IRS Fresh Start Program
We get it, you are enjoying your life in the North Star State or the Badger State and the IRS has to ruin it. Maybe you have a lot of tax debt or many years of not filed or late returns that you have put off. Now the IRS contacts you. What do you do now? The best course of action is to head off the IRS actions before they go on further. This is where we come in. We have been serving residents of Minnesota and Wisconsin to correct their tax debt issues for a long time.
Offer in compromise
An offer in compromise allows you to settle your tax debt for less than the full amount you owe. It may be a legitimate option if you can't pay your full tax liability, or doing so creates a financial hardship. The IRS considers your unique set of facts and circumstances, such as, your ability to pay, income, expenses and the equity in your assets. You need professional representation to get an offer accepted that does not break the bank for you. That's where we come in. The professionals at Tax Center USA will settle your tax debt for the lowest possible amount.
An IRS installment agreement or payment plan is an agreement with the IRS to pay the taxes you owe within an extended time frame. An installment agreement or payment plan is used if you believe you will be able to pay your taxes in full within the extended time frame. The payment plan can be set up allowing you to pay it off in a timely and affordable manner for you. The benefits of a payment plan is that you will stop accruing additional interest and penalties, stop the IRS from taking any future tax refunds and take away any problems dealing with banks, such as, obtaining a loan or opening an account. Payment plans are different depending on how much you owe. We can set up the best option for you.
Prior Year or Unfiled Tax Returns
Personal and Business, We can get your returns filed no matter how late they are. It's always best to file yourself instead of the IRS filing for you. It's just a matter of time before the IRS catches up to you. We can beat them to the punch and make sure your tax return is filed correctly. You need to have a certified public accountant (CPA) that is experienced in filing multiple years of unfiled tax returns. At Tax Center USA, we have the professionals with the education and experience that you need to fix your tax situation.
Back Taxes owed
You filed your taxes but could not pay at the time. So you ignored the debt and hoped that it would go away. Of course, it didn't. Now interest and penalties are adding up really fast. But that is not the end of the world, we have so many options to correct this situation. We do this every day. We know exactly how to tackle your tax problems in a way that will put you in the best position.
Payroll Tax Debt Relief
This one gets so many businesses in trouble. The penalties and interest added for not paying your payroll tax and filing your payroll tax returns can be severe. The IRS is relentless when collecting back payroll taxes. But this can be corrected. Didn't file forms 941 and 940? We can take care of this for you. We have many years of experience dealing with payroll tax debt issues. This one cannot be ignored. The professionals at Tax Center USA can fix all of your payroll tax problems.
An IRS lien is an encumbrance on your property to secure the tax debt that is owed to the government. A lien can be placed against you or your business. Liens will show up on your credit report and will basically ruin your chance for doing anything at a bank such as opening an account, getting a loan, buying and selling your home. This can be fixed. We fix IRS problems every day.
An IRS Levy can wipe out all of your bank accounts. There's no end to which a Levy by the IRS can go. They can take your checking and savings account, your car, stocks and bonds, anything of value that they can use to settle your tax debt. We can fight against this. We can give you a fresh start with the IRS with the many solutions available.
The IRS can legally take a portion of your paycheck. Imagine waiting for your paycheck, having already planned out how you were going to spend it and it's gone! It happens all the time. We can negotiate the release of IRS wage garnishments by arranging a payment plan or one of the other solutions available in your situation. We can make this happen.
IRS seizures is the taking of physical assets, such as your car, home or business property. This is usually the worst case scenario when dealing with the IRS. Assets seized by the IRS are sold at auction. They will sell your assets to the highest bidder with no regard to the value of your assets. Often times, for pennies on the dollar. The worse thing, you could still owe the IRS even after they have taken everything. WE CAN STOP THIS FROM HAPPENING. It should never get this far. Let us help you.
Innocent Spouse Relief
Don't become the victim of what your spouse did. We can help. In many relationships, the financial duties are in the hands of only one spouse and sometimes that gets people in trouble with the IRS.
IRS Notices and Letters
This is how it all starts, one of the first things that the IRS will do is to send you letters and notices and more letters and notices! They can be extremely difficult to understand. Fortunately for you, we have many years of experience and education on how to best respond to the endless stream of letters and notices that the IRS will send out to you. We can make the letters and notices stop from the IRS with a well developed plan in place.
IRS Revenue Officer
The IRS will escalate matters quickly at times. That's when they will send an IRS revenue officer to your home or business in Minnesota or Wisconsin. You do not want to deal with an IRS revenue officer alone without proper representation from a qualified certified public accountant that specializes in tax problems. We can make the IRS revenue officers stop harassing you. We can take over all communication and negotiation with the IRS on your behalf.
Dealing with the IRS can be one of the most stressful times that a person will ever experience. It doesn't have to be. We can take over for you so you don't have to worry about what to do or what not to do. We have the education and experience that puts you in the best position.
Do You Have a Federal Tax Lien or IRS Notice of a Federal Tax Lien?
IRS Tax Liens can really take your perfect life and make it miserable! When your taxes are unpaid, the IRS and or the State files a lien against all your assets. This gives them the legal right to collect taxes from the sale of your assets, which includes literally everything you own including your bank account, vehicles, and home. Tax liens may be filed against you, your spouse, or your company depending on how the tax liability was incurred. Everything you own is in jeopardy of becoming property of the government. Never ignore a notice from the IRS – it can have very serious consequences.
To make matters worse, tax liens filed against you show up on your credit report and often prevent you from opening a checking account or borrowing against any assets, like your home. If a lender is willing to approve a loan for you, the interest rate will be higher when a lien appears on your credit report. Buying or selling real estate is would be very difficult as well. Remember, the IRS can place a lien on your property, home, vehicle, or wages or even go as far as seizing your property to collect the back taxes. Contact our Nationwide Tax firm immediately so we can begin to negotiate on your behalf. When you work through an accounting firm, it can show the IRS that you are trying to resolve the issue quickly.
The good news is, unlike most local area tax firms, we specialize in solving tax problems and we can help get you back in compliance and remove any liens that you have on your assets. We have helped a lot of happy clients get back on track with the IRS and we can help you too!
We can help remove tax liens!
Tax liens can be removed once the government is satisfied that you are compliant, so getting compliant is step number one in the process. That could be filing back tax returns, setting up an installment agreement, or enrolling in one of the other IRS settlement programs. The good news is once your tax problem is solved we can get tax liens erased from your credit report! If you have a tax problem and need our help call us today at (833) 482-9872.
Once you become our client you will not have to speak to the IRS anymore. If they want information or to talk to you, they will have to go through us. The first step to getting a tax lien removed is calling us at (833) 482-9872 and scheduling a free no obligation case evaluation with one of our Certified Public Accountants. During this meeting we will discuss the details of the case and make plans to start the investigation. During the investigation phase of your case we will be gathering information, pulling transcripts, and finding out what the IRS knows about you.
We can help, but not until you call (833) 482-9872.
Unfiled Tax Returns and Late Tax Returns
Having many years or even one year of unfiled tax returns is not a situation to take lightly, failing to file your tax returns is a criminal offense that the IRS takes very seriously. If you do not file, you can be prosecuted and punished, possibly with jail time and have to pay hefty fines. The possible jail times are up to one year for each year not filed. Do not put your valuable freedom on the line over failing to file your tax returns with the IRS.
Tax Center USA have helped thousands of people file unfiled returns. Let us give you peace of mind by helping you get into compliance with the filing requirements of the IRS. If you voluntarily file your delinquent returns, you will likely avoid further problems other than having to pay the interest and penalties. If you wait for the IRS or State to file your returns for you, they will be prepared in the best interest of the government. The IRS will not include exemptions, deductions, or credits that could reduce the tax amount. This is called a substitute for return and it is never in your best interest. In most cases, you will likely owe taxes, interest, and penalties after the returns are filed. Once we see how much is owed, we will put together a plan of action to resolve the penalties, interest and taxes that is owed to the IRS. Let us help you get those unfiled returns filed. Call (833) 482-9872 today.
We can help with unfiled or late Tax Returns!
Most of the time, we can prepare and file unfiled returns avoiding the risk of such harsh penalties. In a lot of cases, the IRS has already prepared a return for you and assessed the tax based on that return which the IRS calls a substitute for return. These IRS prepared returns will include all the income items that the IRS knows about and will not include any deductions, exemptions or credits you are entitled to claim for yourself. The tax assessed based on the IRS prepared return will always be higher than the amount that we determine using all the available deductions, exemptions, and credits that you are entitled to in your particular situation. If you have a tax problem and need our help call us today at (833) 482-9872.
Once you become our client you will not have to speak to the IRS. In fact, we do not want you to. If they want information or to talk to you, they will have to go through us. The first step to getting tax problem help is calling us at (833) 482-9872 and scheduling a free, no obligation tax case evaluation with a Certified Public Accountant.
Have You Missed Paying Payroll Taxes? We Can Settle Payroll Tax Debts
If your business pays income to employees, you must withhold payroll taxes from their wages, including Medicare, Social Security, and federal income taxes. You are also responsible for depositing the income tax withheld and filing quarterly payroll tax returns with the Internal Revenue Service.
If you are late depositing payroll taxes or filing your return, the IRS will impose 941 late payment penalties. The IRS can be very aggressive in collecting the tax debt, not only from your business but also from the owners and officers. They can even garnish your business accounts and file tax liens against your assets. To lift these penalties, you need the help of a tax accountant with years of experience settling payroll tax debts for employers like you.
Payroll Tax Problems
The absolute most serious of all tax problems is the failure to collect and pay to the government any payroll taxes that were withheld from employees. These payroll taxes are referred to as trust funds and are strongly collected by the IRS. When the IRS detects stacking of payroll taxes through the continued payment of net wages and the continuing failure to remit the related payroll taxes, they will not hesitate to seize assets and close the business down. If you are delinquent in the payment of payroll taxes, it is extremely important that you tackle the issue at the earliest possible time.
We can help with Payroll Tax Problems!
At Tax Center USA, we are payroll tax problem experts! We have worked with hundreds of businesses over the years get back on track and stay in business. Timing can be very important in payroll tax problem cases, and you need to contact a tax accountant today. Call us today at (833) 482-9872.When you become our client, you will not have to speak to the IRS anymore. If they want information or to talk to you, they will have to go through us. The first step to getting tax problem help is calling us at (833) 482-9872 and scheduling a free, no obligation case evaluation with one of our tax accountants. Let us help with your payroll tax problem. Call (833) 482-9872 today.
When Are You Required to Deposit Payroll Taxes?
If your business reported a total of $50,000 or less in tax liability for the prior four quarters, you must deposit taxes each month by the 15th day of the following month. If you reported more than $50,000 in taxes, you must deposit biweekly (once every two weeks) depending on your payday.If payday falls on a Wednesday through Friday, you must deposit taxes by the following Wednesday. If payday is Saturday through Tuesday, you must deposit taxes by the following Friday.
Late Deposit Penalties for Payroll Taxes
If your payment is less than 5 days’ late, the IRS charges a penalty of 2 percent of the unpaid tax. Deposits made 6-15 days late are charged a 5 percent penalty. If your payment is more than 16 days late, the IRS charges a 10 percent penalty. You will also accrue interest on any unpaid balance.
When and How Must You File your Payroll Taxes Form 941?
You must file Form 941, the business quarterly tax return, by the last day of the month that follows the end of the quarter. For example, if your quarter ends in May, you must file a return by June 30 to avoid 941 late payment penalties. If you fail to file your quarterly tax return by the deadline, the IRS will assess a series of penalties.
Late Filing Penalties
For each month or partial month that you are late filing Form 941, the IRS imposes a 5 percent penalty, with a maximum payroll tax penalty of 25 percent of the unpaid tax due. The IRS also adds a 0.5 percent tax for each month or partial month you are late in paying the tax.
How to Pay Late Payroll Taxes
To pay late payroll taxes, use the Electronic Federal Tax Payment System, or EFTPS. If you do not have an account, you can create one by providing business details including employer identification number, bank account information, and routing numbers at eftps.gov/eftps/.
Once the IRS has verified your information you will receive a letter five business days later. You can then make your late payment including penalty using Form 941. To avoid penalties for late payroll taxes, you need a tax relief accountant who can assess your financial situation and create the best tax solution for you. Even if you are not eligible for penalty abatement, you can settle your payroll tax debt for less than the original amount with an Offer in Compromise or by negotiating a payment plan.
IRS Bank Levy
The IRS uses several collection activities to get back tax debts owed by taxpayers. A bank levy can cause a lot of damage for people who fail to pay their state and federal taxes. In a bank levy, the IRS seizes your bank account funds to cover your tax debt. Usually, the IRS will first contact your bank to notify it about your tax debt. Then your bank will freeze your account for 21 days from the time of the notice.If you do not take any action to resolve your tax debt during that period, the bank will send the money taken from your account that you owe to the IRS. This could be your entire account balance. An IRS bank levy is typically considered the last line of attack by the IRS. You will only be subject to this collection method if the IRS has contacted you several times without getting any response.
We Help You Find the Best Tax Solution
At Tax Center USA, we understand that IRS tax problems can significantly affect your day-to-day life, business, and most importantly, your financial stability. If you have received a bank levy notice, we will carefully evaluate your overall financial situation and come up with a solid plan to help you find the best tax solution. We do our best to have your bank levy released using several effective tax resolution methods to avoid the seizure of your bank account. The many different options include:
Applying for a Fresh Start Program
Preparing an installment agreement
Preparing a partial payment agreement
Preparing an Offer in Compromise
Negotiating for an affordable payment plan
Releasing the bank levy
Call for a Free Consultation at (833) 482-9872
If you feel that an IRS bank levy is likely to create a financial crisis, or you learn that the IRS has already frozen your bank accounts, you should seek immediate tax relief help. If a bank levy would cause significant financial hardship, the IRS may release the levy. Our dedicated and caring bank levy accountants will work with you to assess your financial situation and present your case to the IRS to get the bank levy released.
At Tax Center USA, we always encourage potential clients to resolve their tax debts as early as they can. Do not let the IRS take away your bank accounts. Talk to our knowledgeable tax resolution accountants to help you find the most reliable solution to end your tax debt problems. Call our office at (833) 482-9872. Request a free consultation to discuss your bank levy concerns today.
IRS Interest and Penalty Removal
If you have not paid taxes and related penalties, or even not filed tax returns, you could be relieved of IRS tax penalties and interest in the form of an IRS penalty abatement. The main way to attain penalty abatement is to show that the failure to comply was due to reasonable cause. Under this IRS penalty abatement program, you can get a reduction or removal of penalties and interest charged on your tax debt. Tax Center USA is here to help you make a request for penalty abatement.
Important Information about IRS Interest and Penalty Removal
If you have unpaid taxes, the tax debt you owe the IRS increases with every new month by adding more IRS penalties and interest. Any tax debt that is not paid in full by the tax filing deadline is subject to those penalties and interest. IRS penalties can add up and compound very quick. These penalties and interest are typically charged to encourage taxpayers to pay their tax debts in full as early as possible. The longer you wait, the bigger your tax liabilities continue to grow. You may qualify for IRS penalty abatement if you did not file returns, pay taxes, pay penalties, or pay interest because of a situation that was out of your control.If you need help requesting IRS penalty abatement for failure to pay, failure to file, or failure to deposit penalties, you should get a free consultation with the experts at Tax Center USA. We help you figure out whether you should apply for penalty relief depending on your individual circumstances. The IRS and State both increase the amount a taxpayer owes by adding penalties and interest to the unpaid tax. In many cases, a taxpayer could pay the tax, but thanks to the penalties and interest, the ever-expanding balance quickly becomes unmanageable. Penalties and interest might be reduced or eliminated if you can demonstrate reasonable cause and prudent action. We may be able to pair your Penalty Abatement with an Installment Agreement or an Offer in Compromise and get you back on track with the IRS.
To ensure the request for penalty and interest removal is successful, we will create an estimate of your IRS tax penalties and interest, assess the facts about your financial situation, evaluate the circumstances that prevented you from paying your tax debt and create a solid plan to get the best IRS penalty abatement resolution possible. After we get the IRS penalties and interest removed, we will help you settle your tax debt through either an Offer in Compromise or an affordable tax payment plan that suits your financial situation.
Once you become our client you will not have to speak to the IRS anymore. If they want information or to talk to you, they will have to go through us. The first step to getting tax problem help is calling us at (833) 482-9872 and scheduling a free, no obligation case evaluation with a Certified Public Accountant. During this meeting, we will discuss the details of the case and make plans to start the investigation phase of your case by gathering information, pulling transcripts, and finding out what the IRS knows about you.The Penalty and Interest portion of IRS tax debt can be quite significant in many tax debt cases. If you are facing penalties for not filing or paying your taxes on time, you may be able to get those penalties removed through penalty abatement or penalty adjustment. Abatement refers to eliminating an assessed tax liability and an adjustment refers to reducing or altering an assessed tax liability.
If there is a reasonable cause for abatement or adjustment, the IRS may be willing to review the penalties which created a tax liability. Reasonable cause could be that you lost your paperwork, or it was stolen from you by a spouse or a disgruntled former partner. Reasonable cause could be that there was a death in the family, or you were a victim of a crime.
We can work with you to make payment arrangements that the IRS will allow. If there were circumstances beyond your control that prevented you from paying your tax debt and led to delinquency, we can challenge the penalties and interest that have built up. Relief from penalties falls into four different categories: Reasonable Cause, Administrative Waivers, Statutory Exceptions and Correction in Service Error.We have the education and experience to provide tax penalty abatement in your tax debt case. We would love to discuss your options with a free tax consultation at 833-482-9872.
Offer in Compromise
Get Help with Your Offer in Compromise
Life can be very unpredictable. Through no fault of your own, losing your job, unemployment, changing business income, huge medical bills, and other unexpected monthly expenses can result in a huge tax obligation that you cannot pay in full. Luckily for you, those who want to pay their taxes but cannot afford a lump sum now have several potential solutions. You might qualify for one of the major tax relief solutions, an IRS settlement offer known as an Offer in Compromise. An Offer in Compromise is one of the most underused and misunderstood IRS tax relief options, but it can be the perfect solution for IRS tax relief. At Tax Center USA, we will work closely with you so that you understand your tax situation and how to resolve it. We will provide all the Offer in Compromise assistance you need, starting with whether you qualify for the program and the details of the low-income certification guidelines.
What is an IRS Offer in Compromise?
An Offer in Compromise is an IRS tax relief settlement between the taxpayer and the IRS, when the IRS usually accepts less than the entire tax debt owed. If you qualify for an IRS settlement offer, all your tax debt can be cleared. In only 2018, the IRS accepted nearly 30,000 offers which resulted in around $287 million in tax relief.
Reduce Your IRS Debt with an Offer in Compromise
Qualifying for an offer in compromise settlement can save you thousands of dollars in taxes, penalties and interest. An offer in compromise is an agreement between a taxpayer and the IRS to settle the taxpayer’s tax due for less than the full amount owed. Without special circumstances, an offer will not be accepted if the IRS believes that the liability can be paid in full as a lump sum or through a payment agreement. For example, if you owe the IRS 25,000 and make 250,000 per year – you would not qualify for an offer in compromise.
Beware of unscrupulous advertisers that claim tax debts can be settled through the offer in compromise program for pennies on the dollar. The offer in compromise program is very complex and time consuming, sometimes taking up to two years to complete. Tax Center USA has the expertise and experience in working with the IRS to help expedite and take the stress out of the process.
Types of Offers in Compromise
Lump-Sum Offer. This requires a taxpayer to pay an agreed upon reduced amount to the IRS within five or less months from the date that the offer is approved. You must pay a 20% down payment when you submit the offer and an application fee to the IRS unless you qualify for a hardship. An offer in compromise can be quite complex so it is essential to receive Offer in Compromise help to complete the specifics of this offer. We have successfully submitted many offers in compromise that have allowed our clients to get their lives back on track and the IRS off their back.
Periodic Payment Offer. This offer must be paid within 6 to 24 months. In addition to application fees, the first payment is the same 20% down payment required for lump sum cash offers. Tax Center USA offers free consultations to make sure you do not waste time and money submitting offers that are rejected by the IRS because you checked the wrong box or missed an item on one of the many forms.
Qualifications for an Offer in Compromise
For the most part, the IRS considers your unique set of facts and circumstances to determine if you qualify including your:
Ability to pay your taxes
Assets and equity
To qualify for an IRS settlement offer, the IRS must determine that one of the following conditions exist:
You cannot afford to pay the full tax amount due. The IRS will assess your situation and determine if you cannot afford to pay the full tax debt before the statute of limitations ends which is generally 10 years.
Economic hardship. Paying your full tax debt would cause you economic hardship. In most cases, you must already be working full time which is considered 30 hours per week for at least the next 3 months and still be unable to meet your basic needs if you pay your full tax debt owed. For example, you owe 100,000 but are working a minimum wage job.
Doubt over the tax debt you owe. When there is doubt over whether you actually owe the tax or there is doubt about the accuracy of the amount owed, the IRS may offer a settlement instead of using the time and money required for an in depth tax audit.
To be eligible for the any of the above IRS settlement offers, taxpayers must be sure that they have filed all their required tax returns on the appropriate forms and be current with estimated tax payments for business owners and self-employed individuals while keeping track of federal tax deposits for businesses with employees. The tremendous amount of paperwork that must be completed with perfect accuracy is enough to keep many taxpayers from settling with the IRS, but this does not have to be you. We have your back and can take on all the hard work.
Why not take advantage of the Offer in Compromise program that allows you to pay an amount you can afford to satisfy your entire tax liability, and it even includes the penalties and interest. Remember, the amount you pay is based on what you can afford and not on the amount you owe. The offer in compromise program allows any eligible taxpayer to pay what they can afford to pay regardless of the amount they owe. The Offer in Compromise is truly a fresh start. When an offer is accepted by the IRS and paid the taxpayer is then current with all their tax liabilities.
Once you become our client you will not have to speak to the IRS anymore. If they want information or to talk to you, they will have to go through us. The first step to getting tax problem help is calling us at (833) 482-9872 and scheduling a free, no obligation case evaluation with a Certified Public Accountant. During this meeting, we will discuss the details of the case and make plans to start the investigation phase of your case by gathering information, pulling transcripts, and finding out what the IRS knows about you.
IRS Payment Installment Plan
What is an IRS Payment or Installment Plan?
An IRS payment installment plan allows taxpayers to take care of their tax debt through monthly installment payments. The total amount of your plan is determined by the amount you owe and how long the IRS will wait to collect the debt. This can be an option for those who do not qualify for an Offer in Compromise. If you cannot afford to pay your tax debt in a lump sum, the IRS offers a partial payment installment agreement depending on your ability to pay and IRS financial standards. To properly create an IRS payment plan, you need the best IRS tax accountant who will thoroughly evaluate your tax debt and calculate the lowest monthly amount that the IRS will accept from you.
Do I Qualify for an IRS Payment Installment Plan?
If you owe the IRS $100,000 or less, you may qualify for an IRS tax payment plan. Under the current IRS Fresh Start Program, you may qualify to pay your tax debt with 72 or 84 monthly installments. Though, you must be current on this year’s tax obligations. IRS installment plans also have certain disadvantages. Penalties and interest continue to accrue until you pay your debt in full. Combining tax debt with IRS penalties can result in interest rates as high as 10% per year.
Do not try to negotiate an IRS Installment Payment Plan by yourself. At Tax Center USA, we know that a large tax debt can create many problems. We will help you complete a Collection Information Statement, create a payment plan you can manage, propose a monthly amount you can afford and decide the best way to make payments once your plan is approved. Do not put it off anymore. We simplify the whole process for you and carry the burden of the rules and paperwork so that you can get away from the stress. If you are wondering whether you can qualify for an IRS tax payment plan, do not hesitate to contact our experienced tax relief accountants. Your IRS installment payment plan must be submitted accurately by an experienced tax accountant or your plan could be rejected by the IRS. Take the first step toward resolving your looming tax concerns. Contact us today for a free consultation at 833-482-9872.
We can secure for you an installment agreement with the IRS to allow monthly payments on your tax liability. The agreement keeps the IRS or the State from levying if the payments are paid as agreed. Without an installment agreement, the IRS or State may take all but a small amount of your paycheck through a wage garnishment. They could also levy bank accounts and file liens on all your assets including your vehicle or home. We may be able to combine an Installment Agreement with a Penalty Abatement to save money and get time to pay the rest.
If you do not qualify for the offer in compromise program, an IRS Installment Plan may be the best way to resolve your tax debt problem. Setting up a payment plan with the IRS allows time to pay your tax debt. Sadly, the IRS continues to add penalties and interest to any unpaid balance. The greatest benefit of an IRS payment plan is that the amount of payment will consider your living expenses and provides protection from additional enforced actions. The IRS will release levies they have filed once your payment plan is approved and they will not file any new levies if you make the agreed upon payments.
The IRS may agree to let you pay your back tax debt off gradually in monthly installments if you cannot pay your tax debt in full.
The IRS may be a difficult and demanding agency to work with, but it is also highly practical and straightforward. The IRS understands that it simply cannot take money that doesn’t exist. If you don't have the money, you can't pay. Allowing taxpayers to pay back tax debt over time can often be the easiest and best way for the IRS to collect all the money it is owed.
Installment plans are great options that work well for both the IRS and the taxpayer. Though you will usually have to pay penalties and interest, setting up a payment plan through successful tax resolution can get you back on a track so that you can become free of your tax debt.
An installment agreement can be either formal or informal. In an informal installment agreement, the taxpayer promises to make monthly payments in an agreed amount which will pay off his balance within two years. A formal installment agreement is a written agreement in which the taxpayer promises to make, and IRS agrees to accept, monthly payments in a specified amount. A taxpayer can allocate payments, such as against the trust fund portion of employment taxes, under an informal installment agreement but not under a formal installment agreement.
The IRS is very reasonable when it comes to accepting an installment plan for back tax debt. Their goal is the same as yours. To move on and put this behind you. Take the first step and let us set up a payment plan that works in your favor. Call us for a free tax consultation at 833-482-9872.
IRS Currently Not Collectible
What can you do if you can no longer pay your outstanding tax liabilities?
Tax Center USA can help you get a much-needed break from the horrible stress of the IRS on your back by getting you placed on IRS currently not collectible status. This status is only gained after the IRS evaluates your financial situation and determines that you cannot afford to pay off the tax debt in your current situation in full through an installment agreement.
What Happens to You When You Have IRS Currently Not Collectible Status?
When the IRS closes your case and determines you have currently not collectible status, the IRS stops its collection activities immediately. Although, any penalties and interest owed will continue to build on top of your tax debt. If and when your financial situation improves over time, your tax account will be taken off the Currently Not Collectible status which allows the IRS to start collecting the tax debt through either full payment or an installment agreement. If you are currently in no position to pay your taxes, our experienced and professional tax accountants will work with you to ensure you are placed on IRS currently not collectible status. We will carefully assess your financial situation to ensure you meet the qualifications for an IRS currently not collectible status. We will work with you to show the IRS that you are undergoing sufficient financial hardship. For example, we may need to prove to the IRS that you have no extra income at the end of each month for the IRS to close your case with a finding of currently not collectible.
If there is absolutely no way for you to pay your tax debt, and no way for the IRS to collect the money owed by the more traditional forms of tax resolution options, you can file for “currently not collectible” status.“Currently not collectible” means exactly how it sounds. The IRS will not be able to collect any owed taxes or penalty charges if:
Your wages cover no more than your necessary living expenses so that there is no amount the IRS can garnish
You have no assets worth levying. Remember that the IRS cannot seize an asset if you have less than 20 percent equity in the item or if the expenses involved in seizing and selling it are more than the equity is worth. This makes the IRS seeking another form of tax resolution unlikely.
Just because you have nothing worth the IRS taking from you is not exactly a great position to be in, but it can help in dealing with them. If your account is deemed to be uncollectible, the IRS will stop the collection process until your financial situation improves and another form of tax resolution becomes more realistic.
Interest and penalties will continue to build up against you, and you will have to provide financial statements each year to show whether or not you are still currently unable to pay.
The IRS collection process will resume if your financial statements show that your situation has improved enough.
But if the 10-year statute of limitations for back taxes expires while you have currently not collectible status, the tax debt itself will become permanently not collectible and no other form of tax resolution will be needed.
We have the education and experience that you need to put you in the best possible position in negotiating with the IRS. Call us today for a free consultation. 833-482-9872.
Forming an LLC
Why Should You Form an LLC?
A Limited Liability Company is a business structure formed under state statutes. It is a separate legal entity from its owners that are known as members. An LLC can be formed as either a single-member LLC or a multiple member LLC and either member-managed or manager-managed. The LLC is the formal business structure that is simplest to form and maintain. It offers some of the same benefits of a corporation without the costs and compliance complexity. Business owners that are looking for personal liability protection, tax flexibility, and management options may find that forming an LLC will be a great choice for their company.
Four Great Benefits of Forming an LLC
First, it is simple to operate. The LLC structure is the least complex and costly form of business to start and maintain from a state compliance perspective. The business registration paperwork to form an LLC is minimal as are the ongoing filing requirements.
Second, it provides Personal Liability Protection. Because an LLC is considered a separate legal entity from its members, its financial and legal responsibilities are also its own. If someone sues the business or the company cannot pay its debts, the LLC members are usually not held responsible. Their personal assets are at lower risk of being seized to pay legal damages or settle debt than they would be if the business were a sole proprietorship or partnership.
Third, Beneficial Tax Treatment Options. By default, an LLC is considered a disregarded entity for tax purposes. Income tax is applied in the same way as it is to sole proprietorships and partnerships with business income and losses passed through to its members’ tax returns and subject to members’ individual tax rates. An LLC has other tax treatment options, too. Members can elect for an LLC to be taxed as a corporation, with profits taxed at its corporate rate. Or members of an LLC can choose an S Corporation election, which allows for the LLC to have pass-through taxation but with the corporate benefit of a reduced self-employment tax burden because members only pay employment taxes on their income taken as salaries. Dividend income to the members is not subject to self-employment taxes.
Forth, Greater Management Flexibility. An LLC may be either member managed, or manager managed. In a member-managed LLC, the owners handle the day-to-day management of the business. In a manager-managed LLC, members appoint one or more managers to manage the company. In most states, an LLC can appoint members of the LLC to be managers or it can hire someone else to do the job. The manager of an LLC usually has the authority to make certain decisions and run the day-to-day operations of the company while members retain authority over more significant strategic matters.
How to Form an LLC.
First, File Articles of Organization with the State, obtain an Employer Identification Number, create an Operating Agreement, Obtain Business Licenses and Permits and start a business bank account.
Forming a Corporation
Forming a Corporation? There are many benefits of incorporating for a small business owner. Incorporating a business requires the preparation and filing of a Certificate of Incorporation with the Secretary of State. Once the corporation is established, it becomes its own separate legal entity and is subject to the laws governing corporations in the state of incorporation. Steps to Incorporate your business include, performing a name check, drafting Articles of Incorporation, submitting documents for filing, electing a Board of Directors, and issuing shares.
The main reason to incorporate or form an LLC is to minimize your personal liability. Once your business is incorporated either by forming an LLC or Corporation, it exists as a separate business entity. Essentially, you put a barrier separating your personal assets from anything in the business. There are other benefits too, such as the ability to minimize your personal liability and protect your personal assets, get more flexibility when it comes to taxes, increase the credibility of your small business, add a layer of privacy, start building your business credit and protect your business name and brand at the state level.
An S Corporation, which is sometimes referred to as a Sub-Chapter S Corporation, is different from a C Corporation in two important ways. First, although it is formed in the same manner as a C Corporation, the corporate entity makes an election with the IRS to be taxed as a pass-through entity under subchapter S of the Internal Revenue Code. This means that an S Corporation is not a separately taxable entity. The profits and losses are passed through and reported on the personal income tax returns of the shareholders, much like a partnership. Second, unlike a C Corporation, an S Corporation has limitations on ownership. A corporation can avoid double taxation by electing to be treated as an S Corporation. Generally, an S Corporation is exempt from federal income tax other than tax on certain capital gains and passive income.
On their tax returns, the S Corporation’s shareholders include their share of the corporation’s separately stated items of income, deduction, loss, and credit, and their share of non-separately stated income or loss.
In order to be qualified as an S Corporation, your corporation must be filed as a U.S. corporation, maintain only one class of stock, must not have more than 100 shareholders, must be comprised solely of shareholders who are individuals, estates or certain qualified trusts, who consent in writing to the S Corporation election and have a Social Security Number. The corporation must have a tax year ending on December 31. To apply for S Corporation status, your corporation must complete and file IRS Form 2553 with the Internal Revenue Service no more than two months and 15 days or 75 days from the date of incorporation in order for the election to take effect during the tax year the filing is made.
Forming a Sole Proprietorship
A sole proprietorship is the simplest business entity, with one person or a married couple as the sole owner and operator of the business. If you launch a new business and are the only owner, you are automatically a sole proprietorship under the law. There is no need to register a sole proprietorship with the state, though you might need local business licenses, sales tax or permits depending on your industry.
A Sole Proprietorship is easy to start with no corporate formalities or paperwork requirements. You can deduct most business losses on your personal tax return. Filing Taxes filing is simple with a Schedule C-Profit or Loss from Business to your personal income tax return. As the only owner, you are personally responsible for all the business’s debts and liabilities. There is no real separation between you and the business, so it is more difficult to get a business loan and raise money. It is harder to build business credit without a registered business entity.
Taxes are not automatically withheld from a sole proprietor’s income like they would be from an employee’s wages. Because taxes are not withheld, sole proprietors must pay self-employment tax and estimated taxes. Self-employment tax includes both the employer and employee portions of Social Security and Medicare taxes. Often, you will need to pay self-employment taxes quarterly with an estimated tax payment. Estimated taxes are like income taxes taken out of an employee’s paycheck. Sole proprietors must estimate the amount of income tax owed to the government and pay them quarterly.
Forming a Partnership
A partnership is a legal entity where two or more unmarried people run a business. Like a sole proprietorship, each partner owns a portion of the assets and liabilities of the business. The main difference is that a partnership relies on an agreement between the partners. This document, the partnership agreement, details ownership and responsibilities of the partners.
Starting a Partnership
Creating the partnership agreement is the most important step. It will lay out the relationship between the partners. For a general partnership this will shape many aspects of the business. Typical language in a partnership agreement include provisions for the business name because partners will often share business accounts and act in the name of the business, contributions because each partner’s stake in the formation and ongoing finances of the business must be clearly laid out, distributions because you need to determine how will profits be split between partners, ownership issues, decision making authority, handling disputes and other important considerations.
Partnerships keep the same tax benefits as sole proprietorships. The tax rate is based on income from the business as personal income and gets reported through a K-1. The term for this is pass through. The tax obligation passes through the business to the owners.
A nonprofit is created for charitable, educational, or other purposes. These purposes of the nonprofit cannot benefit the owners directly. This allows nonprofits to operate tax-free. Nonprofits are named for the Internal Revenue Code section they fall under and 501(c) is the most common.
Starting a Nonprofit
A nonprofit has the same initial paperwork that a corporation has, with one difference. Nonprofits have a mission statement that clearly defines the organization. The purpose of the nonprofit must be laid out clearly. The IRS recognizes several different sub-classes of nonprofits. Going beyond the scope of the mission can mean loss of tax-exempt status. Deciding who will be directors and creating articles of incorporation are also required. Tax-exempt status is not automatic and can be denied. Application for tax-exempt status must be made with both Federal and State authorities.
Nonprofits operate tax-free. All money above operating costs must be used to further the goals of the nonprofit. Surplus cannot be paid to the stakeholders. They can accept donations and grants. The tax benefits can flow through to donors who contribute money or time. Wages may be paid to employees at standard rates. Approval is both at the State and Federal (IRS) level. Five purposes are recognized for nonprofits such as charitable, religious, scientific, educational and literary. Even though a nonprofit is tax free, regular filings with the IRS are required with IRS Form 990. These are used to monitor the organization. Because loss of status has so many tax consequences, great care must be taken to keep records current and accurate. Dissolving a nonprofit is complicated. Nonprofits cannot be sold in the traditional sense. All assets must be transferred to another nonprofit or put toward the purpose of the organization. No funds can be directly distributed to the owners.
How to Form a Nonprofit Corporation
To form a nonprofit corporation, you first will need to file nonprofit articles of incorporation or a certificate of incorporation with the appropriate state agency, usually the secretary of state, along with payment of the required fee. File a separate application for 501(c)(3) tax-exempt status with the Internal Revenue Service.
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