief option can be a godsend for many struggling taxpayers, giving them time to improve their finances and keep possession of their homes, businesses, and other assets.

Proof of Potential Financial Hardship Is Required

As with all IRS tax relief options, not every taxpayer or business with a tax problem will be eligible for CNC status. The taxpayer needs to prove that they would face financial catastrophe if forced to pay their back taxes at this time.

The IRS will conduct an in-depth examination of your financial situation before granting this tax relief. If they don’t believe that paying your tax debt would put you into immediate undue financial hardship, they won’t grant CNC status. Once again, your attorney can help evaluate your eligibility, apply on your behalf, and prepare you for the examination.

Avoid Liability for Tax Debt With Innocent Spouse Relief

If you’ve filed a joint tax return with your spouse but you were unaware of a tax liability they already owe or an understatement they made on the tax return, you may be eligible for Innocent Spouse Relief. If granted, you would avoid paying taxes on money earned by your spouse or ex-spouse.

You’d also avoid penalties, back taxes, and collection actions against your spouse or ex-spouse who is determined solely responsible for the money earned and any understatements on their tax returns. When applying for this tax resolution option, you’ll need to prove that you weren’t aware of any understatement on your joint tax returns and that you haven’t benefited from any understatement, all of which legal tax professionals can help you with.

Appeal a Tax Lien or Levy

If you owe taxes to the IRS, they can legally seize your hard-earned money directly from your bank account with a bank levy. They can also seize your social security benefits and other financial assets.

Wage garnishment is another action the IRS frequently uses to recover tax debts. Backed by federal law, the IRS can force your employer to send a portion of your paycheck directly to the IRS each month. This reduction in pay can be devastating to any taxpayer who’s currently living paycheck to paycheck.

Internal Revenue Service Liens on Property

With a federal tax lien, the IRS can place tax liens on your home and other assets, allowing them to seize your property if your tax issues aren’t promptly resolved. The imposition of the tax lien itself can harm your creditworthiness and hinder any house purchases you’re currently undergoing; unless you successfully appeal, an IRS lien can be enormously disruptive to an individual’s life.

You Have a Limited Time To Appeal a Lien or Levy

Before any lien or levy is enacted, you’ll receive a notice from the IRS that grants you a limited amount of time in which to appeal and prevent the IRS from seizing your money and assets. From the date you receive the notice, you have 21 days to request a release of levy and 30 days to appeal a lien.

If you receive such a notice, given the urgency of this situation, it’s best to immediately hire a tax resolution attorney with a deep understanding of federal tax law. Your attorney may be able to have the levy or lien dismissed by negotiating a payment plan for the money owed, CNC status, or another tax resolution strategy.

How a Memphis Tax Attorney Can Help

With in-depth knowledge of local, state, and federal tax laws, attorneys can provide their clients with timely tax help and advice for all matters relating to the IRS. If you’re experiencing any tax debt trouble including unfiled tax returns, penalties, levies, or liens, an experienced attorney who’s in good standing with the Better Business Bureau can help alleviate those problems by finding the most favorable solution allowable by the IRS and federal tax law.

An IRS Tax Preparer Can Help With Your Tax Returns

Working with certified public accountants, Memphis tax attorneys can also provide tax preparer services, helping you prepare and file your tax returns more effectively to avoid IRS problems in the first place. After all, when it comes to personal or business taxes and potential tax debt, an ounce of prevention is worth a pound of cure. If you’re facing tax debt or you need any IRS-related assistance, contact Damiens Law at (601) 957-9672 for a free consultation. For over a decade, our experienced tax lawyers have been helping our clients qualify for IRS relief programs, resolve their tax issues, and put their financial difficulties behind them for a fresh start in life.