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8 Ways to Get Ready for Tax Season and Avoid a Back Tax Problem

November 30, 2021

The holidays are here. Not to be a Grinch but, right around the corner is a less fondly anticipated time of year. Before you know it, you will be taking down the Christmas tree, pulling down the holiday lights and getting ready for the tax season to come.

Tax season is decidedly less fun than holiday season, but the two times of year do have one thing in common. Just like the holidays, tax season requires lots of preparation and planning, and if you want to be ready, you need to start early.

Why am I writing this article? It’s not to spoil your holiday cheer, it’s because we’ve seen what it’s like when you’re not prepared. We help people who fall behind on their taxes and owe the IRS tens of thousands of dollars in back taxes, and it’s often because they simply failed to prepare and they procrastinate on their taxes.

If you do get in trouble with the IRS and they claim you owe $10,000 or more, reach out to our tax resolution firm and we’ll schedule a free, no-obligation confidential consultation to explain your options in full to permanently resolve your tax problem Get help from Ron Friedman, CPA,

So if you don’t want to end up owing the IRS a ton of money, Here are 10 ways to get ready for tax season and reduce your stress level as this annual ritual approaches.

#1 Organize your records.

Now is the time to drag out last year’s tax return, pull out your most recent pay stub and get organized before the season starts.

#2 Settle any back taxes you might owe.

If you have years of unfiled returns or have a tax issue for anything besides the current year, you should get this handled now, before the upcoming tax season. When April 15th comes around, your tax professional is likely swamped with returns and they’ll pay less attention to your back tax debt. We recommend reaching out to a specialized tax relief firm like ours who handles complicated tax debt cases all year round.

#3 Defer bonuses and incentive pay.

If you’re going to owe taxes, it might make sense to defer getting paid so you can lower your taxable income. If you can, you might want to defer any bonuses and incentive payments. You can also defer payments from retirement accounts and IRAs to save on current-year taxes.

#4 Look for additional deductions.

Now is the time to make those last-minute donations to charity, so start writing those checks and gathering up those household goods. Be sure to get a receipt and save your cancelled checks so you can substantiate your charitable giving if a question should arise later.

#5 Expand your education.

Not only can taking a class improve your business or career prospects and help you get ahead, but that additional education could also lower your tax bill. You might qualify for a generous tax credit or take a good tax deduction for investing in your future.

#6 Up your retirement savings.

The end of the year is the perfect time to increase your 401(k) contributions and make your annual IRA investment. Maxing out your 401(k) and IRA contributions is one of the best ways to reduce your tax bill while saving for the future.

#7 Sell your losers and let your winners run.

if you have substantial capital gains in your stock portfolio or crypto portfolio, selling your losers could lower your tax bill. You can use those losses to offset your capital gains and save money on your taxes.

#8 Estimate your income for tax planning.

You will not know the exact amount of income you received until all your documents are in, but you can estimate your compensation and start doing some advance tax planning. This can be key in preventing back tax debt since you wont be blindsided by a large tax bill come April 15th.

Tax season will be here before you know it, and now is the time to get ready. You do not have to wait until April to start your tax planning, and the sooner you get started, the sooner you can put this unpleasant task behind you.

Need Tax Relief?

If you want an expert tax resolution specialist who knows how to navigate the IRS maze, reach out to our firm and we’ll schedule a no-obligation confidential consultation to explain your options to permanently resolve your tax problem Get help from Ron Friedman, CPA.

Tips for Finding a Qualified Tax Resolution Firm

October 22, 2021

Given how high the stakes are, it is surprising how little thought many people give to their taxes. All too often, individuals simply walk into a neighborhood storefront, hand over their most personal information and trust the person on the other side of the desk to do the right thing and prepare their taxes properly.

In many cases that trust is well placed, and the individual preparing the taxes is indeed the honest and trustworthy professional they claim to be. In other cases, however, the trust is misplaced, and the tax preparer will end up making mistakes that could cost the individual a great deal. If an audit is triggered by a deliberate misrepresentation or unintentional mistake, you will still be on the hook for any additional taxes, interest and penalties.

If you’re in tax trouble because you trusted the wrong tax preparer, then you will need a qualified tax resolution firm to help you resolve your tax problem. However, you don’t want to repeat the same mistake twice! So, it is important to do your homework and know what to look for in a tax resolution firm. Here are 4 quick tips to help you find a qualified tax resolution firm.

#1 Read Their Reviews Online

By reading online reviews you can quickly see if the tax resolution firm is reputable and stands by their clients. A lot of the big national firms will have terrible reviews but they market themselves heavily, so consumers don’t think twice about their reputation.

If you owe back taxes, waiting can cost you a lot of money and if the tax resolution firm disappears on you or doesn’t return your call, that wasted time could cost you dearly. This can easily be snuffed out by seeing if they have good online reviews about their services.

#2 Make Sure the Tax Resolution Firm Has Experience and A Proven Track Record

Negotiating with the IRS to settle your tax debt is a specialized skill that not all tax attorneys or tax professionals have. It’s important to ask about their recent case settlements and success stories. A true tax resolution professional will have proof they’ve done this before and successfully helped resolve back tax problems.

#3 What Does Their Communication Look Like Once You Sign On?

A professional and experienced firm will have systems in place to make sure you’re updated regularly on your tax resolution case. The IRS moves slow and there will likely be big gaps in time in between updates from the IRS. That doesn’t mean the tax relief firm should also have gaps in communication.

Ask how long they think it’ll take to resolve your tax problem, and how you’ll be updated even if they don’t have any news from the IRS.

#4 Avoid Big National Firms With Salespeople Who Promise The Moon But Don’t Deliver

You’ve heard their ads on the radio or TV. If you call a big national firm, you’ll likely get a salesperson who knows very little about taxes or how to settle your tax debt.

Not every taxpayer qualifies for all the IRS tax debt settlement programs. However, these salespeople will promise you the moon but will fail to deliver because they didn’t take the time to understand your specific situation and they’re not actually licensed tax resolution professionals.

Make sure to ask who will be responsible for your case and try to speak with them directly before signing up. A true tax resolution expert will be happy to speak with you to make sure they can understand your case and offer you the right solution.

Need Tax Relief?

4 Common Tax Return Mistakes That Could Get You in Trouble with the IRS

As tax filing season unfolds, many taxpayers are taking the bull by the horns and doing their own taxes. Though it may seem like good news for the individual taxpayer, it’s important to watch out for common tax filing mistakes. Tax preparation software makes some errors like addition and subtraction blunders less likely, but even the best software cannot eliminate all potential problems and human error.

If you are getting ready to file your tax return, be sure to take a second (or third) look before you hit send. Keeping a close eye out for these common tax filing mistakes is the best way to ensure the IRS does not come knocking at your door.

Note: If you do get in trouble with the IRS and they claim you owe $10,o00 or more, reach out to our tax resolution firm and we’ll schedule a free, no-obligation confidential consultation to explain your options in full to permanently resolve your tax problem Get help from Ron Friedman, CPA.

That said, lets jump into the 4 common tax return mistakes that could land you in tax trouble.

#1. Transposed Numbers

If the 1099 you receive shows $6,300 in income and you inadvertently enter $3,600 instead, the IRS may see this as a tax dodge instead of an innocent mistake. At best, transposing numbers will slow down your refund and raise a red flag with the tax agency. At worst, it could trigger an audit or further examination of your entire return.

IRS computers are very good at comparing the figures taxpayers report to the ones they receive independently from banks, brokerage firms and other agencies. Be sure to double-check and verify every number you enter and make sure it is right. Your tax software can tell you if your numbers do not add up, but they cannot catch transposed figures.

#2. Misspelled Names

It is easy to misspell a name or transpose a Social Security number when entering dependent information, but doing so could cause real problems with your return. Be sure to double-check the names, ages and Social Security numbers of all your children before sending your return to the IRS.

Do not assume that all of that information will be transferred from a prior year return.

#3. Missing Social Security Numbers

It is easy to forget this vital piece of information, and doing so could delay your return and cause long-lasting problems. You may assume that your tax prep software will automatically enter your Social Security number, but that does not always happen.

Be sure to give your Social Security number (and that of your spouse) one last look before filing your return. That last minute check could save you a world of trouble later on.

#4. Not Reporting All Your Income or Taking Too Many Deductions

The IRS will likely get notified of income you received throughout the year, and it doesn’t just include your W2 wages. It’s important to keep track of all your income and report it to the IRS correctly to avoid any problems.

It can also be tempting to click a few extra boxes and input a few made up numbers as deductions to bring your tax liability down. DO NOT DO THIS. Just because the software lets you do this, doesn’t mean you should.

It’s not the software’s job to tell you whether or not you should be taking that extra deduction or write off, it’s the taxpayer’s job to be honest and file their tax returns correctly.

NEED TAX RELIEF?

If you made a mistake on your tax return and end up on the receiving end of an IRS notice, or if you have years of unfiled tax returns, reach out to our office. We’ll schedule a no-obligation confidential consultation to explain your options to permanently resolve your tax problem Get help from Ron Friedman, CPA.

Key Things to Look for in a Tax Relief Firm

August 9, 2021

No one wants to be on the bad side of the IRS, yet that is where millions of taxpayers find themselves each and every year. As enforcement efforts ramp up at the IRS, the number of letters and communications landing in mailboxes is continuing to increase and one of them could land in your mailbox.

If you do receive a notice from the IRS, it is important to act fast, especially if you cannot afford to pay what the IRS says you owe. You may be tempted to do nothing or ignore the situation, but every day you wait will just make an already bad situation that much worse.

The good news is you may not have to pay what the IRS says you owe! There are a number of programs designed to give taxpayers relief, in many cases allowing them to settle their tax debts for much less. But before you can enjoy that financial relief, you need to find the right partner, and here are some key things to look for.

The Right Tax Relief and IRS Negotiation Experience.

When you hire a tax relief firm, you will be hiring a team of experts, and it is important that the person who works on your case will be up to the task. It is important to look for specific areas of expertise, including former IRS agents, attorneys and others who can help you negotiate with the IRS on your behalf.

The best tax relief agencies are not necessarily huge firms; some of the best are small operators with extensive experience. But no matter what the size of the firm, the tax resolution expertise of the person working on your case is what matters the most.

Compassion and Understanding

Dealing with the IRS is not just a financial problem; it is an emotional one as well. Getting a letter from the IRS is bound to be an upsetting and unsettling experience, and working with a compassionate and caring tax relief firm can help a lot.

You should not, of course, sacrifice expertise and capability for compassion, but there is no reason you cannot have the best of both worlds. Look for someone who cares about you and your situation as you interview tax relief firms and choose the one you feel best about working with.

Recent IRS Negotiation Success Stories

The IRS is a huge agency, and the tax code is endlessly complex. That enormous complexity and ever-growing structure means that past experience may no longer be relevant, so look for recent experience with the IRS in the form of testimonials and case studies.

Chances are if they have good “wins” under their belt, they know what they’re doing and they can get you a favorable outcome. Working with these experts can give you peace of mind and make it easier for you to resolve your tax problem.

Getting a letter from the IRS can be a scary experience, but it does not have to be the end of the world. You do not have to suffer financial devastation or go bankrupt to settle the debt you owe. Now that you know how to find a great tax relief partner, you no longer have to live in fear of your next trip to the mailbox.

Reach out to our tax resolution firm and we’ll schedule a free, no-obligation confidential consultation to explain your options in full to permanently resolve your tax problem. Get help from Ron Friedman, CPA.

Lucky Day at the Casino? Don’t Forget About the IRS

June 2, 2021

Whether you gamble all the time or only once in a blue moon, you are filled with hope and excitement every time you walk through those casino doors.

If you have been gambling for even a little while, you already know that Lady Luck can be a fickle partner. Sometimes the gods of the casino smile upon you, and other times they turn their back. So, when you finally hit the jackpot, you are overjoyed and brimming with excitement…

At least until you consider the tax consequences of your good fortune.

Every time you walk through the doors of the casino, Uncle Sam is peering over your shoulder, and the IRS will be waiting with its hand out when good fortune finally smiles on you.

As you celebrate your big win, do not forget about your taxes; if you do, the IRS is sure to come calling. If you have any tax issues, or find yourself owing a large amount in back taxes, reach out to our tax resolution firm and we’ll help you navigate any obstacles. Get help from Ron Friedman, CPA.

Ask About a W2-G

One of the first things you need to know about winning big at the casino is that the IRS will receive notice of how much you won. If you try to fudge the numbers or not report the win at all, chances are you will soon be on the wrong end of a tax bill.

It is important to report all of your gambling winnings, even smaller jackpots that may not warrant a W2-G, the form on which those monies are recorded. And if you do win a substantial jackpot, ask the casino workers about how and when the tax forms will be issued.

Understand Withholding

When you have a lucky day at the casino, it is easy to blow your winnings, especially if you have never been so lucky before. But before you spend your last dollar, you might want to keep some in reserve for when tax time rolls around. If you fail to keep that money available, you could be in for an unpleasant surprise, and a big tax bill, when you file.

Casinos know that their customers may have trouble paying taxes on their winnings, and that is why many of them will automatically withhold a portion of the jackpot. If you do win a substantial jackpot, make sure you understand whether, and how, this withholding will take place.

If you are concerned about having the money to pay the taxes due, you may be able to ask the casino to do the withholding for you. Not all casinos will be willing to do this, but it never hurts to ask.

Track Your Losses

The fact that you have to pay taxes on your gambling winnings may seem unfair and arbitrary, but the IRS is not entirely heartless. You may be able to write off some of the money you lost in pursuit of your latest jackpot, but only if you can back up those numbers with hard data.

Tracking your losses is never a fun thing to do, especially if you are a regular casino visitor. Even so, it is important to keep track, and many casinos will do the work for you.

If you carry a casino loyalty card, you may be able to log on or request a report showing how much you spent, and how much you won, while your card was in use. This is not a perfect solution, but it can be a good first step if you plan to write off your losses in hopes of reducing your final tax bill.

Having a lucky day at the casino feels good no matter who you are, as does leaving the casino with a stack of cash and a big jackpot to your name.

But the next time Lady Luck smiles on you, make sure you leave a little for Uncle Sam.

If you find yourself behind on your taxes and owe more than $10,000, contact our firm. We’ll schedule a no-obligation confidential consultation to explain your options to potentially settle your tax debt for less than what you owe. Get help from Ron Friedman, CPA.

How to Amend a Tax Return for a Prior Year

February 15, 2021

Tax returns can often be filed with incomplete or incorrect information, leading you to more tax trouble than you bargained for. If you filed early, you might have overlooked income from a temporary job or a side gig, only to get a 1099 or late W2 for the income earned.

Other filers may eventually realize that they were entitled to an extra deduction or exemption. The Internal Revenue Service routinely processes a significant number of amended returns each year and provides a specific form for changing the status of an earlier tax return.

Individual income tax returns filed with the IRS can be amended up to three years after the due date of the original return by filing IRS Form 1040X. However, we strongly suggest consulting a tax resolution professional to help with your amended return. They can often file multiple years of unfiled tax returns, help you settle for a fraction of what you owe, and at the very least save you a headache.

Note: If you know you’ll have outstanding tax debt and owe more than $10k to the IRS or state but can’t pay in full, contact our firm today. I help people find tax relief and sometimes settle their tax debt for a fraction of what’s owed Feel free to find me on the web at: Ron Friedman CPA Tax Relief Pro.

How Amended Tax Returns Work

Returns containing simple math mistakes are usually corrected automatically and do not require an amended return. Filing an amended return should be considered after the filer realizes the need for a change in filing status, income, allowable deductions or credits. The statute of limitations generally allows three years for each filer to claim any tax benefit not included on a prior return.

An increase in reported income is likely to result in additional tax due, but an additional deduction or allowable tax credit could result in a refund.

Unreported income is a common oversight and it’s better to report your income than it is for the IRS to come after you and add penalties and interest to your tax debt.

Prior to tax year 2019, Form 1040X is not eligible for electronic filing and must be mailed in, this is also why we recommend hiring a professional to do this for you. A separate Form 1040X is necessary for each year being amended, and each must be mailed in its own envelope to the address provided in the instructions.

The amended return essentially adds the corrections to the original return. There is a block of space on the form to explain all changes. The explanation for each line change should include the line number followed by a clear reason for the change. Lines that entail no change need no explanation. A copy of the original return itself should not be attached, but any added IRS forms must be included to support the changes. Any other supporting documents necessary to substantiate the amendment will also need to be attached.

It can take several weeks for the IRS to process an amended return. An amendment to the federal return might also require a change to the state tax return of the filer, especially if an increase in income is to be reported.

OWE BACK TAXES?

If you’re going to owe money to the IRS after filing your return, it’s important to note that only experienced firms like ours are able to handle tax debt cases since negotiating with the IRS requires specialized skills that often fall outside of the scope of most conventional accounting, tax, and tax law firms.

My firm specializes in tax problem resolution. As a CPA, and a Federally Authorized Tax Practitioner, I can represent you before the IRS. I serve clients virtually so don’t hesitate to reach out. If you want an expert tax resolution specialist who knows how to navigate the IRS maze, reach out to my firm and we’ll schedule a no-obligation confidential case consultation to explain your options to permanently resolve your tax problem. Feel free to find us on the web at: Ron Friedman CPA Tax Relief Pro.

Considering Bankruptcy to Get Rid Of Your Back Taxes? 3 Alternatives to Explore Before You File

August 7, 2020

If you are drowning in debt and working harder and harder to make ends meet, you may think a bankruptcy filing is the only way out, but that is not necessarily the case. Filing for bankruptcy is one solution, but it is a drastic step that should only be taken as a last resort.

This is especially true if you owe back taxes to the IRS or state. Depending on what type of taxes you owe, you might not be able to wipe out your back taxes in bankruptcy proceedings.

It’s important to weigh all your options and get a clear picture of your financial situation, so in this article, we share with you 3 smart steps to take before declaring bankruptcy.

Depending on how much you owe, who your creditors are, and how the rest of your financial life looks, you may be able to dig yourself out of the hole and take back control without having to declare bankruptcy. Here are three smart alternatives to consider before calling a bankruptcy attorney.

3 Alternatives to Explore Before You File

Contact A Tax Relief Firm

Most bankruptcy attorneys aren’t familiar with the complex tax laws so they won’t accurately be able to assess your tax situation.

A tax relief firm like ours can help you assess your back tax situation and often help you settle your back tax debt with the IRS. If you owe a substantial amount of back taxes, this may be a good way to reduce your overall debt burden. This can also be a good first step to getting back on track with your finances.

Request a Lower Interest Rate On Other Debts

When you are paying 18% or more in interest, it can be hard to keep up with the charges, let alone make any headway on the outstanding balance. Credit card interest rates are among the highest around, and those outrageous rates have trapped many consumers in a spiral of ever increasing debt.

How different would your finances look if your interest rate was cut in half? Would you finally be able to get ahead of the interest charges and start paying down your balance? If so, it is time to get your credit card issuer on the line.

Even if you do not think your credit card issuer will be receptive, it never hurts to ask. And when the credit card company finds out that you are thinking about filing bankruptcy, they may be more willing to negotiate than you think.

For tax debt, the IRS can sometimes remove penalties and interest from your tax debt, so it’s important to reach out to our firm to see what your options may be.

Refinance Your Debt

Even if your credit card issuers and lenders are not willing to budge on the interest rates, you could still save money and avoid bankruptcy. Refinancing your existing debt through a home equity line of credit, a personal loan or other means could lower your interest rate substantially and slash your monthly payments.

If you do decide on this strategy, it pays to shop around. The more you can lower your interest rate, the more money you can save – and the faster you will be able to pay off your debts.

But it’s incredibly hard to refinance your debts if you have an IRS tax lien or wage levy. Our firm can get these released and help you get on financial track.

A bankruptcy filing can provide a fresh start for those in dire financial circumstances, helping them recover and rebuild their shattered monetary lives.

Even so, bankruptcy is not the only way out, and it is important for those considering this solution to research the alternatives first. The three bankruptcy alternatives listed above can also give you the fresh start you need, without the stigma or long-lasting impacts of a bankruptcy filing.

IMPORTANT: We highly recommend readers to reach out to our firm first. Our clients never have to talk to the IRS, and tax resolution through our firm can save you money and time in the long run. You might also be eligible for other relief programs or get your penalties and interest forgiven. Reach out to our firm today for a consultation.

Why You Shouldn’t Put Off Filing Your Taxes

June 21, 2020

With the filing deadline moving from the traditional date of April 15th to July 15th because of the coronavirus pandemic, it can be tempting to put off filing your taxes for as long as possible. Most taxpayers dread the tedious task of compiling their financial records, tax documents and filing their taxes. Unfortunately, the longer … Read More…

With the filing deadline moving from the traditional date of April 15th to July 15th because of the coronavirus pandemic, it can be tempting to put off filing your taxes for as long as possible.

Most taxpayers dread the tedious task of compiling their financial records, tax documents and filing their taxes. Unfortunately, the longer you procrastinate doing your taxes, the greater the chances that something will go wrong.

And if you owe money to the IRS, the more penalties and interest you’ll have to pay. Often, it’s a better idea to file your taxes sooner rather than later.

Here’s why.

TAX IDENTITY THEFT

Tax Theft Tax return fraud is one of the most common and fastest growing forms of identity theft. Basically, an identity thief steals your employment information and Social Security number – and files a fraudulent tax return on your behalf. Then, they steal your refund, or worse, put you in a hole owing back taxes you might not actually owe.

Unfortunately, once the IRS sends your tax refund out, it’s nearly impossible to get the money back without knowing the law and regulations. One way to avoid falling victim to tax fraud is to file your taxes as early as possible. That way, you reduce the chances of tax identity theft by filing before the identity thief gets a chance to file a fraudulent return.

FIND AND CORRECT MISTAKES SOONER

Filing your tax return earlier makes it easier to fix any mistakes on your tax documents. For example, your employer might record the wrong earnings on your W-2. If you discover a mistake on your tax documents right before the filing deadline, you aren’t going to have enough time to get the mistake resolved. Your tax return will end up getting delayed and you will have to go through the process of requesting an extension from the IRS, tacking on penalties and interests, that are compounded daily, to your tax liability.

YOU MIGHT OWE THE IRS MONEY

Unfortunately, many taxpayers underestimate their tax liability during the year. That means they underpay and end up owing the government money. The IRS charges taxpayers a penalty for underpaying their taxes as well as interest on the amount of taxes that they owe.

Therefore, the sooner you file and pay any remaining taxes, the smaller your financial penalty and interest will be. If you can’t pay up front, you might have tax relief options.

GET IT OVER WITH

There’s no better tax relief than just finally taking care of your taxes. If you are one of the many taxpayers that get stressed over taxes, you will actually feel better if you don’t procrastinate filing your tax return.

Just get it over with so it’s not hanging over your head! The peace of mind you get from not knowing where you stand with the IRS is worth it. It’s often not as bad as you think, even if you owe back taxes, having a firm like ours represent you can be worth it in the long run.

Our firm specializes in tax resolution. We serve clients virtually so don’t hesitate to reach out. If you want an expert tax resolution specialist who knows how to navigate the IRS maze, reach out to our firm and we’ll schedule a no-obligation confidential consultation to explain your options to permanently resolve your tax problem. http://taxreliefprowestchester.com/contact/.

How to Handle Your Taxes During an Economic Crisis

Whether it is a global pandemic shutting the economy down for months on end, a stock market crash that leaves formerly giddy investors frightened and nervous or a housing crisis that makes real estate a risky bet, living through tough economic times is never easy. Even so, how you handle yourself and your money during … Read More…

Even so, how you handle yourself and your money during the crisis could make all the difference in the world, and if you do it right, you could emerge stronger, wiser and richer on the other side.

Doing Taxes Handling taxes can be especially difficult during times of crisis. With your income uncertain, it can be hard to predict how much you might owe the IRS or how you can make those payments. And if you are self-employed or a gig worker, this economic uncertainty can be even greater.

So what can you do about your taxes when the economy takes a downturn? Here are some tips to make tax time less taxing when crisis strikes.

Research Filing Extensions and Be Aware of New Deadlines

When economic turmoil strikes, tax filing deadlines may be extended or otherwise relaxed, so do your homework and see how much time you really have. If you are struggling to make your tax payment, you may have some breathing room after all.

In the wake of the COVID-19 pandemic, the IRS extended the normal tax filing deadline from April 15 to July 15, and many state and local governments followed suit. The same may happen in future crises, and it never hurts to find out for sure.

File Promptly if You Are Expecting a Refund

Getting extra time to file can be a welcome relief if you owe money to the IRS, but if the tax agency owes you, it makes sense to file as quickly as possible. The processing of tax refunds is often disrupted during a crisis, with short staffing and different procedures suddenly in place. The sooner you file, the sooner you will have your tax refund money, and that cash could make a world of difference to your financial situation.

How you handle that tax refund is important as well, so think about what you will be doing with the money while you are waiting for it to arrive. If you have the extra cash to do so, contributing to an IRA or other tax shelter could reduce the amount you owe going forward, giving you even more money to work with in the years to come.

File Promptly if You Are NOT Expecting a Refund or Might Owe Back Taxes

The IRS is starting to enforce collections again, but they’re also not oblivious to the financial crisis we’re in. With almost 40 million Americans unemployed we now have the highest unemployment rate since the Great Depression.

The outlook is still uncertain and the IRS knows Americans need to get back to work and buying things to stimulate the economy. It’s tougher to do that with a huge tax bill weighing you down.

So right now, the IRS will likely consider settlements and more favorable terms to taxpayers in trouble, especially if their income drastically decreased due to COVID-19. So it’s important to file your taxes and be current in order to explore tax relief options.

IMPORTANT: We highly recommend readers to reach out to our firm first. Our clients never have to talk to the IRS, and resolving your IRS and state tax problems through our firm can save you money and time in the long run. You might also be eligible for other relief programs or get your penalties and interest forgiven. Reach out to our firm today for a consultation https://taxreliefprowestchester.com/contact/.

Are Your Investments Down? Use It To Reduce The Amount You Owe

It is easy to feel depressed when the stock market is tumbling and reaching new lows every day, but there could be a silver lining to that financial cloud. Engaging in strategic tax loss harvesting now could reduce your tax bill substantially when filing season rolls around. Tax-loss harvesting is when you sell investments at a loss in order to reduce your tax liability.

If you have investments that have not worked out like you hoped, selling them now and locking in the loss can be a great way to offset capital gains and lower your taxable income. This strategy is not the right choice for everyone, but it can be effective in certain circumstances.

Whether the world is in the midst of a global pandemic, the stock market is in free fall or real estate is suddenly on sale, the economic crises that are triggered can make tax time even more difficult.

If you want to stay financially solvent and avoid penalties, interest and other serious consequences, the strategies listed above can help you do it.

Our firm specializes in tax resolution. We also serve clients virtually so don’t hesitate to reach out. If you want an expert tax resolution specialist who knows how to navigate the IRS maze, reach out to our firm and we’ll schedule a no-obligation confidential consultation to explain your options to permanently resolve your tax problem https://taxreliefprowestchester.com/contact/.

IRS Collections Is Starting Back Up. What To Do If You Owe Back Taxes

June 7, 2020

2020 threw a huge wrench into everything and the IRS collections proceedings are no exception. With the tax deadline pushed until July 15th and a lot of the IRS closed under shelter at home orders due to COVID19, to the IRS being tasked with sending millions of Americans their stimulus checks, the IRS collections proceedings took a backseat.

If you owe back taxes you might just assume you got some breathing room. However, things are starting to pick back up.

According to the Taxpayer Advocate, as of late June 2020, the IRS generated more than 20 million notices, yet these notices were not mailed to anyone. It seems now that the IRS is once again starting to send threatening notices to taxpayers who owe back taxes.

In this article, we share a few things you must do in order to get out of tax trouble and settle your back tax debt.

FILE BEFORE JULY 15th

Before we talk about any tax relief options, you must first get into compliance. That means being current on all your tax return filings, including your 2019 tax return.

If you missed the deadline, you must still file as soon as possible before you begin exploring tax relief options. If you have multiple years of unfiled tax returns, reach out to our firm for help today.

PENALTIES AND INTEREST

Any time you don’t pay your taxes, the IRS first hits you with a club called penalties and interest. Under normal circumstances, these penalties start accruing from day 1 after the tax deadline. Because of COVID19, The IRS is providing additional time to respond before interest or penalties apply.

If your tax bill already has penalties, our firm might be able to help remove some of the penalties by negotiating with the IRS on your behalf.

OFFER IN COMPROMISE

You might have heard advertisements about settling with the IRS, or the IRS Fresh Start program. Not everyone qualifies for it, but if your income or business was drastically affected by COVID19, there’s a good chance you can qualify now. This means the IRS will reduce your tax debt to a fraction of what you owe.

It’s important to hire a tax relief firm like ours to walk you through this process and properly represent you before the IRS. Talking to the IRS before talking to us would be like going to court without a lawyer.

DON’T TALK TO THE IRS IF YOU OWE $10K OR MORE.

Even though things are tough right now, the IRS’s main job is still to collect the taxes it thinks you owe them. That by nature pits them against you. Often talking to the IRS can be a treacherous path and you risk the chance of saying something self-incriminating. Save yourself the headache, time, and money by reaching out to our tax relief firm today. You wouldn’t go to court without a lawyer and you definitely don’t want to approach the IRS without expert representation.