Archive for the ‘Collections’ Category
Friday, April 15th, 2011
The IRS issued a press release advising taxpayers of payment options when you file your income tax return. The release is IR 2011-42. I have placed it in the blog below. The most important thing for you to know is if you owe taxes but you cannot pay the full amount file your tax return and make a payment. Fill out and attach to your return Form 9465 — Installment Agreement Request. The IRS will contact you to work out a payment plan. Read the information below.
Remember, I am a tax attorney having worked in Office of Chief Counsel, IRS. If you have questions or need help with the IRS, just let me know.
Bill Lowrance
Lowrance Law LLC
McLean, VA
IRS reminds taxpayers with a balance due that there are several payment options available [IR 2011-42]: Taxpayers who have a balance due when they file their 2010 federal individual income tax returns have several payment options.
Payments can be made by electronic funds withdrawal, credit or debit card, the Electronic Federal Tax Payment System, or check or money order. According to IRS, some taxpayers who itemize their deductions may be eligible to claim as a miscellaneous itemized deduction the convenience fee charged to pay individual income taxes by credit or debit card.
Along with a check or money order, a taxpayer must include Form 1040-V, Payment Voucher. If a return has already been submitted but additional payment is due, a check or money order should be mailed to IRS with Form 1040-V. “For members of the military and others serving in combat zones, the filing and payment deadline is normally postponed until at least 180 days after the service member leaves the combat zone,” IRS said. “If you are eligible, you get the extra time without having to ask for it,” IRS added.
The agency advises taxpayers with a balance due to pay as much as possible by April 18 to avoid penalties and interest. Those who cannot pay in full have several options to consider. The first is an installment agreement. In most cases, this can be done in several minutes by using the IRS website, the agency said. The second payment option is an Offer in Compromise, which is an agreement between a taxpayer and IRS that settles the taxpayer’s tax liabilities for less than the full amount owed. It is subject to acceptance based on legal requirements. The news release can be viewed on the IRS website.
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Tags: collect tax, failure to pay, income tax, IRS, Office of Chief Counsel IRS, Tax Attorney, Tax Authorities, tax collection, tax law, tax news
Posted in Attorney, Collections, Controversy, IRS, IRS Audits, Tax Liens, Tax Litigation, Tax Problems, income tax, tax news, tax return | No Comments »
Wednesday, April 13th, 2011
The IRS just sent out IRS Tax Tip 2011-73. The notice gives you the IRS view of what to do if you receive a letter from the IRS. Read this over and do not panic. If you need assistance with the IRS, please contact me at 703 506 1600. I handle audits, examinations and litigation of IRS matters
Eight Things to Know If You Receive an IRS Notice
the Internal Revenue Service sends millions of letters and notices to taxpayers
for a variety of reasons. Here are eight things to know about IRS notices – just
in case one shows up in your mailbox.
Don’t panic. Many of these letters can be dealt with simply and painlessly.
There are a number of reasons why the IRS might send you a notice. Notices may request payment of taxes, notify you of changes to your account, or request additional information. The notice you receive normally covers a very specific issue about your account or tax return.
Each letter and notice offers specific instructions on what you are asked to do to satisfy the inquiry.
If you receive a correction notice, you should review the correspondence and compare it with the information on your return. If you agree with the correction to your account, then usually no reply is necessary unless a payment is due or the notice directs otherwise. If you do not agree with the correction the IRS made, it is important that you respond as requested. You should send a written explanation of why you disagree and include any documents and information you want the IRS to consider, along with the bottom tear-off portion of the notice. Mail the information to the IRS address shown in the upper left-hand corner of the notice. Allow at least 30 days for a response.
Most correspondence can be handled without calling or visiting an IRS office. However, if you have questions, call the telephone number in the upper right-hand corner of the notice. Have a copy of your tax return and the correspondence available when you call to help us respond to your inquiry. It’s important that you keep copies of any correspondence with your records.
For more information about IRS notices and bills, see Publication 594, The IRS Collection Process. Information about penalties and interest is available in Publication 17, Your Federal Income Tax (For Individuals). Both publications are available at the IRS website, www.irs.gov.
Tags: collect tax, income tax, IRS, Tax Attorney, tax collection, Tax Litigation, Tax Problems
Posted in Attorney, Collections, Controversy, IRS, IRS Audits, Tax Attorney, Tax Liens, Tax Litigation, Tax Problems, income tax, tax deductions, tax news | No Comments »
Thursday, May 21st, 2009
The IRS is planning more employment tax audits and examinations over the next three years. A national research project is underway right now and the IRS has announced that it will conduct detailed employment tax examinations of certain taxpayers. The selection process for taxpayers has begun and the program will last for three years.
The IRS estimates there will be over 3000 examinations and audits. Although the IRS may look at any line on an employment tax return during the examination, it will primarily focus on the following issues: (1) worker classification (employee vs. independent contractor), (2) fringe benefits, (3) officer’s compensation, and (4) reimbursed expenses.
Often the IRS will receive Form SS 8 from a worker who wants a determination of whether he/she is an independent contractor or employee. The IRS will collect information from the worker and from the company involved. The IRS will either conduct a compliance check, make a determination based on the information collected or conduct a detailed employment tax examinations. If the IRS determines the worker is and was an employee, there are serious tax implications for the employer. It could be costly for the employer in terms of back taxes.
There are several ways to challenge the IRS’ decision about whether the worker is an independent contractor or an employee. It is best to consult a tax professional if you have been contacted about an employment tax matter.
Bill Lowrance
Lowrance Law LLC
McLean, VA
703 506 1600
Tags: collect tax, Employee, employment tax, Independent Contractor, tax collection, Tax Problems
Posted in Attorney, Collections, Controversy, Employee, Independent Contractor, Tax Attorney, Tax Problems, employment tax | No Comments »
Tuesday, January 6th, 2009
The Treasury Inspector General for Tax Administration (TIGTA) is the only government entity that conducts internal audits the IRS. Well, now you can read the most recent interesting report that covers their audit April 1, 2008 through September 30, 2008. The report is TIGTA’s semiannual report to Congress.
There are some “blockbuster” (technical tax term) statements and recommendations in the report.
TIGTA says that IRS must focus on closing the Tax Gap noting that IRS does not consistantly assess penalties or penalize taxpayers for making false statements when filing returns. TIGTA recommends that IRS expand its enforcement efforts. As I have predicted before, along with other tax experts, in the future IRS will be increasing enforcement efforts. In fact, Chief Counsel, IRS, is looking for more attorneys, see Click Here
TIGTA said: “Now, more than ever, the IRS must focus efforts to close the Tax Gap – the difference between the amount of tax that taxpayers should pay and the amount that is paid voluntarily and on time. In audits conducted over this reporting period, TIGTA found that the IRS has neglected to consistently assess penalties on non-compliant businesses and individuals. Additionally, TIGTA noted that the IRS generally does not penalize taxpayers for making false statements when filing official tax forms. The IRS must aggressively address the lack of taxpayer compliance and hold those in violation accountable for their actions.”
Read the whole report: Click Here
Bill Lowrance
Tax Attorney
Tags: cirme, collect tax, failure to pay, income tax, Office of Chief Counsel IRS, Tax, tax collection, tax crimes, tax evasion
Posted in Attorney, Collections, Controversy, IRS, IRS Audits, Tax Attorney, Tax Crime, Tax Liens, Tax Litigation, Tax Problems, Tax Research, Uncategorized, income tax | No Comments »
Thursday, October 30th, 2008
IRS has a great Small Business web page at IRS Business. Check out starting, operating or closing a business at Start/Close Business. Also, check the latest business news that gives small business owners information about the latest mileage rates, worker classification (employee vs. independent contractor) and other announcements See Business News. Get the IRS information on business expenses at Business Expenses.
But as always, remember this is IRS general information. For a more in-depth research and analysis check with your tax attorney or accountant.
Bill Lowrance
Tags: IRS, small businenss, tax news
Posted in Attorney, Collections, Controversy, IRS, IRS Audits, Tax Research | No Comments »
Wednesday, October 29th, 2008
Most businesses withhold payroll taxes from employees’ salary checks. Taxes withheld are income, social security and medicare payments. Other withholding items are for State taxes, retirement funds and unemployment funds.
Right now in the hard economic times, business owners may be tempted to use the money they deduct from their employee’s wages for other expenses. The only problems is that the deductions are not the employer’s funds. The funds should be deposited into special accounts for payment to the proper taxing authorities.
If the employer does not make timely deposits, there will be penalties to pay. In addition, if the business goes down, the owner or “responsible person” in the business may assessed the missed deposits under IRC section 6672–the 100% penalty provision. The “responsible person,” usually the business owner will personally owe the money not properly withheld and paid over to the IRS.
If you, as a business owner, are subject to the 100% penalty assessment, contact your tax attorney right away.
See the IRS publication Click Here
Bill Lowrance
Tags: 100% penalty, business owner, employment tax, failure to pay, IRS, tax collection
Posted in Attorney, Collections, Controversy, IRS, IRS Audits, Tax Attorney, Tax Problems | No Comments »
Monday, October 20th, 2008
 You may not think international tax law applies to you, but it may. Do you have a bank account outside of the United States? If so, you are supposed to report it on your tax return. There is a check box on the tax return to report any foreign bank accounts. If you do not report your account, the IRS may come calling on you.
I worked as an attorney in the International Division of Office of Chief Counsel, IRS, for many years. As such, I assisted the IRS in gathering information from many foreign countries including most of the the Caribbean jurisdictions. So, there is a process for the IRS to collect foreign bank account and business/financial information.
The IRS has many ways to find out about your foreign activities. Many foreign countries have tax treaties with the US. All the treaties have an “exchange of information” section. The taxing authority of each country often spontaneously furnishes business and financial information to the IRS. Well, the IRS takes it from there. In addition, the IRS has Tax Information Exchange Agreements with many foreign jurisdictions. Offshore financial centers like the Cayman Islands, Bahamas, Bermuda and many other counties signed these agreements. Basically, the IRS can request business, banking or financial information from the foreign tax authority. The foreign tax authority will get the information and give it to the IRS.
So, do not think your financial or business information is out of the IRS’ grasp just because the information is in another country.
More on this interesting subject will be in another post soon. Keep coming back and read about it.
Bill Lowrance
Tags: foreign bank accounts, income tax, IRS, tax information exchange agreements, tax treaties
Posted in Collections, Controversy, IRS, IRS Audits, Offshore Accounts, Tax Attorney, Tax Crime, Tax Litigation, Tax Problems | No Comments »
Saturday, October 11th, 2008
 According to an Associated Press article, many states are increasing tax enforcement and collections efforts as state revenues decline in our present economic condition.
States like New York, California, Massachusetts and Illinois are ”beefing up” tax enforcement and collections. You can believe Virginia will, and is, doing the same thing. Sometime ago Virginia contracted with a collection agency in Livermore, CA, to collect past due taxes. This collection agency, Diversied Collection Services, Inc. gets taxpayer information from the Virginia Department of Tax. The agency starts calling and writing the taxpayer demanding payments. Check out the Virginia Department of Tax Here
I spoke to a person identifying herself as Fay Miller at Diversied the other day. I called on behalf of a client who, in the past, did not have money to pay taxes. Well, Ms. Miller demanded full payment of the client’s tax bill. Of course, this was done without the Virginia Department of Tax contacting me as the representative of my client. But, that is another story I will talk about later.
States are facing budget and revenue problems. The taxing authorities will be increasing enforcemnt efforts against companies, small businesses and individuals. Now that may mean turning over collection to collection agencies. I am appalled that the states, especially Virginia, contracts with a collection agency in California to contact Virginia taxpayers using the famous and infamous collection agency techniques.
I hope to find out more information about the Virginia contract with this collection agency and the process used to collect past taxes. Of course, everyone should file returns and pay taxes on time. The facts are, however, that some people have hard times and cannot pay the tax due.
Anyway read the entire AP story Click Here
Bill Lowrance
Your Virginia Tax Attorney www.lowrancelaw.com
Tags: collect tax, Collection Agencies, States, Tax Authorities, Virginia Department of Tax
Posted in Collections, Controversy, IRS, Tax Attorney, Tax Problems | No Comments »
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