IRS Problems Resolved

IRS to help homeowners

noreply@blogger.com (IRS Problems Resolved) — Fri, 19 Dec 2008 19:23:00 +0000

The IRS announced it will try to make it easier for homeowners in financial straights to refinance or sell their homes. The plan would speed up the process where financially distressed homeowners may request the a federal tax lien be made secondary to liens by the lending institution that is refinancing or restructuring a loan.
They said the program will focus on those people who ordinarily pay their taxes in full "but because of these extraordinary times are getting behind in their tax payments"

Criminal investigation

noreply@blogger.com (IRS Problems Resolved) — Sun, 16 Nov 2008 17:27:00 +0000

In support of the overall IRS Mission, Criminal Investigation serves the American public by investigating potential criminal violations of the Internal Revenue Code and related financial crimes in a manner that fosters confidence in the tax system and compliance with the law. While other federal agencies also have investigative jurisdiction for money laundering and some bank secrecy act violations, IRS is the only federal agency that can investigate potential criminal violations of the Internal Revenue Code

Irs Collections

noreply@blogger.com (IRS Problems Resolved) — Thu, 13 Nov 2008 19:55:00 +0000

With the ecomomy slowing down, massive job layoffs you can expect the Internal Revenue Service to accelerate collections. Never before have they been so aggressive. They will get to your bank accounts and paychecks. You need to resolve your tax issues before they do.

ID Theft Up 644%

noreply@blogger.com (Bryce) — Wed, 09 Jul 2008 19:49:00 +0000

Did you know that we US taxpayers have a national advocate? Well, we do. And recently National Taxpayer Advocate Nina Olson reported to Congress that her office dealt with 644% more cases of identity theft in 2007 than in 2004. Olson’s office fields these calls because these cases are related to stolen social security numbers.

And it seems that the IRS’s “remedies” tend to make things worse. They have resulted in freezing or delaying legit accounts and even collections, liens and levies being applied where they shouldn’t.

Basically it’s a mess.

Olson concludes that the IRS should do a better job educating taxpayers about ID theft. And that’s the right thing to tell Congress.

But taxpayers need to learn to protect themselves and not rely on the IRS. I’ve written about this before so check out Internet Scammers Imitate IRS.

Americans Holding Unreported Funds in Overseas Accounts? NO! Say It Ain’t So!

noreply@blogger.com (Bryce) — Mon, 07 Jul 2008 16:23:00 +0000

OK, so it’s not really that shocking to learn that the wealthier of US citizens might be squirreling money away in Swiss bank accounts in order to avoid the pesky tax man. It’s one of those wink-and-a-nod secrets about which everyone knows.

But the news here is that the IRS is actually going after them. It started on July 1 with a US judge granting the tax collection agency the power to issues a summons to UBS for information about these secret accounts. This one summons reveled $20 billion in unreported funds.

I gotta say I like where this is going!

E-Filing on the Rise

noreply@blogger.com (Bryce) — Sun, 08 Jun 2008 14:40:00 +0000

I suppose it’s really no surprise but efiling increased again this year. The IRS is reporting that 86.3 million US taxpayers did so electronically; that’s a 12 % increase over last year.

Why? Well, it’s impossible to definitively answer that question but there are a lot of contributing factors. The public’s increasing ease and comfort with using the Internet must have helped this trend along. Whether or not this comfort is founded in fact taxpayers and the public in general become more at ease with carrying out private or sensitive transitions online all the time.

Another factor was most certainly the stimulus check. It was made clear that on time, accurate filing of 2007 taxes was key to receiving the stimulus check. No doubt many taxpayers logged on to make sure that their taxes went through properly.

Availability is another factor. Sure, electronic filing has been available for years now but the availability of options and their ease of use must also be considered.

Some companies require a bank account of those that work for them in order to pay them electronically or via direct deposit. I wonder if the day is coming when the IRS will require e-filing and will no longer accept paper taxes.

Section 1031 and Vacation Homes

noreply@blogger.com (Bryce) — Mon, 26 May 2008 14:08:00 +0000

Whether you call it another tax benefit for the wealthy or help for strapped real-estate investors, it’s worth taking note that the IRS has recently clarified their position on swapping vacation homes – you can do it now tax free.

There are the usual rules that specific times, percentages and percentages of time are required to qualify but what it boils down to is that chances are owners of multiple homes now have other way of transferring assets without having to get the tax man involved.

It’s May Fifteenth, Do You Know Where Your Rebate Check Is?

noreply@blogger.com (Bryce) — Thu, 15 May 2008 10:15:00 +0000

I only ask because the IRS has been sending the rebates to the wrong taxpayers. And it’s not just checks but direct deposits, too. 15,000 by one estimate.

I’ll give you a moment to let that sink in…

Why is this happening? The agency doesn’t really know, says IRS spokesman Kevin McKeon. But if the rebate schedule says that you should have already received your then McKeon suggests you visit IRS.gov or call the toll-free service Refund Hotline at 800-829-1954.

Oh, and if you happen to receive some else’s rebate the IRS would very much like it if you would please return it.

Sheesh!!!!

Pastors Giving the IRS the One-Fingered Salute

noreply@blogger.com (Bryce) — Wed, 14 May 2008 13:52:00 +0000

They've had enough and now they're fighting back. Pastors across the US feel that the ban against partisan political rhetoric from the pulpit violates their First Amendment civil right to free speech. Since 1954 the IRS has seen it differently: if churches wish to continue to enjoy their tax-free status they should keep their mouths shut during election season. The pastors argue that other non-profits are able to take political positions and so should they.

So later this year the pastors plan to coordinate a day of protest when they will collectively voice their political views. Watch for it, coming to a church near you on Sunday, September 28.

The IRS maintains that anyone violating this rule will face financial penalties to loss of tax-exempt status.

Who's right? I have no idea but it will be fun to watch!

US Government Acknowledges Tax Credits Are Confusing and Difficult

noreply@blogger.com (Bryce) — Tue, 13 May 2008 11:44:00 +0000

This is one of those bits of news that engenders two distinct and seemingly incongruous reactions. The first is, "Well, duh!" Of course understanding and complying with the IRS vast number of rules and regulations. The other reaction is complete amazement that the tax collecting agency is actually acknowledging that the directions and regulations for at least one particular tax credit are confusing and could have bee presented in a clearer way.

The credit in question is the Hybrid Vehicle Tax Credit. The credit, which is designed to defray some of the cost of the more expensive hybrid technology and encourage growth of the industry, is different for each model and year of production and reduces each year of ownership. Also, neither the dealership that sells the car nor the manufacturer are obligated to provide the taxpayer with any information leaving up to her to research and determine the amount of the credit.

It's easy to see how this whole mess could get confusing. And the Treasury Inspector General for Tax Administration recently did a study where it was determined that the IRS might have done a better job setting the whole thing up. You can read all about it in the report The Complexity of the Law Makes Administering the Alternative Motor Vehicle Credit Difficult.

No Tax Rebate for Foreigners...or Their Spouses

noreply@blogger.com (Bryce) — Mon, 12 May 2008 09:00:00 +0000

Full Disclosure: I have a personal interest in this one as it directly affects my sister and her Ghanaian husband. They've been married for three and a half years and have two kids. While they wait for the interminable process of immigration to play out my brother-in-law works hard at three, yes three, jobs. He works seven days a week, all hours of the day and never complains. In fact he never seems to stop smiling. My sister works a full time job and they are raising four wonderful kids.

But for some reason the IRS decided that my brother-in-law doesn't deserve the stimulus/rebate check. Why, exactly, that is I can't fathom. It seems that it would be rather easy to check the records and see that he's worked steadily and contributed more than his fair share to society not to mention the tax coffers and deserves the rebate just as much as anyone.

But to add injury to injury it's now come out that my sister will likely be excluded from the payoff as well. I really don't know if they file jointly or not but if they do then neither one will receive their check.

Interestingly one of the groups of US citizens this greatly affects is members of the military who married foreign nationals while stationed abroad. While individuals in the government like to trumpet their support for the troops this is yet another example of policy saying otherwise.

Where's My Rebate Check?!?

noreply@blogger.com (Bryce) — Wed, 30 Apr 2008 12:47:00 +0000

As I'm sure is the case with many other tax blogs, we've been getting a lot of hits about the rebate / stimulus checks. Last week the President announced that taxpayers would start getting their money this week but many are still looking for definite dates.

The IRS has published a couple of pages over at IRS.gov that should prove very useful in answering taxpayers' questions. First check out the Economic Stimulus Payment Calculator where you can calculator how much you can expect. As the site points out, this is an estimate but it is helpful.

Once you've determined if you can expect a check you can visit the Stimulus Payment Schedule page. This shows the schedule for payments and direct deposits for taxpayers whose returns were processed by April 15.

If your last two SSN digits are: 00 through 20 then payments will be transmitted no later than: May 2

If your last two SSN digits are:21 through 75 then payments will be transmitted no later than: May 9

If your last two SSN digits are:76 through 99 then payments will be transmitted no later than: May 16

If your last two SSN digits are: 00 through 09 then payments will be transmitted no later than: May 16

If your last two SSN digits are: 10 through 18 then payments will be transmitted no later than: May 23

If your last two SSN digits are: 19 through 25 then payments will be transmitted no later than: May 30

If your last two SSN digits are: 26 through 38 then payments will be transmitted no later than: June 6

If your last two SSN digits are: 39 through 51 then payments will be transmitted no later than: June 13

If your last two SSN digits are: 52 through 63 then payments will be transmitted no later than: June 20

If your last two SSN digits are: 64 through 75 then payments will be transmitted no later than: June 27

If your last two SSN digits are: 76 through 87 then payments will be transmitted no later than: July 4

If your last two SSN digits are: 88 through 99 then payments will be transmitted no later than: July 11

For more details check IRS.gov.

More IRS Email Scams

noreply@blogger.com (Bryce) — Sat, 26 Apr 2008 12:37:00 +0000

I know I've covered this before but it's worth repeating, especially now. With the tax stimulus rebate checks due to start arriving in mailboxes across the US next week taxpayers are eager to get their money and unscrupulous spammers and phishers are willing to take it.

They do this with a flurry of emails with a varying degrees of believability. As I went through my emails this morning I had two. One opened with, "We are pleased to inform you that upon reviewing your fiscal activity, we have determined that you are eligible to receive a tax refund of $252.15."

That kind of specificity made me take another look although I knew that it was a fake.

There are a number of ways to spot a fake email.

First, the IRS does not email taxpayers. It's that simple. Do not believe anything that arrives in your inbox that alleges to be from the IRS. Think about it, have you ever given the IRS your email address? In the normal course of events most taxpayers haven't and the tax collecting agency most certainly does not have time to seek out this information.

Second, check the URLs. Most spammers have become sophisticated enough that they can create a fairly convincing "From" addressee but one thing they can't hide is the embedded URLs in their emails. How can you tell? Float your cursor over the hyperlinked text - the highlighted words that will take you to another website if you click on them - and look in the lower left hand corner of the screen. If you're reading your email on a web-based program the URL will appear. It will most likely not be to the address that it purports to be. For example: IRS.gov See?

Third, does the email ask for personal information? If you receive an unexpected email that claims to be from the IRS, your bank, or anywhere else and asks for any kind of information it is very likely fake.

Overall, remain skeptical.

As for those rebate checks and where yours specifically is, we here at IrsProblemsResolved.com know just as much as you do.

Do Delinquent Tax Debts Appear on Credit Reports?

noreply@blogger.com (Bryce) — Thu, 10 Apr 2008 16:11:00 +0000

In a word, yes.

Often taxpayers overlook the relationship between their tax debt and the credit rating that shows up on their credit report. It is important to understand that tax leins can wind up on a credit report and negatively impact a consumer’s credit rating.

This is because tax liens and other such information is considered public information. Whether this is right or wrong is a discussion for another place but the fact remains. Credit bureaus regularly scan public records so they can provide their customer, the lending industry, as complete a picture as possible of consumer’s credit picture.

If you’re facing a delinquent tax situation it’s a good idea to address it as soon as possible, not only to get the IRS off your back but also to maintain a healthy credit rating.

Contact IRS Problems Resolved now and let’s start solving your tax debt now!

Where Can I Find IRS Tax Forms?

noreply@blogger.com (Bryce) — Thu, 03 Apr 2008 15:35:00 +0000

So you sit down to do your taxes. You’ve been putting it off for months and with less than two weeks left you decide it’s finally time.

You gather up that stack of “tax stuff” that’s been slowly growing since the first of the year and dive it. After getting everything in order and finally getting down to the numbers you realize that the IRS didn’t send you the right forms or perhaps didn’t send any at all. What now? You think that you once heard the post office keeps forms but you don’t want to drive down there and be wrong. Maybe it was the library?

Here are two quick and easy sources. If you have a printer hooked up to your computer you can go to the IRS Forms and Publications page of their site and print out what you need. Or if you can’t or don’t want to print your forms check out this handy IRS office locator. With it you can track down the nearest office to you where you can get the forms you’re looking for and even talk to an IRS employee if you need to.

Audit Triggers - Part 2

noreply@blogger.com (Bryce) — Sun, 30 Mar 2008 14:56:00 +0000

Yesterday I published a couple of likely triggers for an audit. As promised, here are a couple more:

High Income – Although a higher income should be considered an advantage under any other circumstance, considered from the perspective of prospective audits it is most certainly a disadvantage. And the chances of an audit jump up significantly with each income level. Past audits tell us that the chances of an audit for taxpayers making less than $100,000 is 0.93%. For incomes over $100,000 the chances jump to 1.77%, over $200,000 brings the odds up to 2.87% and over $1 million in income brings the chances of an audit to a whopping 9.37%!

Self-Employment – Because self employed taxpayers are constantly keeping an eye on their bottom line they tend to be aggressive at writing off expenses. While there are many legitimate reasons for doing so the IRS likes to verify these deductions.

While these are some of circumstances that may trigger an audit they do not necessarily guarantee one nor will avoiding them remove all possibility of one. The best defense against an audit is to always expect one. Taxpayers should make sure that their deductions are legitimate and reasonable. They should also keep well ordered records and receipts.

However never having to face an audit is certainly the best circumstance. Keeping these triggers in mind can help taxpayers reduce the risks of that happening.

Audit Triggers - Know what the IRS is looking for...

noreply@blogger.com (Bryce) — Sun, 30 Mar 2008 14:53:00 +0000

With the tax clock ticking down lots of people are finishing up their tax returns. A common question that comes up during this joyous time of year is, “How can I avoid an audit?” Fortunately for most taxpayers the question is far more common than an actual audit. Only around 1% of all taxpayers actually end up facing an audit.

Comforting as that fact is, it is in no way instructive. Knowing what is more likely to trigger an audit can go a long way to avoiding one. Avoiding these triggers will not guarantee that an audit will not occur but it will reduce the chances of one. While all of the reasons that the IRS launches an audit aren’t known, crunching the statistics of past audits does demonstrate some clear triggers.

High deductions – Any deduction that is proportionally high to the taxpayer’s income usually constitutes a red flag. Determining what’s high is the trick here. The IRS publishes an annual book, “Statistics of Income.” Although the book gives ranges for typical incomes some logic needs to be applied. If a taxpayer is at the lower end of a particular income range but claims the upper limits of deductions associated with that range then that deduction may still trigger an audit review even though the deduction is technically within the accepted limit.

Cash Income – Any profession that deals with a lot of cash, such as waiting tables, tends to spark the curiosity of IRS audit agents. One of the first things they compare in cases such as this is bank deposits vs. claimed income.

These are a couple of common triggers that can set off an audit. Tomorrow I'll share another couple of potential red flags. Remember, avoiding these doesn't necessarily guarantee avoidance of an audit but it can certainly reduce the possibility of one.

The IRS Wants to Hear from You

noreply@blogger.com (Bryce) — Tue, 25 Mar 2008 15:22:00 +0000

Got some advice for the IRS? They want to hear it.

The US tax collection agency is looking for citizens who want to give their input about how it does its job. To qualify prospective panelists will need to pass a criminal background search and be willing to commit between 300 and 500 hours per year. Oh, yeah, their taxes need to be up to date, too.

For more information check out www.improveirs.org or call 888-912-1227. The deadline is April 30.

Where’s My Check?

noreply@blogger.com (Bryce) — Sat, 01 Mar 2008 15:54:00 +0000

The first rebate check from the IRS likely surprised more than a few recipients. Even with all the press it got, did anyone really expect it to come through? I mean the IRS actually giving back money?!? It just didn’t add up.

But this time around is different. History proves that it can really happen and now that we’ve heard more than a few times from Washington to expect a check this year people are asking questions. They are starting to wonder exactly when their check will come, what they can do to make it come faster and how they can make sure that they are eligible.

Trust me; IRSProblemsResolved knows that these are the questions that people are asking because they’re asking us these questions. Fielding these queries has become a pretty regular occurrence here at the office.

So, it’s not with a little relief that I can now report that the IRS has set up a special phone number that taxpayers can call with questions about the 2008 stimulus package checks. The IRS announced that people can call (866) 234-2942 with questions about their checks. There is also information available at IRS.gov.

Other problems with the IRS like back taxes, threats of levies, wage garnishment, etc. are where we shine. If you’re facing these sorts of issues or have other problems with the IRS we’d be glad to talk to you about them. Contact us with your IRS questions here.

What’s Keeping You Honest?

noreply@blogger.com (Bryce) — Fri, 29 Feb 2008 14:34:00 +0000

Most people are honest and most honest people are that way for two reasons. First because they feel that being honest is the right thing to do. Second they are honest because they fear the consequences of getting caught being dishonest.

I suppose that that’s common sense but IRS decided to take a poll to make sure. They found that 84% of people believe that cheating on one’s taxes is unacceptable. But 54% said that they don’t cheat because of fear of an audit. Further 61% admitted that they accurately report their income because they knew that a third party like their employer or clients had already reported their income. But 87% said that personal integrity also played a role.

So, basically, we’ll cheat as long as we think we can get away with it and as long as we can feel good about ourselves while we do it. Sounds about right to me!

Love Letter from the IRS

noreply@blogger.com (Bryce) — Fri, 29 Feb 2008 14:22:00 +0000

I don’t know about you but whenever I go to the mailbox and see that I’ve received mail from the IRS my first thought is, “Great, what now?” My second thought is, “How much is it going to cost this time?” The answer to both of those questions is rarely good.

Well, that’s not necessarily going to be the case in the next few weeks. The IRS is sending out millions of letter to US taxpayers. These particular letters will be explaining when and how we can receive our chunk of the stimulus package.

Is Your Small Business Taking Enough Deductions?

noreply@blogger.com (Bryce) — Tue, 26 Feb 2008 14:47:00 +0000

CNN Money just published a great article exploring the myriad ways that small businesses actually help the government screw them out of more tax money than they really should pay. It’s worth your time to check it out and see if you are due more deductions than you’re actually taking.

The article suggests reviewing things like the way that your deductions are categorized. A great example that they use is that small business owners will sometimes categorize their hotel bill for out-of-town trips at “entertainment” which only gives them a 50% deduction. The correct category, “lodging,” will garner 100%. Which deduction would you rather take?

The article is full of useful suggestions like that. But don’t take it too far! The author makes a great suggestion: the laugh test. If the proposal of a deduction causes you to snicker – like the lawyer who invited his clients to his daughter’s wedding then tried to write the expense off as a business meeting – then you’ve probably gone a deduction too far!

A 7 Year-Old’s Tax Troubles

noreply@blogger.com (Bryce) — Mon, 25 Feb 2008 14:14:00 +0000

A boy in Carpenterville, Ill recently received a notice from the IRS informing him that he owed taxes on $60,000 worth of income. The agency also informed his mother that should could no longer claim her son as a dependent.

This is not the story of an enterprising child who started a wildly successful business in his parent’s garage; it’s a story about identity theft.

Shortly after the young man was born in 2001 his identity was stolen. His Social Security card wound up in the hands of Cirilo Centeno who used the information to obtain a truck, three separate jobs, gas and electrical service for his home, a credit card, unemployment benefits twice for a total of six months, and over $60,000 in pay and services.

Centeno’s court date is March 12.

2008 IRS Collections: No More Mr. Nice-Guy?

noreply@blogger.com (Bryce) — Tue, 29 Jan 2008 13:35:00 +0000

With their latest collections innovation a failure and increasing pressure to meet their goals, are IRS collectors going to be tougher this year than ever before? The scuttlebutt says yes.

The IRS is having trouble. With a recession looming and the inability of third party collectors to perform as they were expected to the tax collecting agency is having trouble meeting its goals. Naturally, the logical solution is to increase pressure on taxpayers to pay in full and on time.

What’s a taxpayer to do? For many the solution is easy: pay up and pay promptly. But for some this isn’t an option. That’s when it’s time to think about hiring an advocate to help deal with the IRS. This is different from hiring an accountant who will simply crunch the numbers and tell you what you owe. An advocate like IRS Problems Resolved will help you deal with the IRS and find a solution to your tax problem.

Ready to talk to someone about your tax problem? Contact us right now or simply call 888-301-0833.

Third Party Tax Collections are Failing

noreply@blogger.com (Bryce) — Sat, 19 Jan 2008 15:14:00 +0000

That’s according to National Taxpayer Advocate Nina Olson. (I didn’t even know we taxpayers even HAD an advocate!)

The program called private tax debt collection (PDC) has been being phased in since 2006 and is due to be fully implemented this year. It was expected to bring in $1.5 billion to $2.2 billion in delinquent taxes over the next ten years with a yearly average of around $185 million. The IRS is now projecting that these were overly ambitious projections; they only expect $33 million for FY 2007.

What’s the problem? Olson says that “the IRS has placed the interests of the PDC above the interests of taxpayers and tax administration.” She further criticizes the program for failing to require the private collectors to disclose their training materials, phone scripts and overall collections plan, something that the IRS does have to do. The PDC has also been criticized for costing more and placing a greater risk on taxpayer privacy than if the job were left to IRS workers.

Those opposed to the program see the IRS’s announcement that they will not reach their projections nor show significant improvement in collections under the PDC as vindication and are calling for it to be shut down.