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Tag Archive for Lien

How Can You Remove An IRS Tax Lien?

What is a Tax Lien?

The Internal Revenue Service frequently files tax liens (federal) against taxpayers with unpaid tax obligations. Federal tax liens are documents that are filed with county governments (often where the relevant taxpayer lives or conducts business) informing the public that the taxpayer owes money to the IRS.

Liens are attached to a taxpayer’s property (both personal property and business property). This means that the IRS will have first dibs on the proceeds of your property such as your home or car. The tax lien can also impair your crediting rating.

However, the good news is that you can remove the IRS lien by following these strategies.

Read more

Liens and Levies: Keeping Your Clients Options Open – Part 3

When is a Levy Issued?

Technically, there is no legal difference between a levy and a seizure. The IRS uses these terms to specify who was the custody of the property that was taken, either a third party or the taxpayer himself. For the purpose of this discussion we will term property taken from a third party as a levy and property taken directly from the taxpayer as a seizure.

As with the NFTL, the IRS can not levy until the three requirements (notice, demand, and notice of intent to levy) have been issued. These notifications can occur after the NFTL process or in conjunction with it, depending on the specific circumstances.

The Letter 1058, Final Notice of Intent to Levy and Notice of Your Right to a Hearing, must Read more

Liens and Levies: Keeping Your Clients Options Open – Part 2

The Enforcement Process

Enforced collections is a process that starts after requests for voluntary compliance to the taxpayer fail. The process is pretty simple and straightforward:

• A tax return is filed (or not)
• The tax liability is paid (or not)
• The IRS officially assesses the tax (ASED/CSED tolled)
• The tax liability is paid (or not) upon demand
• Liens is placed on the account
• Notice of Federal Tax Lien (NFTL) is issued to taxpayer Read more

It’s Not The End of The World! Statutory Notice of Deficiency: Part 6

Taxpayer’s Other Payment Options

Determining other payment options for your client takes serious research, compilation of records and information, and then sitting the client down and having a coming to reality meeting with them. Of course, you already did all of this when reviewing for the case, but let’s do a quick review of the options and the statute tolling events:

1. The Fresh Start Initiative – Full Pay Installment Agreement or Partial Pay Installment Agreement
2. Offer in Compromise
3. Letting the CSED run and letting the levy be foreclosed Read more

It’s Not The End of The World! Statutory Notice of Deficiency: Part 5

Collection Appeal Program (CAP) and Collection Due Process (CDP)

Assuming we have not been able to get involved before the case goes to collections, we start on a different path. There are very specific things the IRS must do, in order, on the correct time line, and document to be able to make collections against a taxpayer.

Again, assuming we are brought on board before time lines expire, the CAP is our first avenue of protest at this point. The CAP can be requested via Form 9423 before or after the filing of a NFTL, levy, or seizure, or upon rejection or termination of an installment agreement.

Once Appeals makes a decision regarding your case on a CAP hearing, that decision is Read more

It’s Not The End of The World! Statutory Notice of Deficiency: Part 4

Judicial Review On A SNOD

The taxpayer has the option, as long as they are filing in a timely manner, to Petition the Tax Court when they receive a SNOD. Be sure the client understands that there is a filing fee, currently $60, and that they must either represent themselves or have a representative who is admitted to practice before the Court. For a non-attorney that means passing the U.S. Tax Court Practitioners Exam, the highest accreditation awarded to a Tax Professional. Let’s delve a little more deeply into the petition process.

The U.S. Tax Court allows taxpayers to file a Petition in the following cases under the “Small Cases” provision: Read more

It’s Not The End of The World! Statutory Notice of Deficiency: Part 3

Audit Reconsideration

Audit Reconsideration is allowed when you disagree with the results of only two specific events:

1. The assessment of tax liability by the IRS because of an audit of their filed return or
2. The assessment of a tax liability by the IRS because they have filed an SFR for the taxpayer.

This will usually occur when the case is still in the Examinations Division and is a much more informal version of a CAP. The IRS considers the Audit Reconsideration when there is information that was not considered in the original assessment. Representatives Read more

It’s Not The End of The World! Statutory Notice of Deficiency: Part 2

Client Receives “The Letter”

Best case scenario; we see the client as soon as that first CP2000 letter arrives at their door. Unfortunately, many times we don’t see a client until they have actually received the SNOD. This puts us at the disadvantage as some of the taxpayers time lines have already been blown by this point.

A quick review of the basics of any representation contact:

1. Engagement letters for specific situations (i.e consultation only, representation, etc)
2. Review of all IRS correspondence, taxpayer’s return and documentation, time lines in play and IRS transcripts. Read more

It’s Not The End of The World! Statutory Notice of Deficiency: Part 1

Your client calls you in a panic because they have just received a letter from the IRS and it says they owe money and talks about having to go to Tax Court! For most of us this is an everyday occurrence, however, for the client, it can be panic inducing. At the other extreme is the client who just ignores the letters until the certified letter comes talking about liens and levies, but that’s another blog post entirely.

The IRS even has a Tax Tip titled: Eight Tips for Taxpayers Who Receive an IRS Notice. Tip #1 is Don’t panic! Of course, none of the other tips include the advice to consult a tax professional, but that’s what we’re here for.

Once your client receives a Statutory Notice of Deficiency (SNOD) the clock is running and Read more