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IRS Currently Not Collectible

August 22, 2014 by admin

Steven A. Leahy
IRS Currently Not Collectible

By Steven A. Leahy

There are six things you can do if you owe the IRS money. First, you can simply write the IRS a check for the full amount. For many, that is simply not a realistic option. Often, if the tax obligation is not too significant, borrowing money from another source (friends, family, bank loan, credit cards, etc.) may be a less costly alternative than an installment agreement with the IRS. Second, you can enter into an Installment Agreement; pay the IRS over time. Third, you can obtain an Offer-in-Compromise: A lump sum settlement for less than the tax owed. Fourth, you can be declared Currently Not Collectible; pay the IRS nothing (for a period of time). Fifth, you can file for protection under the bankruptcy code; Chapter 7, Chapter 13 or Chapter 11. And the last option – you can do nothing, and let the IRS do what they will to you, your family and your assets.

This article addresses the fourth option – IRS Currently Not Collectible (CNC). The IRS lists a number of reasons to report an account CNC. The reasons include, inability to locate the taxpayer, expiration of the statutory recovery period (statute of limitations), death of an individual (where the IRS can’t collect from the estate), defunct companies without assets, or the taxpayer is out of the country or in a combat zone. The most common reason for CNC status is the existence of a taxpayer hardship.

The IRS may place a taxpayer in CNC status based on a hardship – when the IRS determines that the taxpayer can’t pay their tax obligation AND pay reasonable living expenses. The first requirement for a hardship CNC is compliance. In most cases, the taxpayer must have filed all tax returns, made all required estimated tax payments for the current year and made all required federal tax deposits for the current quarter if the taxpayer is a business owner with employees. The taxpayer must remain in compliance during consideration and, should a hardship CNC be found, thereafter.

In order to demonstrate a hardship, a financial analysis, with detailed financial information, must be completed to determine the taxpayer’s assets and equity, income and expenses. The investigation into the taxpayer’s financial condition begins by completing Form 433–A, Collection Information Statement for Wage Earners and Self-Employed Individuals or Form 433–B, Collection Information Statement for Businesses, and providing all the necessary documents to substantiate the numbers.

The level of scrutiny depends on the tax obligation – the greater the tax bill, the greater the scrutiny. For example, if the unpaid tax balance is large, the IRS will review the taxpayer’s credit report, motor vehicle records and real estate records to determine if there are any additional sources for collection, in addition to the 433 and supporting documents. Generally, an IRS manager must review the IRS Currently Not Collectible recommendations paperwork and approve granting the CNC status.

Collection actions stop once a taxpayer’s account is placed in IRS Currently Not Collectible, including bank levies, wage garnishments and collection letters. The problem with CNC is that interest and penalties continue to accrue even though IRS collection activity has been suspended. In addition, if the balance is greater than $10,000.00, the IRS may still issue a Notice of Federal Tax Lien against the taxpayer (although the taxpayer can still appeal that action).

The good part about CNC is that the Collection Statute Expiration Date (CSED) is not tolled while the taxpayer’s account in a hardship CNC status. It is possible for a taxpayer to continue in hardship CNC status until the CSED passes. Once the CSED passes, the IRS cannot collect on that IRS obligation. Hardship CNC cases, however, can be reactivated if it appears there is a change in the taxpayer’s ability to pay indicating collectibility. And, the IRS may ask the taxpayer to reestablish CNC hardship status periodically.

So, if you owe the IRS and are unable to pay the full tax obligation immediately, you may be eligible for your account to be placed in a Hardship CNC status. Before you do anything, you should give me a call. We can discuss your all your options. Opem Tax Resolutions & The Law Office of Steven A. Leahy, PC (312) 664-6649. Call NOW to set up your FREE Consultation.

Filed Under: Uncategorized Tagged With: “Tax Relief”, back taxes, Chicago Tax Help, IRS Help, IRS Help Chicago, IRS Levy, IRS Lien, irs non-collectible status, irs options, Offer in Compromise IRS, Tax Debts, Tax Solution

IRS Installment Agreements

August 7, 2014 by admin

Steven A. Leahy
IRS Installment Agreements

By Steven A. Leahy

There are six things you can do if you owe the IRS money. First, you can simply write the IRS a check for the full amount. For many, that is simply not a realistic option. Often, if the tax obligation is not too significant, borrowing money from another source (friends, family, bank loan, credit cards, etc.) may be a less costly alternative than an installment agreement with the IRS. Second, you can enter into an IRS Installment Agreement; pay the IRS over time. Third, you can obtain an Offer-in-Compromise: A lump sum settlement for less than the tax owed. Fourth, you can be declared Currently Not Collectible; pay the IRS nothing for a time. Fifth, you can file for protection under the bankruptcy code; Chapter 7, Chapter 13 or Chapter 11. And the last option – you can do nothing, and let the IRS do what they will to you, your family and your assets.

This article addresses the second option – IRS Installment Agreements – for personal income taxes. IRS Installment Agreements allow taxpayers to pay the IRS in monthly installments rather than paying the IRS in full immediately. There are several different kinds of Installment Agreements: Guaranteed, Streamline, Partial and Full Pay. Each has unique characteristics. In most cases, just proposing an installment agreement will stop other IRS collection efforts (e.g. wage garnishment, levies). If an IRS Installment Agreement is rejected, the IRS may consider a revised proposal, or the taxpayer may appeal the rejection.

The Guaranteed Installment Agreement is designed for taxpayers with a tax obligation of less than $10,000.00 (excluding penalties and interest). If the taxpayer has also timely filed all income tax returns, paid any tax due for the last five years, has not had an installment in the last five years, and agrees to pay the amount due in 3 years, an installment agreement is virtually guaranteed, even if the taxpayer has the ability to pay the tax liability in full immediately.

The Streamlined Installment Agreement (SIA) is designed for individual taxpayers with a tax obligation not greater than $50,000.00. Recently, the IRS instituted the “Fresh Start” initiative. Fresh Start provisions changed the parameters for a SIA in several important ways. First, the IRS raised the threshold from $25,000.00 to $50,000.00 in tax liability. Next, under the new streamlined provisions, taxpayers can stretch repayment of their tax obligation over 72 months, rather than the old maximum of 60 months. Both of these changes have had a great impact for taxpayers.

The best part of a SIA is it is streamlined, meaning taxpayers do not have to provide financial data to the IRS in order to get an installment agreement. This makes the process quick and less intrusive.

A Partial Installment Agreement (PIA) is designed for taxpayers who are unable to pay the full amount they owe to the IRS. Taxpayers must reveal their financial circumstances, in detail, for a PIA. Negotiating a PIA with the IRS can be tricky – not something I would recommend taxpayers do by themselves. IRS standards and procedures are well known to the IRS, but not to taxpayers. The IRS uses this advantage to get the taxpayers to pay more per month than they may be able to afford. If this happens, a default on the PIA is just a matter of time. After a taxpayer defaults, they will find themselves back in collections, and facing levies and garnishments again.

The final kind of Installment Agreement (IA) is an agreement that pays the full amount due over time. If a taxpayer owes more than $50,000.00, the IRS will conduct a complete investigation of the taxpayer’s finances. They look at income, expenses, and assets, with supporting documents. Again, the amount of a taxpayer’s monthly payment will determine the success or failure of the IA. So, it is imperative to get the best IA payment possible, something best left to professionals.

So, if you owe the IRS and are unable to pay the full tax obligation immediately, you should consider an IRS Installment Agreement. Before you do anything, you should give me a call. We can discuss your options. Opem Tax Resolutions & The Law Office of Steven A. Leahy, PC (312) 664-6649. Call NOW to set up your FREE Consultation.

Filed Under: Uncategorized Tagged With: “Tax Relief Chicago”, back taxes, Chicago Tax Help, Help With IRS, IRS Installment Agreement, Tax Debts, Tax Solution

Chicago – IRS Solutions

May 21, 2013 by admin

Steven A. Leahy

Chicago: IRS Solutions

Chicago: IRS Solutions – One Way to Get Out of IRS Debt

There are 6 different ways to eliminate IRS tax debt.

Let’s look at one of the easiest….

Pay the bill.

Now before you think I’m being overly simplistic, this is really an option for many people.

Let me explain.

You may want to pay the bill with a credit card.

Credit card debt is usually better than IRS debt.

The IRS actually accepts Visa, Mastercard & American Express for many debts owed to them. Think of it this way…a credit card company has nowhere near the power of the IRS to collect their money…

Not only can the IRS take your wages, but they can also take things like your real estate, Social Security, 401(k)’s, IRA’s, car, boat, house, accounts receivable, cash loan value of your life insurance, or commissions…to name just a few.

The IRS can also put a lien on your personal and investment properties, making it difficult to sell your house, destroys your credit rating and makes it difficult to refinance or get a home equity loan.

Of course, the “big hammer” of the IRS is that they can actually send you to prison for not paying your taxes.

The credit card companies have power, but not near as much as the IRS. If you don’t have enough credit to pay off your IRS debt then you should know that there are other options.

Chicago IRS Solutions. If you are searching for IRS Solutions to your tax problems, or if you have ANY questions about IRS problems, we can help. call Opem Tax Resolution – The Law Office of Steven A. Leahy, PC (312) 664-6649. Call Now to schedule your FREE 1 hour Consultation!

Filed Under: Uncategorized Tagged With: “Offer in Compromise”, “Owe Taxes”, “Tax Options”, “Tax Relief Chicago”, back taxes, Chicago Tax Help, currently non collectible, IRS Help, IRS Help Chicago, IRS Levy, IRS Lien, irs non-collectible status, irs options, IRS Options Help, IRS problem, IRS Solutions, IRS Tax Debt, irs tax penalty, IRS Tax Problem, Offer in Compromise IRS, Offer in compromise Settlement, Relief, steven a. leahy, Tax, tax attorney chicago, Tax Debts, Tax Help, tax options Chicago, Tax Problem Help, tax resolution, tax resolution chicago, Tax Solution

Chicago – IRS and Divorce

May 15, 2013 by admin

Steven A. Leahy

Chicago: IRS and Divorce

Chicago: IRS and Divorce
Could the IRS Make You Get Divorced? In Chicago and need IRS Relief for Tax Debt?

Numerous studies have shown that the money problems are the #1 source of arguments in marriage.

Money problems caused by credit debt, loss of a job, unforeseen expenses – you name it…it’s all stressful on a marriage.

But if you toss an IRS problem into the mix, you may have a recipe for disaster. The IRS has more far-reaching power than any collection agency could ever have.

No other entity has the power to dip into your bank account, garnish your wages, seize your property, put a lien on your house…and possibly put you in jail.

So if money problems cause arguments, IRS problems can cause absolute fallout.

Of course, if divorce follows as a result, it introduces a whole host of other problems emotionally and financially.

Not to mention the damaging effects that marital problems and divorce has on your children… So the IRS can’t cause a divorce, but they sure can contribute to one.

You owe it to yourself, your spouse and your children to put and end to this madness and get on with your life.

Chicago IRS and Divorce. If you have questions about the IRS and divorce, or if you have ANY questions about IRS problems, we can help. call Opem Tax Resolution – The Law Office of Steven A. Leahy, PC (312) 664-6649. Call Now to schedule your FREE 1 hour Consultation!

Filed Under: Uncategorized Tagged With: “non collectible”, “Offer in Compromise”, “Tax Relief Chicago”, “Tax Relief”, back taxes, Chicago Tax Help, currently non collectible, Help With IRS, IRS Help, IRS Help Chicago, IRS Help IL, IRS Levy, IRS Lien, irs non-collectible status, tax attorney chicago, Tax Debt Help, Tax Debts, Tax Help, Tax Help Chicago, Tax Levies, Tax Levy, tax options Chicago, Tax Problem Help, tax resolution, tax resolution chicago, Tax Return, Tax Solution, Tax-Consultants, TaxHelp

Chicago: IRS Tax Help

April 29, 2013 by admin

Steven A. Leahy

Chicago: IRS Tax Help

Chicago: IRS Tax Help
In the Chicago area and owe taxes? You may not even know you have an IRS tax lien until it’s too late.

The IRS uses liens to get people to pay the taxes owed. It’s one of the many tools in their arsenal and for many people it’s one of the worst penalties the IRS can inflict. It does silent damage to your life and your credit before you figure it out.

Simply stated, a lien is a security held against your personal and/or investment property by the IRS. And it can make your life miserable.

If the IRS places a claim on your property as a tax lien,it shows up on your credit report and can greatly damage your credit score.

The worst part is that you may not even be aware of the lien until you go apply for a credit card, car loan, home equity loan or to refinance. By that point lenders are hesitant to loan you any money.

Plus, a tax lien may make it very difficult to sell your house. A buyer will be reluctant to buy since the lien comes with the property and becomes the buyer’s problem if you don’t take care of it.

If you’ve had a lien placed on your property already, or if you’ve been served a Notice of Federal Tax Lien – you know that trouble’s just around the corner. We can help. call Opem Tax Resolution – The Law Office of Steven A. Leahy, PC (312) 664-6649. Call Now to schedule your FREE 1 hour Consultation!

Filed Under: Uncategorized Tagged With: “non collectible”, “Tax Relief Chicago”, “Tax Relief”, back taxes, Chicago Tax Help, currently non collectible, Help With IRS, IRS Help, IRS Help Chicago, IRS Help IL, IRS Levy, IRS Lien, irs non-collectible status, irs options, IRS Options Help, IRS problem, IRS Tax Debt, irs tax penalty, IRS Tax Problem, Offer in Compromise IRS, Relief, steven a. leahy, steven leahy, Tax Debt Help, Tax Debts, Tax Levies, Tax Levy, tax options Chicago, Tax Solution, TaxHelp

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