The tax professionals at JAG have over 50 years of combined tax mediation experience to get our clients results. Those who are searching for help with back-taxes and are hoping to procure a back-tax settlement choose us to achieve the best possible outcome. Currently, the IRS and State agencies recognize four different kinds of tax settlement agreements that can provide and, in some cases, eliminate tax debt. Contrary to popular belief, clients do not have to be in financial hardship to qualify for this IRS tax relief help. In fact, of the four main resolution programs used, only two are actually based in clients not having an ability to pay. The following is a list of the four main tax relief help programs that we perform here at JAG.
The Offer in Compromise is a financial hardship program which can feel like a pot of gold at the end of the rainbow with regards to State and IRS back tax settlements and income tax settlements. With an Offer in Compromise, and for taxpayers who qualify, the IRS will agree take a percentage of what a taxpayer owes as payoff to satisfy a tax debt. The problem is, qualifying for this program is rare and unfortunately many tax settlement companies will tell clients that they can achieve this outcome. However, if and when a client’s financial situation does qualify, the client will be forced to pay the reduced amount within a time frame dictated by the IRS. Also, the taxpayer may not add on to the debt and must file on time for the next five years following acceptance into the program.
Although “Back End Settlement” is not an official IRS name for it, this program is a non-financial hardship program that is one of the most misunderstood tax settlements with the IRS or State. The reason behind the confusion is because many tax settlement centers don’t completely understand how the IRS statute of collections works. The IRS has ten years to collect on the date from which that liability was assessed. There are many things that can reset the statute that taxpayers, and even tax settlement attorneys, don’t completely comprehend. By playing the statue against itself, it is possible to get the tax payer on a small payment plan for the limited life of the debt, resulting in non-payment of some or the majority of the tax liability. Make no mistake, when done correctly, this program can be a very effective income tax settlement program.
Typically reserved for taxpayers who are on a fixed income like the elderly or the disabled, this financial hardship program can essentially eliminate a tax debt. For those taxpayers who qualify, a client must substantiate that they do not have any extra income beyond basic living expenses to pay back a tax debt. Ideally, like previously stated, the taxpayer shows no ability to make any income beyond what they are currently making. If the taxpayer continues to file on time and pay what they owe if they owe, the debt will eventually expire due to the statute of limitations on collections.
One of the most terrifying and debilitating things a taxpayer can receive is a threatening IRS or State phone call or letter. This process is designed to get taxpayers to throw themselves on the mercy of the IRS or State. Many taxpayers will make the mistake of working directly with the IRS or State, thinking that they will be treated fairly. Or worse, some taxpayers will ignore these calls to action and end up receiving a State or IRS garnishment of bank levy. Once retained, the tax attorneys, CPAs and EAs at JAG, will quickly prevent and prohibit the IRS or State agencies from contacting our clients. We will put our clients’ minds at ease while we diligently work towards a swift resolution of their tax case.
Penalty abatement is a non-financial hardship program which provides taxpayers with a reduction of the penalties and interest on those penalties which have accrued on the taxpayer’s debt overtime. It is the most commonly used IRS tax settlement program and the program that seems to be the most misunderstood by most IRS tax settlement companies. In the case of this income tax settlement program, the taxpayer must substantiate some sort of dramatic life event which caused them to find behind. The IRS understands that there are significant things that may happen in a taxpayer’s life which may cause them to fall behind or worse, stop filing all together. Because of this, the IRS is willing to abate the penalties that have accrued on the debt.
JAG prides itself on being a full-service tax resolution/tax mediation firm. Unlike some companies that offer watered down tax settlement services, JAG Tax Management employs a full-time staff of tax preparers and CPAs to ensure a quick and accurate filing of delinquent tax returns. Because the IRS or State agencies are unwilling to stop garnishments or stop levies without a client being in compliance first, it’s crucial to be able to expedite complete and accurate past tax returns as quickly as possible. Even if the client does not have a State or IRS garnishment of wages or a bank levy, the taxpayer’s submission will not be considered until they are in full compliance. We file thousands of tax returns a year and have never had a return audited. In short, we specialize in accurate and aggressive delinquent tax returns for small business, self-employed, and w2 employees.
Because JAG prides itself on being a small business specialist, one of the major types of tax issues that we handle for our clients are those of businesses experiencing issues with payroll taxes. This IRS only issue is caused when employers are unable to pay the taxes withheld from their employees because, frankly, they need the extra income to keep the business afloat and keep the doors open. This is the dilemma that most small businesses are facing when they come to us. The IRS shows little to no leniency when trying to repay or make accommodations to try to pay back debt from payroll. It would seem that the IRS would rather have businesses close their doors then try to keep them open to earn income to pay off the debt. Because the IRS is so aggressive with payroll debt, they often will quickly assign an IRS revenue officer who has the ability to shut down the business. As a taxpayer and a business owner, you have rights. Here at JAG, we will keep your doors open and keep the IRS off your back.
Often confused with an audit, the IRS will also do a tax “Reassessment” of a taxpayer’s previous year’s tax return. A reassessment happens when there is a discrepancy between what income reported to a taxpayer’s social security number or EIN, and what income was reported on the taxpayer’s tax return. This results in the taxpayer receiving a letter stating they owe a certain amount for a certain tax year. In most cases, the taxpayer has no idea how it happened and may have even received a refund for the tax year in question. In many cases, the taxpayer forgot to report additional income resulting from various activities like liquidating a retirement account, gambling winnings, debt forgiveness, and improperly filing a tax return on a sold property. Coincidently, there has also been a rise in identity theft where a taxpayer’s social security number has extra income reported to it in which taxes were never collected.
Because JAG prides itself on being a small business specialist, one of the major types of tax issues that we handle for our clients are those businesses experiencing issues with State sales and excise tax issues. These issues are caused when a small business is unable to pay the taxes they collected from their customers or clients for a tangible good they sold or service they performed. The State shows little to no leniency when trying to try pay back the debt. Because the State’s collection power is so strong and because they have more resources and a smaller geographical area, they can be brutally aggressive. They have even been known to chain up business doors or show up with local authorities to seize assets to sell at public auction. As a taxpayer and business owner, you have rights. Our team at JAG will keep your doors open and keep the State off your back.
Has the state or IRS recently garnished your wages at work or levied your bank account? This action is one of the IRS and State’s most aggressive collection efforts against taxpayers. The more time a taxpayer waits to do something to stop a garnishment or to get tax levy help, the worse it gets. If you are currently being garnished or levied, and are wondering how to stop a garnishment or how to stop a tax levy, call us today. We will quickly throw resources at your case to ensure the quick release of your garnishment or levy, and quickly get you back on your feet. But time is of the essence, so call us today.
One of the most aggressive actions of collections that either the IRS or State collection agencies can take is assigning a Revenue Officer to collect against a taxpayer. Normally reserved for taxpayers with larger liabilities, as of late both the IRS and State collection agencies have been assigning Revenue Officers if they get the slightest hint that a debtor is resisting their collection efforts. Often, these officers will act on their own accord and not by the collection procedures obligated by the IRS and State. In many cases, Revenue Officers have been known to dodge calls in order to make taxpayers miss deadlines so they can take collection action like initiating a pay garnishment or bank levy. Their actions are so dubious; they have been known to do things like showing up at a taxpayer’s doorstep or even a taxpayer’s neighbor’s door step. If you currently have been assigned a Revenue Officer by either the IRS or the State, do not try to handle them on your own.
One of the most dubious things the IRS and State agencies can do is to make taxpayers believe that they will put them on an affordable payment plan. Often times, they will agree to a certain amount, but then ask taxpayers to provide financials so the IRS can review them. They assure that the payment amount will stay the same as long as the provided financials line up. Problem is, the financials never do. If the taxpayer knew that the IRS doesn’t allow expenses beyond what the national standard of expenses, they would be reluctant to provide this info. The goal of the IRS is to get their hands on your financials. That way, when they come back and tell the taxpayer they do indeed have the ability to pay more, there is no argument because they have full financials that tell a different story.
We argue expenses and make the IRS and State accept expenses they wouldn’t normally, and our clients walk away in a much better position than they would have on their own.