Tax Relief Blog

National Taxpayer Advocate Submits Mid-Year Report to Congress; Identifies Priority Challenges and Issues for Upcoming Year

WASHINGTON — National Taxpayer Advocate Nina E. Olson today released a report to Congress that identifies the priority issues the Taxpayer Advocate Service (TAS) will address during the coming fiscal year. The report expresses concern about the adequacy of IRS taxpayer service, particularly as the IRS begins to implement health care reform, about new information reporting burdens facing small businesses and others, and about certain IRS collection practices.Among the areas the report identifies for particular emphasis in FY 2011 are the following:1. Taxpayer Services.

Spending for IRS taxpayer service programs has been declining in recent years. At the same time, more taxpayers have been contacting the IRS for assistance as the IRS has been tasked with administering an increasing number of social benefit programs, including Economic Stimulus Payments, Making Work Pay credits, and First-Time Homebuyer credits. The report says that as a result of the imbalance between taxpayer demand and IRS resources, the IRS has fallen short of providing adequate taxpayer service in important areas. Most notably, after answering a high of 87 percent of its calls from taxpayers seeking to reach a telephone assistor in FY 2004, the IRS answered only 53 percent of its calls in FY 2008 and has set of goal of answering only 71 percent in the current fiscal year.

The report attributes much of the problem to inadequate funding for taxpayer services. While funding for the IRS overall has been increasing in recent years, the additional funding has been earmarked for enforcement programs. An analysis of IRS budget trends conducted by TAS shows that since FY 2004, inflation-adjusted funding for IRS enforcement activities has risen by 17.9 percent while spending for taxpayer service programs has declined by 6.8 percent, as shown in the following chart:

Taxpayer Services vs. Enforcement Spending Since FY 2004, Adjusted to 2010 Dollars (May 2010)

Moreover, a substantial portion of the budget for taxpayer service includes the costs of processing tax returns, which is essentially an overhead function. Funding for core taxpayer service (known as “Pre-filing Taxpayer Assistance and Education”) now stands at only $685 million, or six percent of the IRS budget. The report notes further that the Administration’s FY 2011 budget proposal projects that funding for taxpayer services will decline by another 7.2 percent over the next two years (FY 2012 and FY 2013), while funding for enforcement will increase by an additional 13.7 percent.

The report asserts the cuts in taxpayer service spending are harmful both because they undermine tax compliance and because they undermine the IRS’s ability to successfully deliver social benefit programs. First, with respect to tax compliance, Ms. Olson states:

There appears to be an implicit assumption built into existing budget procedures and projections that raising tax compliance requires ramping up enforcement and that taxpayer service is less important – perhaps even unimportant – for compliance. We think this implicit assumption is wrong. . . . Consider an individual without a college degree who becomes a successful plumber or electrician with a growing customer base. If he hires employees, he will face a host of employment, immigration verification, and state and federal tax requirements, including the need to withhold and pay over payroll taxes and to file employment tax and income tax returns on behalf of his business. For most taxpayers, these requirements would seem daunting or even impenetrable, and some taxpayers inevitably do not comply simply because they have no idea where to begin.

The report states that many noncompliant taxpayers are baffled by complex rules and states that additional taxpayer service, particularly outreach and education, could improve tax compliance.

Second, with respect to the IRS’s ability to deliver social programs, the report expresses concern that the IRS currently is neither structured nor funded to do the job effectively. “I have no doubt the IRS is capable of administering social programs, including health care,” Ms. Olson said. “But Congress must provide sufficient funding and the IRS itself must recognize that the skills and training required to administer social benefit programs are very different from the skills and training that employees of an enforcement agency typically possess. While some enforcement measures are required to prevent inappropriate claims, the overriding objective of agencies that administer social benefit programs is to help as many eligible persons qualify for the benefits as possible. That requires outreach and working one-on-one with potentially eligible individuals. If the IRS continues to ramp up enforcement while reducing taxpayer service programs, I would be concerned about its ability to administer the new health care credits and penalty taxes in a fair and compassionate way.”

Ms. Olson suggests that the IRS mission statement be revised to explicitly acknowledge the agency’s dual role as part tax collector and part benefits administrator. Such a revision would require the IRS to develop a strategic plan that gives sufficient attention to both roles and would underscore that the IRS requires sufficient funding to perform both functions effectively.

During FY 2011, TAS will continue to advocate for improved taxpayer services and will continue to make the case that taxpayer service is important not only as a courtesy but as a driver of tax compliance as well.

2. New Business and Tax-Exempt Organization Reporting Requirements.

The report expresses concern that a new reporting requirement contained in the Patient Protection and Affordable Care Act may impose significant compliance burdens on businesses, charities, and government agencies. Beginning in 2012, all businesses, tax-exempt organizations, and federal, state and local government entities will be required to issue Forms 1099 to vendors from whom they purchase goods totaling $600 or more during a calendar year. To meet this requirement, these businesses and entities will have to keep track of all purchases they make by vendor. For example, if a self-employed individual makes numerous small purchases from an office supply store during a calendar year that total at least $600, the individual must issue a Form 1099 to the vendor and the IRS showing the exact amount of total purchases. The provision will have broad reach. According to a TAS analysis of 2009 IRS data, about 40 million businesses and other entities will be subject to the new requirement, including roughly 26 million non-farm sole proprietorships, four million S corporations, two million C corporations, three million partnerships, two million farming businesses, one million charities and other tax-exempt organizations, and more than 100,000 government entities. All of these nearly 40 million businesses and other entities are subject to the new reporting requirement.

TAS has not yet reached any conclusions regarding the benefits and burdens of the requirement, but the report expresses concern that the burdens “may turn out to be disproportionate as compared with any resulting improvement in tax compliance.” During FY 2011, TAS will study the impact of the new reporting requirement more closely and, depending on what its study finds, may propose administrative or legislative recommendations to modify the provision or suggest that Congress consider less burdensome tax gap proposals, including a TAS proposal to require reporting of non-interest bearing bank accounts, to replace it.

3. IRS Collection Practices.

The report expresses continuing concern that IRS collection practices emphasize collection of past-due liabilities even where doing so inflicts unnecessary or disproportionate harm on taxpayers and jeopardizes future tax collection. “The conventional wisdom seems to be that more hard-core enforcement actions like liens and levies mean more revenue,” Ms. Olson said. “But the data don’t bear that out. Since FY 1999, the IRS has increased tax lien filings by about 475 percent and levies by about 600 percent, yet inflation-adjusted revenue raised by the IRS Collection function has actually declined by about seven percent over that period.”

Lien filings can badly damage a taxpayer’s financial viability because lien filings appear on credit reports, causing the taxpayer’s credit score to drop an average of about 100 points immediately and causing lasting harm because they typically remain on the taxpayer’s credit record for at least seven years. Many employers, mortgage companies, landlords, car dealerships, and credit card issuers check credit reports, so the filing of a tax lien can adversely affect the taxpayer’s ability to obtain and retain a job, purchase a home, rent an apartment, or obtain credit generally. Accordingly, a lien filing may reduce the taxpayer’s income or increase his expenses, thereby impairing his ability to pay tax in the future. Last year, the IRS filed nearly one million liens against taxpayers.

The report also notes that the IRS has issued at least four public statements over the past year-and-a-half pledging to assist financially struggling taxpayers who are having difficulty paying their tax bills. Yet the number of liens and levies has continued to rise, the number of offers-in-compromise the IRS is accepting is near an all-time low, and there is little evidence the IRS is changing its collection practices.

After publication of her 2009 Annual Report to Congress, Ms. Olson issued several Taxpayer Advocate Directives to the IRS on lien issues, including directives (i) to discontinue its policy of automatically filing tax liens in cases where the IRS has determined that the taxpayer’s account should be placed into “currently not collectible” status based on financial hardship and (ii) to require managerial approval for the filing of liens in cases where the taxpayer owns no assets. She has also urged the IRS to expand the availability of the offer-in-compromise program for financially struggling taxpayers who cannot reasonably pay their tax debts in full.

In response to these concerns, the IRS has convened a senior-level task force to conduct a comprehensive review of collection practices. Ms. Olson writes that she appreciates the IRS’s willingness to examine the issue. However, she remains concerned that it will take years to conduct the comprehensive review, and that in the interim, the IRS will continue both to damage taxpayers’ credit ratings and to undermine long-term tax compliance without any significant revenue gains to show for their actions. Accordingly, IRS collection practices will remain a key area of focus for TAS in FY 2011.

The National Taxpayer Advocate is required by statute to submit two annual reports to the House Committee on Ways and Means and the Senate Committee on Finance. The statute requires these reports to be submitted directly to the Committees without any prior review or comment from the Commissioner of Internal Revenue, the Secretary of the Treasury, the IRS Oversight Board, any other officer or employee of the Department of the Treasury, or the Office of Management and Budget. The first report is submitted mid-year and must identify the objectives of the Office of the Taxpayer Advocate for the fiscal year beginning in that calendar year. The second report, due on December 31 of each year, must identify at least 20 of the most serious problems encountered by taxpayers, discuss the ten tax issues most frequently litigated in the courts, and make administrative and legislative recommendations to resolve taxpayer problems.

If you are facing tax problems and in need of professional representation to get tax relief for unpaid back taxes, or unfiled returns, or if you are a business facing 941 tax problems, call us today at 1-877-78-TAXES. We are a professional tax representation firm that offers tax relief services, visit us online at

Tax Problems are problems related to Taxation and most prominent is Income taxation. It affects natural persons – individuals or people and juridical persons – companies, corporation and other legal entities. Tax problems begins from the time you start earning for a living and receiving income or making profits, every time you spend or the expenses you incur up to the time you have spent all of your hard-earned money and profits. Tax Problems are those affecting any benefits you receive from the government and elsewhere, the tax exemptions you enjoy; even the savings you made and interest you earn and receive from any savings and investments. Tax problems also affect the home or properties you buy and sell; it involves even the how many children you have and if you donate to some charity or if somebody makes any payment to you or if you just inherited a lump sum of money, Tax Problem will be there if you don’t declare all you financial transactions and activities and don’t check which are taxable and not and if so, when, when and how to make tax payments.

This is so because, tax problem covers situations from the preparation of the income tax return, calculating the tax liabilities, earnings and expenses and exemptions until the full payment of the income tax is made. But this is just under the normal circumstances. Tax problems also arise under special circumstances like late in filing of the return, late in payment of the tax due, extension in filing returns, extension in payment of tax or taxes, and payment in installments. When you think everything is already fine and complied with, you will be notified and learn of a Tax Lien, Tax Levy or a Bank Levy against you and even garnishment on your wage. You may well discover that a tax audit has been made and discovery of deficiency in payment arising out of improper or erroneous calculation of tax, discovery of inconsistencies between that declared in your income statement, expenses and exemptions as against the records of the IRS from other sources such as your employer’s payroll, your bank statement and for companies – calculation of sales tax and other duties and taxes, 941 Payroll tax and many more; the incorrect calculation of interests and consequently erroneous payment of the amount due.

When you resort to solving the tax problem, you will find that you will encounter more related tax problems in paying back taxes, problems in settling your debt, problem in negotiating with the IRS, problem in complying with IRS payment plan and what have you. For an individual, untrained mind in the field of taxation, even small and big business, this is a real headache and the simplest issue in complying with form alone, albeit, the substance is enormous as a cross carried on one’s shoulder.

The reality is far worse than it seems. The question is: Can you handle the situation of your tax problems without an expert advice and assistance?

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Mike Habib, EA provide tax relief services and solutions to any tax problem, call us today toll free at 1-877-78-TAXES (877-788-2937) also online at

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Christian IRS Tax Help

Christian IRS Tax help means reliable and professional help by a Christian tax professional. It is correlated with real solutions to IRS or State tax problems of a taxpayer with unpaid back taxes. Most people avoid this topic while others ignite upon hearing IRS or TAX. But the truth is that, the IRS Tax Help is about tax problems assistance or simply means that there are several ways to help you if you have IRS or State tax problems. For the record, it is not only the duty of the IRS officers and agents to effectively collect taxes or review tax returns or statement of income or perform detailed analysis of financial status of the taxpayer or otherwise give them difficulties and headache, it is also the duty of the IRS to help and assist taxpayers with their taxation problems, or find a solution to a taxpayers’ liability. The IRS also offers tax resolution or relief options to provide tax amnesty in some cases to delinquent taxpayers. Our firm provides IRS Tax help to our clients, either individual taxpayers or businesses with back taxes.

The problem with the IRS and its personnel is that, they are aggressive, zealous and trained to collect the most out of taxpayers coupled with their personal and family problems that they fail to qualify as an effective aid and vigilant sentry for the taxpayer when it comes to IRS Tax help or tax problem resolution. Their most important and primordial function is to collect taxes as quickly as possible. While voluntary and free aid organizations more or less lack the necessary experience and expertise to go through the intricacy, complexity and difficulty of the procedures and substance in resolving tax problems and issues. In either way loyalty, trustworthiness and sincerity are often needed for effective Christian IRS Tax Help.

A legitimate tax relief company or a tax resolution firm, a tax relief specialist, an enrolled agent, a tax lawyer or a CPA is more favoured and attuned to be solicited for advice and assistance. They are the experts in this field, IRS Tax Help, and mostly have the necessary experience in delivering the needed help and assistance.

It is confusing at times when seeking Christian tax help being necessary and needed. We can hear of Tax Relief, Tax Resolution, Tax Amnesty, Penalty Abatement and many more. But what are they really? Tax Relief and Tax resolution are the same and they all pertain to the civil aspect of tax liability while Tax Amnesty usually pertains to the criminal aspect of tax problems. Penalty abatement is just one of the tax relief options available to a debtor taxpayer along with IRS Offer in Compromise, Installment Agreement / Payment Plan, removing you from active collection or CNC status, Innocent Spouse and many more. IRS Tax help can give you peace of mind and the details can be elicited once you consult with an experienced and reliable tax professional solely concentrating in this subject matter.

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Christian tax debt relief help offered in in areas such as: Los Angeles, Pasadena, Glendale, Burbank, Orange County, Riverside, Palm Springs, San Bernardino, Palmdale, Bakersfield, New York, New Jersey, Chicago, Houston, Phoenix, Philadelphia, San Antonio, San Diego, Dallas, San Jose, Detroit, Jacksonville, Indianapolis, San Francisco, Columbus, Austin, Memphis, Fort Worth, Baltimore, Charlotte, El Paso, Boston, Seattle, Washington DC, Milwaukee, Denver, Louisville, Jefferson, Las Vegas, Reno, Hempstead, Tucson, Nashville, Davidson, Portland, Tucson, Albuquerque, Santa Fe, Anchorage, Atlanta, Long Beach, Fresno, Sacramento, Mesa, Kansas City, Cleveland, Virginia Beach, Omaha, Miami, Oakland, Tulsa, Honolulu, Minneapolis, Pittsburgh, Colorado Springs, Arlington, Wichita, Birmingham, Montgomery, Tampa, Orlando

IRS Offers Tax Help to Oil Spill Victims


The Internal Revenue Service has issued guidance to individuals and businaesses affected by the oil spill in the Gulf of Mexico and announced new efforts to help affected taxpayers, including a special Gulf Coast Assistance Day on July 17.

“This is a very difficult time for many people affected by the oil spill in the Gulf of Mexico,” said IRS Commissioner Doug Shulman in a statement. “As residents of the region cope with the evolving situation, I want to assure them that the IRS will be doing everything it can to provide tax help to those who need it. We encourage anyone who has an issue with the IRS to contact us and explain their hardship, and we will work with them to find a solution. We’ll do everything we can under current law to help taxpayers.”

The guidance released Friday is based on current law, and it explains how recipients of payments from BP should treat the payments for tax purposes. According to the current law, BP payments for lost income are taxable in the same way that the wages or business income these payments are replacing would have been. The law treats compensation for lost wages or income differently for tax purposes than compensation for physical injuries or property loss, which generally are nontaxable.

Every person can have unique financial circumstances, so the IRS encourages taxpayers to review their tax situation or talk with their tax preparers about the implications of payments or compensation from the oil spill.

The new information is available in a question-and-answer format on a special section of the IRS website, The IRS is closely monitoring the situation in the Gulf, and additional information will be added to as it becomes available.

To help people in the Gulf Coast area dealing with tax issues, the IRS also announced a special assistance day on July 17 in seven cities. Taxpayers and tax preparers will be able to work directly with IRS employees to resolve tax issues, including specific topics related to the oil spill. The IRS will hold the Gulf Coast Assistance Day in four states:

• Alabama: Mobile.
• Florida: Panama City and Pensacola.
• Louisiana: New Orleans, Houma and Baton Rouge.
• Mississippi: Gulfport.

Times and specific locations will soon be announced and will be available on

In addition, taxpayers with problems related to the Gulf spill will soon be able to reach IRS personnel through an IRS toll-free telephone line. Specially trained IRS personnel will be available to help people with tax questions related to the oil spill. More information will be available soon about this telephone line.

The IRS encourages taxpayers in the Gulf struggling with payment or collection issues to contact the agency. The IRS continues to have a number of ways to help taxpayers dealing with oil spill issues or other economic hardship issues, including:

• Assistance of the Taxpayer Advocate Service for those taxpayers experiencing particular hardship navigating the IRS.
• Postponement of collection actions in certain hardship cases.
• Added flexibility for missed payments on installment agreements and offers in compromise for previously compliant individuals having difficulty paying.
• IRS employees will be permitted to consider a taxpayer’s current income and potential for future income when negotiating an offer in compromise.
• Accelerated levy releases for taxpayers facing economic hardship.

For tax problem resolution and tax relief services contact our firm at 1-877-788-2937

Alivio de problemas de impuestos federales (IRS), Alivio de problemas de impuestos estatales (BOE or FTB), Alivio de problemas de impuestos del empleador (EDD).

Español Tax Relief Help Call 1-877-970-7007

En Mike Habib EA, una compañia Californiana de ayuda para problemas de impuestos, entendemos que ser notificado que sus declaraciones de impuestos estan siendo inspeccionadas por el IRS o el estado puede ser intimidatorio. Cuando uno se encuentra frente a una auditoria o un proceso de coleccion por el IRS o el estado, uno no sabe que hacer o para donde voltear. Nuestra compañia cuenta con todas las habilidades y experiencia para negociar con el IRS o el estado en defensa suya. Nuestra compañia entiende las reglas y tenemos la experiencia adecuada para negociar la menor cantidad de dinero a pagar aprobada por la ley.

Servicios de alivio de problemas de impuestos:

Representacion en auditorias de impuestos del IRS

Ofertas de Arreglo – Negociaciones de liquidacion

941 Ayuda para problemas de impuestos de nomina de sueldos

Ayuda de impuestos atrasados

Impuestos no pagados

Alivio de proceso de coleccion

Negociacion de arreglo de pagos

Enmendar o corregir declaraciones de impuestos que ho han sido preparadas aun

Detenga la confiscacion o embargo de su salario – Detenga las coleciones del IRS

Detenga la confiscacion o embargo de sus cuentas bancarias

Servicios de resolucion

Si usted ha recibido un aviso o notificacion del IRS, FTB, BOE, or EDD, o si usted tiene impuestos no pagados o declaraciones de impuestos atrasadas, contacte nuestras oficinas inmediatamente al 1-877-970-7007 de esta manera podemos buscar la mejor solucion a sus problemas de impuestos. El ignorar sus problemas de impuestos no ayuda, no arriesge su tranquilidad. Deje que nuestra compañia le ofrezca un nuevo comienzo.

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IRS Tax Help, IRS Tax Audit / Examination & Tax Relief RIVERSIDE COUNTY ¿PROBLEMAS DE IMPUESTOS?:

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Adelanto – Angeles Oaks – Apple Valley – Barstow – Big Bear City – Big Bear Lake – Bloomington, Blue Jay – Cedar Glen – Cedarpines Park – Chino – Chino Hills – Colton – Crest Park – Crestline, Daggett – Fawnskin – Fontana – Forest Falls – Grand Terrace – Green Valley Lake – Helendale – Hesperia – Highlands – Hinkley – Joshua Tree – Lake Arrowhead – Landers – Loma Linda – Lucerne Valley – Lytle Creek – Mentone – Montclair – Morongo Valley – Needles – Newberry Springs – Ontario – Oro Grande – Phelan – Pinon Hills – Pioneertown – Rancho Cucamonga – Redlands – Redlands – Rialto – Rim Forest – Running Springs – San Bernardino – Sky Forest – Sugarloaf – Trona – Twentynine Palms – Twin Peaks – Upland, Victorville – Wrightwood – Yermo – Yucaipa – Yucca Valley .

IRS Tax Help, IRS Tax Audit / Examination & Tax Relief SAN DIEGO COUNTY ¿PROBLEMAS DE IMPUESTOS?:

Alpine – Bay Park – Bonita – Bonsall – Borrego Springs – Boulevard – Campo – Carlsbad – Chula Vista – Clairemont – College Grove – Coronado – Del Mar – Descanso – Downtown – Dulzura, East San Diego – El Cajon – Encanto – Encinitas – Escondido – Fallbrook – Grantville – Hillcrest, Imperial Beach – Jacumba – Jamul – Julian – La Jolla – La Mesa – Lakeside – Lemon Grove – Linda Vista – Logan Heights – Mission Village – National City – Normal Heights – North City West, North Park – Ocean Beach – Oceanside – Pacific Beach – Palomar Mtn – Paradise Hills – Pauma Valley – Pine Valley – Point Loma – Potrero – Poway – Ramona – Ranchita – Rancho Bernardo – Rancho Penasquitos – Rancho Santa Fe – San Carlos – San Diego – San Marcos – San Ysidro – Santa Ysabel – Santee – Scripps Ranch – Solana Beach – South San Diego – Spring Valley – Spring Valley – Tierrasanta – University City – Valley Center, Vista – Warner Springs .

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Espanol Tax Relief Help Call 1-877-970-7007


¿PROBLEMAS CON LOS IMPUESTOS? NO DEJE QUE ARRUINEN SU VIDA! (877)970-7007 LLAME AHORA A LA LINEA DE AYUDA PARA RECIBIR UNA CONSULTA GRATIS! (877)970-7007 What’s your IRS problem? Cual es su problema de impuestos? Back Taxes, Late Tax Returns, Identity Theft, Harassment, IRS Levy, IRS Tax Liens, Payroll Taxes, Can’t Pay the Tax, Tax Bill Error, Unfiled Taxes, IRS Penalties, Wage Garnishment, Bank Levies. (877) 970-7007 SUS PROBLEMAS DE IMPUESTOS TIENEN SOLUCION!

Espanol tax relief and IRS tax help services in all 50 states including Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, District of Columbia, Florida, Georgia, Guam, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Puerto Rico, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, Wyoming.

Payroll Tax Problems 941 / 940 – Unpaid employment tax relief

The 941 Payroll Tax problem is businesses’ tax problem concerning their payroll. Before understanding what a 941 payroll tax problem is, it is important to know what it is. There are three (3) main types of taxes falling under the category of payroll taxes. First is the regular income tax that must be withheld from the business’ employees’ wages or salaries. Second is the Federal Insurance Contribution Act (FICA), which is a contribution to the Social Security and Medicare. The third is the Federal Unemployment Tax (FUTA).

The first is commonly known as the withholding taxes from employees which will appear in their individual pay vouchers or pay slips. The amount of taxes withheld is dependent upon the earnings of an individual employee, exemptions and deductions and basically based on their individual returns and calculation. An error in the deduction is considered a 941 payroll tax problem. On the second tax, Employers are required to withhold from the employees 7.65 percent of the first $62,700 income and match that amount so that the total FICA contribution will be equivalent to 15.3 percent. Again erroneous calculation of the percentage amount will fall as a 941 payroll tax problem. If you are a Self-employed persons, you have to should both or the entire FICA tax. The FUTA tax is solely paid by the employer equivalent to approximately 1 percent of the first $7,000 wages of an employee.

So aside from withholding payroll taxes for employees, employers must remit these taxes to the IRS on prescribed periods and manner, failure on their part to remit or errors in the manner of remittance is another payroll tax problem. The income taxes withheld from employees payroll and the employees’ portion of the FICA taxes that are also withheld from their pay every pay period must be remitted to the IRS monthly together with the Federal Tax Deposit Coupon (Form 8109-B). However, if the total amount withheld is less than $500, the employer taxpayer may make the payments quarterly. Employers must also file four different reports regarding payroll taxes. The first report is the Employer’s Quarterly Federal Tax Return made under Form 941 providing thereon the number of employees in the payroll, the amount of wages they were paid, and the amount of taxes that were withheld for the quarter. Therefore, the business-taxpayer had to prepare a payroll, deduct employees’ taxes, remit the deduction to the IRS and make a report of these facts in Form 941. All tax problems arising and related to Form 941 is what we refer to as the 941 payroll tax problem.

On top of the monthly and quarterly activities explained above, the employer taxpayer must file the other three reports annually. Form W-2 which is the Annual Statement of Taxes Withheld must also be sent to the Social Security Administration. The third report under Form W-3 which must be sent to the IRS by February 28 of the following year provides a formal reconciliation of the quarterly tax payments under Form 941 and the annual totals reported on Form W-2 for all employees. The fourth and last report which is the Federal Unemployment Tax Return, Form 940, outlines the total FUTA taxes owed and paid for the year.

The money involved which are in the possession of the employer’s taxpayer are in reality not their money but the money of the IRS, FICA and FUTA mostly coming from the employees in the form of withholding tax. They are in possession of the tax money they are holding in trust or as they call it Trust Tax, or Trust Funds. Failure to remit the collected FICA and the IRS is considered as theft as it is the taking of somebody else’s money. In other countries, this is considered as Estafa which is considered also as a Criminal Offense and for this reason, the IRS speeds up the process in running after and recovering from the employer taxpayer the money robbed and stolen. Payroll Tax problems are not only about non-remittance to the IRS of the deducted taxes, it also includes erroneous deduction of withholding tax, erroneous reporting of the amount, the IRS number, the employees’ name and anything and everything about payroll. Payroll tax problems are often causes of business collapse or what usually brings down a profitable newly established business as well as small and medium size businesses, the very reason why a department is usually created in a company or business just to deal with Payroll Tax Reporting.

Mike Habib, EA is a tax relief expert and represents employers with payroll tax problems before all administrative levels of the IRS. We are A+ Rated by the Better Business Bureau, and licensed to represent employers in all 50 states. Call us today at 1-877-78-TAXES (877-788-2937).

Tax Relief – Get tax debt relief today

Reasonable Cause/Good Faith Defense: Even if the taxpayer did not have substantial authority for a position and failed to make adequate disclosure, the substantial understatement penalty does not apply if the taxpayer had reasonable cause for the tax underpayment and acted in good faith [IRC Sec. 6664(c); Reg. 1.6664-4]. This defense is applied on a “facts and circumstances” basis [Reg. 1.6664-4(b)]. However, the key factor seems to be whether the taxpayer made a reasonably energetic attempt to determine the correct tax liability. For example, an honest misunderstanding of fact or law, an isolated computational error, reliance on professional tax advice, or reliance on information returns all indicate reasonable cause/good faith. However, if the taxpayer should have known better, the defense will not apply.
Observation: According to IRM, the most important factor in determining whether the taxpayer has reasonable cause and acted in good faith is the extent of the taxpayer’s effort to report the proper tax liability. For example, reliance on erroneous information reported on an information return indicates reasonable cause and good faith, provided the taxpayer did not know or have reason to know that the information was incorrect. Similarly, an isolated computational or transcription error may indicate reasonable cause and good faith. Other factors to consider are the taxpayer’s experience, knowledge, sophistication, education, mental and physical condition, and reliance on the advice of a tax advisor.

Reg. 1.6664-4(c) discusses when a taxpayer is considered to have reasonably relied in good faith upon someone else’s advice (including that of a professional tax advisor). According to the regulation, meeting the following requirements, while not guaranteeing that the accuracy-related penalty will be avoided, tends to indicate that the “reasonable reliance” and “good faith” aspects have been met:
a. The advice must be based on all pertinent facts and circumstances and the law as it relates to those facts and circumstances. For example, the advice must take into account the taxpayer’s purposes (and the relative weight of such purposes) for entering into a transaction and for structuring a transaction in a particular manner.
b. The taxpayer must inform the adviser of all facts that are known, or should be known, to be relevant to the proper tax treatment of an item.
c. The advice must not be based on unreasonable factual or legal assumptions (including assumptions about future events) and must not unreasonably rely on the representations, statements, findings, or agreements of the taxpayer or any other person. For example, the advice must not be based upon a representation or assumption that the taxpayer knows, or has reason to know, is unlikely to be true, such as the taxpayer’s purposes for entering into a transaction.
d. Reliance on the adviser may not be reasonable or in good faith if the taxpayer knew, or should have known, that the adviser lacked knowledge in the relevant aspects of federal tax law.

When taxpayers reasonably relied on the advice of an expert concerning a sham investment, the 5th Circuit Court held that the reasonable cause defense applied and stated that the taxpayers were not required to challenge the expert, seek a second opinion, or try to monitor the expert on the provisions of the Code. To require otherwise would nullify the purpose of seeking expert advice (Chamberlain).

Our firm represents taxpayers before all administrative levels of the IRS in all 50 states, get tax relief today by calling 1-877-78-TAXES (877-788-2937). Also online at

We provide tax relief services in all 50 states including Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, District of Columbia, Florida, Georgia, Guam, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Puerto Rico, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, Wyoming.

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R&TC Section 17014(a) defines “resident” as:

  • Every individual who is in this state for other than a temporary or transitory purpose;
  • Every individual domiciled in this state who is outside the state for a temporary or transitory purpose.

Under this definition, an individual may be a resident of California although not domiciled in California, and, conversely, may be domiciled in California without being a resident of California. Residency determines what income is taxable by California (CCR Section 17014).

The theory behind California residency law is to define the class of individuals who should contribute to the support of this state (CCR Section 17014).

R&TC Section 17014(b) provides a special rule for certain United States Government
officials and their spouses. If those individuals have a California domicile, we will consider their absences from this state as temporary or transitory. They remain California residents.

This rule applies to the following persons:

  • Any elected U.S. official.
  • Anyone on the staff of a member of the U.S. Congress.
  • Any presidential appointee, subject to Senate confirmation, other than military and Foreign Service career appointees.

R&TC Section 17014(c) provides that any individual who is a resident of California remains a resident even though temporarily absent.


CCR Section 17014(b) provides a detailed discussion of the meaning of “temporary or
transitory purpose.” According to this regulation, the determination of whether or not an
individual is in this state for temporary or transitory purposes depends to a large extent upon the facts and circumstances of each particular case. Generally, we consider an individual to be in California for a temporary or transitory purpose, and therefore a nonresident of California, if he or she is:

  • Simply passing through this state.
  • Here for a brief rest.
  • Here for a vacation.
  • Here for a short period to complete a particular transaction, perform a particular contract, or perform a particular engagement.

Example 1

James and Janice are domiciled in Minnesota where they have maintained their family home for seven years. James works for a state agency in Minnesota. In October 2005, James took a six-month leave of absence to become a temporary consultant for a California company. James and Janice moved to Los Angeles, CA in October 2005, where they rented an apartment and opened a checking account. Their home in Minnesota was left vacant and they retained their Minnesota bank accounts. They stayed in California from October 2005, to April 2006, and returned to Minnesota in April 2006.


James and Janice were in California for a short period in order for James to complete a
particular engagement as a temporary consultant. James and Janice are nonresidents of
California because they were in California for a temporary or transitory purpose.

An individual will be considered to be in California for other than temporary or transitory
purposes, and therefore a California resident, if he or she is in this state:

  • To recuperate from injury or illness for a relatively long or indefinite period.
  • For a business purpose which will require a long or indefinite period to accomplish.
  • For employment in a position that may last permanently or indefinitely.
  • For retirement with no definite intention of leaving shortly.

Example 2

Bob is domiciled in Ohio and has lived there for 50 years. Two years ago Bob developed a serious medical condition. His doctor told him to live in California until he recovers. The illness may last for several years. Bob took his doctor’s advice and moved to California two years ago.


Bob is in California for an indefinite period in order to recuperate from an illness. He is a
California resident because his stay in California is not for a temporary or transitory purpose.

CCR Section 17014(b) provides that the state with which a person has the closest
connections during the taxable year is the person’s state of residence. In the Appeal of
Richard L. and Kathleen K. Hardman, 1975-SBE-052, August 19, 1975, the Board of
Equalization held that the connections which a taxpayer maintains in this and other states are important objective indications of whether presence in or absence from California is for a temporary or transitory purpose.

In the Appeal of Stephen D. Bragg 2003-SBE-002, May 28, 2003, the Board of Equalization included the following list of factors which, while not exhaustive, inform taxpayers of the type and nature of connections the Board of Equalization and the Franchise Tax Board find informative when determining residency:

  • The location of all of the taxpayer’s residential real property, and the approximate sizes and values of each of the residences.
  • The state wherein the taxpayer’s spouse and children reside.
  • The state wherein the taxpayer’s children attend school.
  • The state wherein the taxpayer claims the homeowner’s property tax exemption on a residence.
  • The taxpayer’s telephone records (i.e., the origination point of taxpayer’s telephone calls).
  • The number of days the taxpayer spends in California versus the number of days the
  • taxpayer spends in other states, and the general purpose of such days (i.e., vacation, business, etc.).
  • The location where the taxpayer files his tax returns, both federal and state, and the state of residence claimed by the taxpayer on such returns.
  • The location of the taxpayer’s bank and savings accounts.
  • The origination point of the taxpayer’s checking account transactions and credit card transactions.
  • The state wherein the taxpayer maintains memberships in social, religious, and professional organizations.
  • The state wherein the taxpayer registers his automobiles.
  • The state wherein the taxpayer maintains a driver’s license.
  • The state wherein the taxpayer maintains voter registration and the taxpayer’s voting participation history.
  • The state wherein the taxpayer obtains professional services, such as doctors, dentists, accountants, and attorneys.
  • The state wherein the taxpayer is employed.
  • The state wherein the taxpayer maintains or owns business interests.
  • The state wherein the taxpayer holds a professional license or licenses.
  • The state wherein the taxpayer owns investment real property.
  • The indications in affidavits from various individuals discussing the taxpayer’s residency.

It is particularly relevant to determine whether the taxpayer substantially severed his or her California connections upon departure and took steps to establish significant connections with the new place of abode. It is also necessary to determine whether the connections in California were maintained in readiness for his or her return. See the Appeal of Richard L. and Kathleen K. Hardman, supra.

Whether a person was in California for other than a temporary or transitory purpose must be determined by examining all of the facts. Mere formalisms such as changing voting registration to another state or statements to the effect that the taxpayer intended to be a resident of another state are not controlling. See the Appeal of Tyrus R. Cobb, 1959-SBE-014, March 26, 1959.

Note that retention of some contacts such as bank accounts and a driver’s license may only be a reflection of the taxpayer’s past and may not be inconsistent with an absence for other than temporary or transitory purposes. See the Appeal of Richard L. and Kathleen K. Hardman, supra.


CCR Section 17014(b) provides that an individual whose presence in California does not
exceed an aggregate of six months within a taxable year and who is domiciled without the state and maintains a permanent abode at the place of his domicile will be considered as being in this state for temporary or transitory purposes. However, he or she must not engage in any activity or conduct within this state other than that of a seasonal visitor, tourist, or guest.

The following connections with California will not, by themselves, cause a seasonal visitor, tourist, or guest to lose his or her status as such:

  • Owning or maintaining a home.
  • Opening a bank account for paying personal expenses.
  • Having membership in local social clubs.

Example 1

Bill and Sue lived and worked in North Dakota for 20 years until their retirement in the
summer of 2005. Beginning the winter of 2005, Bill and Sue spend four months each year in California. They spend the remaining eight months in North Dakota. While in North Dakota, they live in a home they have owned since 1995. They hold valid North Dakota driver’s licenses, are registered to vote in North Dakota, and maintain North Dakota bank accounts.

Bill and Sue also own a California home, which they use while in California. They also
opened a California checking account for their personal expenses and are members of a
California country club. While in California, they do not engage in any California business


Bill and Sue are considered to be seasonal visitors, in California for temporary or transitory purposes. Therefore, they are nonresidents of California.


R&TC Section 17016 states: “Every individual who spends in the aggregate more than nine months of the taxable year within this state shall be presumed to be a resident. The presumption may be overcome by satisfactory evidence that the individual is in the state for a temporary or transitory purpose.”

Note that R&TC Section 17016 merely provides a presumption of residence. The
presumption can be overcome. For example, in the Appeal of Edgar Montillion Woolley,
1951-SBE-005, July 19, 1951, the Board of Equalization ruled that the taxpayer was in
California for a temporary or transitory purpose even though he was in California for more that nine months during the year. The decision was based on the fact that during his stay in California, Mr. Woolley lived in a hotel on a weekly basis and his departure was delayed because of illness and a studio strike.

CCR Section 17016 provides that presence within California for less than nine months does not constitute a presumption of nonresidency. On the contrary, a person may be a California resident even though not in this state during any portion of the year.


Domicile is an integral part of the definition of resident. An individual domiciled in California and absent from the state for a temporary or transitory purpose is considered to be a California resident. An individual’s domicile also determines whether income received by a husband or wife is community or separate income.

CCR Regulations Section 17014(c) defines the term “domicile” as the place where an
individual has his or her true, fixed, permanent home and principal establishment. It is the place to which, whenever absent, he or she has the intention of returning. It is the place in which a person has voluntarily fixed his or her habitation and the habitation of his or her family. It is the place where a person has the present intention of making a permanent home, until some unexpected event shall occur to induce him or her to adopt another. It is not a place where a person is living for a mere special or limited purpose.

As stated by the California Court of Appeal, “domicile” is the one location with which, for
legal purposes, a person is considered to have the most settled and permanent connection.

It is the place where they intend to remain and to which, whenever they are absent, they have the intention of returning. See Whittell v. Franchise Tax Board, 231 Cal.App.2d 278 (1964).

An individual can have only one domicile at a time. If an individual has acquired a domicile at one place, the individual retains that domicile until another is acquired elsewhere.

A California domiciliary leaving the state retains his or her California domicile as long as he or she has the definite intention of returning here. This is true regardless of the length or reason of the absence. An individual domiciled in California who leaves the state loses his or her California domicile at the moment he or she abandons any intention of returning to California and locates elsewhere with the intention of remaining there indefinitely.

The concept of domicile involves not only physical presence in a particular place, but also the intention to make that place one’s home. See the Appeal of Anthony J. and Ann S. D’Eustachio, 1985-SBE-040, May 8, 1985.

In order to change one’s domicile, a person must actually move to a new residence and
intend to remain there permanently or indefinitely. See Noble v. Franchise Tax Board 118 Cal.App. 4th 560 (2004).

The burden of proving the acquisition of a new domicile is on the person asserting that
domicile has been changed. See the Appeal of Frank J. Milos, 1984-SBE-042, February 28, 1984.

Adam, who is domiciled in Illinois, comes to California on business, but intends to return to Illinois as soon as his business in California is completed. He maintains a California home while in California and stays in California for 11 months.


Adam retains his Illinois domicile. His stay in California is for a limited purpose.

Example 2

Mark moved from Alaska to California in October 2000, to begin a permanent job. He sold his home in Alaska and purchased a home in California. He moved all his personal
belongings to California, opened a California bank account, and obtained a California driver’s license. He has no intention of returning to Alaska.


Mark became a California domiciliary in October 2000, when he moved to California. He
came to California with the intention to remain here indefinitely with no fixed intention of
returning to Alaska.

Example 3

Allen and his wife Ellen were both born and raised in California. Upon graduation from a
California college, Allen obtained employment in Los Angeles, CA. In 1999, Allen was sent to France for a one-year assignment. Ellen remained at their home in California with their two children. While in France, Allen rented an apartment and joined a local soccer league. He returned to California in 2000.


Allen remained a California domiciliary during his absence. He did not sever his ties with
California and the ties established with France did not show that he intended to remain
there permanently.


Domicile and residency are not synonymous. California distinguishes them as two separate concepts. For income tax purposes, residency determines what income is taxable to California. Domicile is an important component of residency and determines whether income is split between spouses.

Domicile is the place where an individual has his or her true, fixed, permanent home and
principal establishment (CCR Regulations Section 17014(c)). Domicile requires both physical presence in a particular locality and the intent to make this locality one’s permanent abode.

Residence is any factual place of abode of some permanency that is more than a mere
temporary sojourn. See Whittell v. Franchise Tax Board, 231 Cal.App.2d 278 (1964).
An individual can have only one domicile at any given time, but can have several
residences. See Whittell v. Franchise Tax Board, supra.

The key distinction between domicile and residency is intent. A new domicile is acquired by the actual change of residence in a new place of abode, coupled with the intention to remain there either permanently or indefinitely without any fixed or certain purpose to return to the former place of abode. (Appeal of Robert J. and Kyung Y. Olsen, 1908-SBE-134, October 28, 1980.) A determination of residence cannot be based solely upon the declared intention of the parties, but must have its basis in objective facts. (Appeal of Nathan H. and Julia M. Juran, 1968-SBE-004, January 8, 1968.) In determining residency, voluntary physical presence is a factor of greater significance than the mental intent or outward formalities of ties to another state. See Whittell v. Franchise Tax Board, supra.

Frequently, a person’s domicile and residence are the same physical location. See Whittell v. Franchise Tax Board supra. However, a person’s domicile and residence may not be the same. See the Appeal of Warren L. and Marlys Christianson, 1972-SBE-022, July 31, 1972.

An individual may be a resident although not domiciled in this state and, conversely, may be domiciled in this state without being a resident. (CCR Section 17014 and the Appeal of Terance and Brenda Harrison, 1985-SBE-059, June 25, 1985.)

Keywords: CA FTB Tax Help, CA Residency rules, CA residency audit, CA non residency, CA FTB Audit, CA FTB Appeal
Mike Habib, EA represents individuals and businesses before the State of California in all tax matters. You can reach Mike at 1-877-78-TAXES (877-788-2937).

Having Unfiled Tax Returns and need Help?

Taxpayers with unfiled tax returns can invite a lot of problems. The famous IRS has coined ten years for the collection of taxes that are owed. If the return for owed taxes was filed ten years ago, the IRS will probably use the last address known to them. The government will not be able to maintain any contact if you have already left the country. But if by any chance, you return back within the ten years limit, this can be a big problem. If you start earning or start with any job, it will be very easy for the IRS to contact you and then you are in big trouble. They not only claim the unfiled tax returns but all of the fines interest and penalties that have accrued over the original payment are also asked for. If you have somehow not at all bothered to file the tax returns, it is very important for you to have all the documents necessary to file your tax returns. Having lower income or lots of medical bills will not make any difference. It could simply lead to the conclusion that you probably are left with no money at all to pay for the mortgages or even the regular bills.

If anyone finds himself stuck in such serious circumstances it is strongly suggested that services of an experienced tax relief professional be asked. Only they will be able to guide you properly as to what is required to be done. They will be able to sort through all of the back taxes of past years and negotiate with the IRS to make some reasonable solution. The help of tax relief expert can invite many days of annoyance, severe deadlines or some difficult and confusing forms to be handled on your own. The tax relief specialist, as a professional will do his best to help you deal with the situation and come out of it successfully. He will be spending most of his time to sort out the best interest of the client and find a solution.

The IRS keeps sending reminders to the clients if the tax returns are not filed on time. When unfiled returns become delinquent they will start becoming harsh. In severe cases they can even claim to levy the wages and assets of the taxpayers in the notices. In such situation the first thing that is required is to immediately file for your unfiled tax returns, regardless of the fact that you are not in a position to afford it. If you are unable to find the record of the returns of past years, such as W2’s. 1099’s, a098, etc., you can always count on your tax relief representative to obtain the detailed of your IRS record. There are not many individuals working in this sector and a lot of calls are received at their end, so it is expected that one may have to wait for their representative to get free for you. This may take up to few days in some cases.

By not filing your tax returns in time, the fault is at your part. It is strongly recommended that you should seek proper representation and get your life back in order.

Call today 1-877-78-Taxes (877-788-2937).

We represent taxpayers with back taxes and unfiled tax returns in all of the following states, counties, and metro cities, Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Puerto Rico Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington D.C.. West Virginia Wisconsin Wyoming. AL AK AZ AR CA CO CT DE DC FL GA HI ID IL IN IA KS KY LA ME MD MA MI MN MS MO MT NE NV NH NJ NM NY NC ND OH OK OR PA RI SC SD TN TX UT VT VA WA WV WI WY New York, Los Angeles, Orange County, Riverside, San Bernardino, San Francisco, Ventura, Lancaster, Palmdale, Santa Barbara, Chicago, Washington D. C., Silicon Valley, Philadelphia, Boston, Detroit, Dallas, Houston, Atlanta, Miami, Seattle, Phoenix, Minneapolis, Cleveland, San Diego, St Louis, Denver, San Juan, Tampa, Pittsburgh, Portland, Cincinnati, Sacramento, Kansas City, Milwaukee, Orlando, Indianapolis, San Antonio, Norfolk & VB, Las Vegas, Columbus, Charlotte, New Orleans, Salt Lake City, Greensboro, Austin, Nashville, Providence, Raleigh, Hartford, Buffalo, Memphis, West Palm Beach, Jacksonville, Rochester, Grand Rapids, Reno, Oklahoma City, Louisville, Richmond, Greenville, Dayton, Fresno, Birmingham, Honolulu, Albany, Tucson, Tulsa, Tempe, Syracuse, Omaha, Albuquerque, Knoxville, El Paso, Bakersfield, Allentown, Harrisburg, Scranton, Toledo, Baton Rouge, Youngstown, Springfield, Sarasota, Little Rock, Orlando, McAllen, Stockton, Charleston, Wichita, Mobile, Columbia, Colorado Springs, Fort Wayne, Daytona Beach, Lakeland, Johnson City, Lexington, Augusta, Melbourne, Lancaster, Chattanooga, Des Moines, Kalamazoo, Lansing, Modesto, Fort Myers, Jackson, Boise, Billings, Madison, Spokane, Montgomery, and Pensacola

Back Taxes – How to get tax resolution

When one is undergoing financial problems and above all a number of tax bills that are due, the first thing that crosses ones mind is how to settle back taxes. Burden of tax debt is a complicated issue. This is so because if one does not pay the past due tax bills the amount keeps on doubling with time. Moreover, more interest and penalties are added to it. In the end, the rights of the taxpayer are no longer protected because then the tax collectors start intruding into person’s bank accounts and seizing all the property he has in his name. As each and every move is interlinked with the previous one which makes these back tax debts a complicated one. Thus, there is a dire need to settle back taxes and get peace of mind.

In order to settle tax debt a proper channel is required, that is, a legal tax relief representative such as an experienced Enrolled Agent can do a fine job in corresponding and negotiating with the IRS, or any tax agency. As it is seen, for every problem one needs to discuss the matter openly. Both parties look at their positive and negative points for each alternative resolution. Then a modified tax resolution is formulated which would be acceptable to both parties. This is how to settle back taxes.

Whenever a tax problem occurs both parties are eager for a resolution. Thus, settlement of taxes is easy to come by if negotiation is properly conducted. Once tax bills have piled up the first thing a taxpayer should do is hire a licensed tax relief representative as power of attorney. In the time being, the IRS notifications that the taxpayer is receiving, should not be ignored. It is essential for the taxpayer to keep the IRS informed that he is ready for a reasonable settlement. Otherwise, the time period for settlement would elapse, and major actions will be taken by the IRS like seizing the taxpayer’s property, levying their paycheck and levying all bank accounts. Thus, one should keep this always in mind as to how to settle back taxes because there is always a lot of margin for the taxpayer if one wants to look at it. There are a number of ways to settle back taxes which are as follows:

  • One way for settling IRS back taxes is to ask for a compromise, that is the original amount to be reduced to such which could be acceptable to both parties. The main objective of the taxpayer is to make the tax agency believe that a compromise is necessary otherwise his cost would be more than his savings so with compromised amount more can be paid.
  • Another popular method is of installment agreement. In this a small amount is paid every month on tax, interest and penalty which eventually totals into more bigger the amount with interest but this method is more convenient for taxpayers so they prefer this method.
  • A delay in payment can also be asked in how to settle back taxes. When the notifications are coming to the taxpayer he should respond by writing a letter or fax to the IRS and ask for extended time period for like 60 days. If more time is required the same procedure is followed.

Thus, the problem of back tax can be solved. An experienced Enrolled Agent tax relief professional is of great help during taxpayer representation and handling the settlement deal. Moreover, they can provide the taxpayer with better settlement than they could achieve on their own.

Mike Habib is a tax relief professional, an IRS licensed Enrolled Agent and represent taxpayers regarding back taxes in the following metro areas: Los Angeles, Pasadena, Glendale, Burbank, Orange County, Riverside, Palm Springs, San Bernardino, Palmdale, Bakersfield, New York, New Jersey, Chicago, Houston, Phoenix, Philadelphia, San Antonio, San Diego, Dallas, San Jose, Detroit, Jacksonville, Indianapolis, San Francisco, Columbus, Austin, Memphis, Fort Worth, Baltimore, Charlotte, El Paso, Boston, Seattle, Washington DC, Milwaukee, Denver, Louisville, Jefferson, Las Vegas, Reno, Hempstead, Tucson, Nashville, Davidson, Portland, Tucson, Albuquerque, Santa Fe, Anchorage, Atlanta, Long Beach, Fresno, Sacramento, Mesa, Kansas City, Cleveland, Virginia Beach, Omaha, Miami, Oakland, Tulsa, Honolulu, Minneapolis, Colorado Springs, Arlington, Wichita, Birmingham, Montgomery, Tampa