Penalty abatement is a form of tax debt relief you can avail to significantly reduce the total tax you owe to the IRS.
What is Penalty Abatement?
If you have a tax debt, the IRS will calculate penalties and interest on the amount owed. The penalties include a 'failure to file' penalty if you have failed to file your returns on time (including extensions), a 'failure to pay' penalty if the tax amount has not been paid in full and which is calculated on the basis of the amount you owe. These two penalties are charged on a monthly basis for the entire period until resolution. Further the IRS charges a daily interest on the tax amount you owe. All in all, the each penalty may contribute up to 25% of your total tax bill.
If your failure to pay taxes has been due to financial difficulties, such difficulties are further compounded by the penalties, which continuously keep adding to the total tax debt. So penalty abatement is an option you should definitely consider to achieve some degree of tax debt relief. As professional enrolled agent, Mike Habib can guide you in this matter if you do not feel confident enough to handle it on your own.
Amongst several factors that strike fear deep in the hearts of grown American men and women is receiving the IRS audit summons. Even if you have submitted your returns honestly and accurately, it is possible that your accounts may be subjected to an IRS audit. Though you are entitled to know why you are being audited, once you have received the audit communications from the IRS, they just can't be wished away. You just have to buck up and handle the IRS audit to the satisfaction of the IRS and get yourself off the hook.
Running a business, managing a company is not a child's play. Apart from being a good CEO or the Head of the Company, there are certain important things you have to figure out and reign in early when you first start your own business or running a company as you need to take care of your employees as well as their salaries thereof. Payroll taxes are the most important of them all. You have to know how to calculate and pay 941 payroll taxes before you set out to hire employees.
Seeking help with tax debt should be your priority if you find yourself unable to discharge your tax obligations to IRS. Tax debt is a serious problem that can affect you emotionally, financially and socially. The emotional aspect refers to the constant anxiety and waiting for the inevitable IRS notices. Of course, if the IRS resorts to some of its extreme collection techniques like placing a lien on your property or levy wage garnishment, the social and financial implications become severe.
In the present times, it is a common occurrence to find ourselves buried neck deep in the sands of unpaid tax debts although in today's economy it is not unusual to have tax debts. For individual and business taxpayers in Chicago-Aurora-Elgin-Joliet-Waukegan, IL-IN Metro it is often stated and acknowledged that owing money towards IRS is tantamount to owing money towards mob. Not surprising though if you already know how scary and unrelenting IRS tax officials usually are. The very thought of the IRS hounding you relentlessly is enough to drive sane people insane.
Enforcement Revenue Collected by the IRS
(Dollars in Billions)
FY 2001 FY 2002 FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 FY 2009 FY 2010 FY 2011
Collection $24.3 $24.4 $24.8 $25.7 $26.6 $28.2 $31.8 $31.1 $26.9 $29.1 $31.10
Examination $5.6 $5.7 $8.8 $12.5 $13.8 $13.0 $15.2 $15.8 $12.6 $16.9 $12.40
Appeals $2.3 $2.2 $1.9 $2.2 $3.9 $4.3 $8.3 $4.8 $4.8 $6.7 $6.50
Document Matching $1.6 $1.8 $2.2 $2.7 $3.1 $3.3 $3.9 $4.7 $4.6 $4.9 $5.20
Total: $33.8 $34.1 $37.6 $43.1 $47.3 $48.7 $59.2 $56.4 $48.9 $57.6 $55.20
IRS continues to increase enforcement effort. Get tax relief today by calling 1-877-788-2937.
Unpaid back taxes can attract serious penalty from the IRS, and getting professional tax help is the best option to resolve this issue. Individual and business taxpayers in San Diego, CA metro area of greater San Diego, Carlsbad, San Marcos and National City with back taxes accumulate when you have not paid your federal or state taxes for a variety of reasons. You may not have been sure of your tax liability or could not afford to pay the tax or simply just did not get around to filing your tax return. Whatever the reason, the IRS is sure to catch up with you soon and enforce their aggressive tax collection techniques.
Businesses and individuals in New York metro such as Manhattan, The Bronx, Brooklyn, Queens, and Staten Island often require professional IRS help to resolve tax related issues. The tax laws, state and or federal tend to be complicated and you rarely have a very good understanding of the laws as they pertain to you or your tax matters. Unfortunately, the IRS has no sympathy for your lack of knowledge and will not accept that as a valid excuse.
What is an IRS Tax Settlement?
An IRS tax settlement is an agreement between you and the IRS regarding what you owe them. It is a negotiation where you pay an amount that is less than you originally owed. The IRS is often willing to take a deal rather than to have to continue to fight to get funds owed to them. This is especially true if it isn't possible for the person or business to pay what is owed.
An IRS tax settlement also involves various penalties, interest, and fines being removed from what is owed. When all of that is added on, it can increase the overall debt dramatically. Many people don't realize that they can offer an IRS tax settlement and get out from under that stressful situation.
While they do prefer to get the full amount of money that is due to them, they are realistic about it. They don't want to be hassling people or businesses for money. They also know that you can't get blood out of a turnip. Don't ignore the IRS when they tell you that you owe them money. Instead, see what you can do through a tax settlement offer.
What is an IRS Tax Audit and Examination?
An IRS tax audit and examination isn't fun because they will be evaluating all aspects of what you have reported on your tax returns. They have the right to do this for individuals as well as for businesses. Sometimes, there is something on a given tax return that causes them to see red flags. Others are selected at random to be inspected from top to bottom.
It can be very unnerving for an IRS tax audit and examination to occur. They will go through your personal or business tax information. They will do it with a fine toothed comb too, searching for information to verify that the tax information reported is accurate. If everything is accurate they will finish up and be on their way.
Some people get lucky and discover they are entitled to some money from the IRS. However, that isn't always the way it works. There are more people that find they now owe the IRS more money than they thought.
What is a Bank Levy?
A bank levy is a very serious incident and one that can cause great distress for you financially. This involves the IRS freezing your bank account. They can take everything that is in it. They don't care if you have $5, $500, or $5,000. They don't have to tell you that they are going to do it either.
The information for the bank levy goes right to the financial institution. As a result, you may write checks and then you don't have any money to cover them. You may need to make a cash withdrawal and find out that you can't access any of the money you thought you had in that account.
If you have your own business, there is plenty going on all the time. In addition to taking care of your customers, you have to take care of your employees. Payroll can be very difficult with the many scenarios, and that can lead to an employment tax problem. Don't feel like you are alone though as 941 payroll tax problems are extremely common when it comes to the IRS and what they have to look into.
Want to reduce your unpaid IRS debt with an Offer in Compromise?
Many taxpayers with back taxes contact us on a daily basis to see if qualifying for an offer in compromise settlement can save them thousands of dollars in taxes, penalties and interest. The widely known offer in compromise settlement is an agreement between the taxpayer and the IRS to settle the taxpayer's full tax liabilities for possibly less than the full amount owed. Each taxpayer's, RCP, reasonable collection potential, is different and an offer will not be accepted if the IRS believes that the full unpaid tax liability can be paid in full as a lump sum or through a payment agreement.
2011 year-end tax planning strategies for individual and business taxpayers.
Mike Habib, EA Introduces Tax Planning & Tax Coaching Service
Whittier, CA, November 04, 2011 --(PR.com)-- Mike Habib, EA is pleased to announce he has added tax planning and tax coaching to his firm's services. The new service gives individual and business taxpayers a plain-English plan for beating the IRS - legally by taking advantage to every tax break they deserve.
"Other traditional tax planning firms' crunches numbers to illustrate 'what-if' scenarios based on future assumptions," said Mr. Habib. It gives clients dry numbers, in more detail than they need or want. But clients don't want numbers. Clients want savings.