IRS Tax Lien, How to release federal tax liens and levies

December 21, 2009 | Mike Habib, EA

IRS Tax Lien – How to release federal tax liens and levies

Taxpayers have the right to appeal the IRS’ filing of a notice of a tax lien in the public record and petition for release. If filed in error, the IRS must release the lien and state that the lien was erroneous. The request for tax relief must be based on one of the following grounds: (1) the tax liability had been satisfied before the lien was filed; (2) the assessing of the tax liability violated either the notice of deficiency procedures or the Bankruptcy Code; or (3) the limitations period for collecting the liability had expired prior to the filing of the lien.

The IRS may withdraw a tax lien before payment in full if:

IRS enforcement figures

December 17, 2009 | Mike Habib, EA

Table 16. Delinquent Collection Activities, Fiscal Years 2005-2008

[Money amounts are in thousands of dollars.]

Activity

2005

2006

2007

2008

(1)

(2)

(3)

(4)

Returns filed with additional tax due:

Total amount collected [1]

[r] 27,615,348

[r] 29,172,915

[r] 31,952,399

28,465,648

Taxpayer delinquent accounts (thousands):

Number in beginning inventory

5,981

6,478

7,074

8,240

Number of new accounts

5,870

6,100

7,146

7,099

Number of accounts closed

5,373

5,504

5,980

6,107

Ending inventory:

Number

6,478

7,074

8,240

9,232

Balance of assessed tax, penalties, and interest [2]

57,594,901

69,555,590

83,488,988

94,357,717

Returns not filed timely:

Delinquent return activity:

Net amount assessed [3]

22,765,462

23,305,535

30,287,802

24,888,918

Amount collected with delinquent returns

3,584,255

3,905,764

3,968,163

3,773,528

Taxpayer delinquency investigations (thousands) [4]:

Number in beginning inventory

3,022

3,658

3,874

3,732

Number of new investigations

2,558

2,373

2,587

1,972

Number of investigations closed

1,922

2,157

2,729

2,271

Number in ending inventory

3,658

3,874

3,732

3,433

Offers in compromise (thousands) [5]:

Number of offers received

74

59

46

44

Number of offers accepted

19

15

12

11

Amount of offers accepted

325,640

283,746

228,975

200,103

Enforcement activity:

Number of notices of Federal tax liens filed

522,887

629,813

683,659

768,168

Number of notices of levy served on third parties

2,743,577

3,742,276

3,757,190

2,631,038

Number of seizures

512

590

676

610

[r]–Revised.

[1] Includes previously unpaid taxes on returns filed plus assessed and accrued penalties and interest. For Fiscal Year 2008, includes a total of $37,254,116 (dollars) collected by private debt collection agencies.

[2] Includes assessed penalties and interest but excludes any accrued penalties and interest. Assessed penalties and interest—usually determined simultaneously with the unpaid balance of tax—are computed on the unpaid balance of tax from the due date of the return to the date of assessment. Penalties and interest continue to accrue (accrued penalties and interest) after the date of assessment until the taxpayer’s balance is paid in full.

[3] Net assessment of tax, penalty, and interest amounts (less prepaid credits, withholding, and estimated tax payments) on delinquent tax returns secured by Collection activity.

[4] A delinquency investigation is opened when a taxpayer does not respond to an IRS notice of a delinquent return.

[5] An offer in compromise (OIC) is a binding agreement between a taxpayer and the IRS that settles the taxpayer’s tax liabilities for less than the full amount owed. An OIC will not be accepted if the IRS believes the liability can be paid in full as a lump sum or through a payment agreement.

NOTES: Detail may not add to totals because of rounding. All amounts are in current dollars.

SOURCE: Small Business/Self-Employed, Collection Planning and Analysis, Collection National Reports SE:S:C:PA:CNR

Extended homebuyer tax credit

November 11, 2009 | Mike Habib, EA

Extended and liberalized homebuyer tax credit rules

Mike Habib, EA

On November 6, the President signed into law H.R. 3548, the ”Worker, Homeownership, and Business Assistance Act of 2009.” The new law extends and generally liberalizes the tax credit for first-time homebuyers, making it a much more flexible tax-saving tool. It also includes some crackdowns designed to prevent abuse of the credit. These important changes could it make it easier for you or someone in your family to buy a home. And because the changes generally aid buyers and aim to improve residential real estate markets nationwide, they also could make it easier for you or someone in your family to sell a home. This Client Letter fills you in on the details you need to know about the first-time homebuyer credit.

Year-end tax planning letter

October 29, 2009 | Mike Habib, EA

Year-end tax planning letter

Mike Habib, EA

As year-end approaches, taxpayers generally are faced with a number of choices that can save taxes this year, next year or both years. Employees too are faced with these choices. However, employees have some special considerations to take into account that retirees and other nonworking individuals don’t face. To help our clients who are employees take advantage of these special tax saving opportunities, we have put together a list of items to consider.

Tax debt help

October 19, 2009 | Mike Habib, EA

Tax debt help

Mike Habib, EA

877-788-2937

Tax Relief Second Opinion

September 18, 2009 | Mike Habib, EA

Thinking of hiring a $5000 tax attorney?

HOLD IT.

If you do not qualify for an IRS Offer in Compromise, an attorney CANNOT help you.

Back taxes shutters CA Restaurant

September 18, 2009 | Mike Habib, EA

Back taxes shutters Jack in the Box

Source: Mercury-Register

A state tax dispute is behind the sudden Jack in the Box closures Thursday.

Tax Crack Down on CASH ECONOMY

July 18, 2009 | Mike Habib, EA

Hawaii Cash Economy Enforcement Act of 2009

On June 18, 2009, Governor Linda Lingle signed Senate Bill 972 SD2, HD1, CD1 into law as Act 134, the “Cash Economy Enforcement Act of 2009.”

This Act provides the department with additional resources and tools to target high-risk, cash-based transactions to shore up confidence in Hawaii’s tax system. In this regard, this measure ensures that all sectors of Hawaii’s economy, including those prone to substantial underreporting, are paying their fair share of taxes.

This Act focuses on the civil collection and enforcement nature of Hawaii’s tax laws, by establishing the Special Enforcement Section, a group of tax officials charged with handling sensitive and high-risk civil tax cases as directed by the director. This Act also provides various enforcement tools, including the authority to issue monetary fines and cease and desist citations.

IRS List of Interest

July 17, 2009 | Mike Habib, EA

IRS Releases List of Transactions of Interest (Notice 2009-55)

The IRS has provided a list of transactions that have been identified by the Service as “transactions of interest.” The IRS will consider transactions similar to any of the transactions on the list to be transactions of interest for purposes of Code Secs. 6111, 6112, 6662A, 6707, 6707A and 6708, and Reg. §1.6011-4(b)(6).

One transaction of interest (initially identified in Notice 2007-72, 2007-2 CB 544) involves taxpayers who purchase a remainder interest or similar successor member interest directly or indirectly in real property and then transfer such interest to a tax-exempt organization, claiming a charitable contribution deduction significantly higher than the amount paid for the interest. The Treasury and the IRS are concerned that taxpayers may be utilizing the contribution of such successor member interests to generate an excessive deduction.

Oregon Tax Amnesty

July 17, 2009 | Mike Habib, EA

Oregon: Tax Amnesty Program Enacted

Gov. Ted Kulongoski has signed legislation that authorizes the Oregon Department of Revenue (DOR) to initiate a tax amnesty program for taxpayers subject to the corporation excise (income) tax, the personal income tax, the inheritance tax, and the mass transit district tax on self-employment. The program will begin on October 1, 2009, and end on November 19, 2009, and applies to tax years, reporting periods, and estates for which the DOR could issue a notice of deficiency under ORS 305.265 or ORS 314.410, as amended and in effect on September 27, 2009.

To qualify for participation in the program, a taxpayer must have been required to:

file an income tax return for a tax year prior to 2008;
pay income tax for a tax year prior to 2008;
file an inheritance tax return and pay any required tax if the return was due before 2008; or
pay the mass transit tax on self-employment, if required to do so, before 2008.

A taxpayer may not participate in the tax amnesty program if the OR DOR issued a notice of deficiency before the start of the program or assessed a tax for a tax year for which the taxpayer could otherwise apply for amnesty. However, a taxpayer who has filed a bankruptcy petition may participate in the program if the taxpayer submits an order from the bankruptcy court allowing participation.