How it Works

An IRS audit is a formal review of financial information used to verify that the tax return was done accurately. Their purpose is to minimize the tax gap, which is the difference between what the IRS is owed and what was received. Sometimes they are done randomly, while in other cases, taxpayers are selected based on the tax returns’ DIF (Discriminate Function) score. A DIF score is a mathematical technique used to classify income tax returns as to Examination potential. Under this concept, formulas are developed based on available data and are programmed into the computer to classify returns by assigning weights to certain basic return characteristics. These weights are added together to obtain a composite score for each return processed. This score is used to rank the returns in numerical sequence (highest to lowest). The higher the score, the higher the probability of significant tax change. The highest scored returns are made available to Examination upon request.

After you’ve received a notice, you should protect yourself with audit representation. The IRS imposes deadlines in which issues must be resolved to prevent incurring additional fines or penalties. Remember that once the IRS begins an official investigation, any information you report could be potentially self-incriminating. It’s important to note that hiring a professional representation is not an indication that you’ve done something wrong. An IRS audit representative can save you time and stress by handling the endless paperwork. Hiring tax audit representation signifies that you take the audit seriously; it will make the IRS agent’s job easier and lead to a better outcome.

What Reliable Tax Defense can do for you

An IRS audit is a formal review of financial information used to verify that the tax return was done accurately. Their purpose is to minimize the tax gap, which is the difference between what the IRS is owed and what was received. Sometimes they are done randomly, while in other cases, taxpayers are selected based on the tax returns’ DIF (Discriminate Function) score. A DIF score is a mathematical technique used to classify income tax returns as to Examination potential. Under this concept, formulas are developed based on available data and are programmed into the computer to classify returns by assigning weights to certain basic return characteristics. These weights are added together to obtain a composite score for each return processed. This score is used to rank the returns in numerical sequence (highest to lowest). The higher the score, the higher the probability of significant tax change. The highest scored returns are made available to Examination upon request.

After you’ve received a notice, you should protect yourself with audit representation. The IRS imposes deadlines in which issues must be resolved to prevent incurring additional fines or penalties. Remember that once the IRS begins an official investigation, any information you report could be potentially self-incriminating. It’s important to note that hiring a professional representation is not an indication that you’ve done something wrong. An IRS audit representative can save you time and stress by handling the endless paperwork. Hiring tax audit representation signifies that you take the audit seriously; it will make the IRS agent’s job easier and lead to a better outcome.

How it Works

An Installment Agreement is an agreement between the IRS and the taxpayer that enables the taxpayer to pay his or her debt over time (generally 60 – 72 months). There are 4 types of installment agreements under the IRS Fresh Start Program. It is important to note that interest and penalties will continue to accrue even when the taxpayer has entered into an installment agreement.

1. Under $10,000 (Guaranteed, no financials)
2. $10,000 – $25,000 (Streamline, limited financials)
3. $25,000 – $50,000 (Streamline DDIA, limited financials)
4. $50,000 – $250,000 (Full financials, over $250,000 assigned to revenue officer)

What Reliable Tax Defense can do for you

Paying back taxes is never easy, and dealing with the IRS is worse. The type of IRS installment agreement you can qualify for is largely determined by your background. If you’ve made a payment deal with the IRS in the past that didn’t go well, the IRS is less likely to give you another chance.

If you satisfy certain requirements, you may file for Form 9465 to set up a monthly installment plan. Any taxpayer who owes less than $10,000 must have immediately approved the following terms of their installment payment plan application:

• All prior tax returns must have been filed by the taxpayer to apply for this payment plan.
• An installment agreement has not been acquired in the last 5 years.
• Is unable to pay taxes when they are due.
• Should be able to pay the remaining balance within three years.

Resolving tax debt is stressful but we’ll be there to assist you every step of the way. Reliable Tax Defense will make the process of applying for an IRS payment plan as easy and painless as possible!

How it Works

With this resolution option the IRS will consider placing the account in a “hardship” or Currently Not Collectible status. In considering a taxpayer’s account for hardship status, the IRS will compare the taxpayer’s monthly gross income against what it calls “allowable” expenses. IRS monthly allowable expenses are national averages for food, clothing, miscellaneous expenses, housing, transportation, medical expenses, among others. These allowable amounts vary depending on household size and local standards as well. Hardship is a subjective term, and even though a taxpayer’s monthly expenses may exceed IRS allowable amounts, it doesn’t mean that such status will be approved.

Being placed in CNC is generally not a permanent solution to a tax problem unless the taxpayer is older or on a fixed income. A taxpayer that is placed in CNC will have his or her status reviewed every 18-24 months by the IRS to determine if hardship status is still warranted. Generally, if the taxpayer’s AGI (adjusted gross income) increases significantly from the information contained in the application, the IRS will request the taxpayer to update the form to see if he or she can now make monthly payments towards the liability.

Obtaining CNC status can be used strategically if other viable solutions to a tax problem exist. For example, if a taxpayer is close to the Collection Statute Expiration Date (CSED), being put in hardship status for the remainder of that statutory period would result in the relief of those liabilities once the CSED has passed. It is important to note that while in CNC status the IRS will not actively try to collect, except for any refunds. If the taxpayer is due a refund upon filing his or her income tax return, the IRS will keep the refund and apply it towards the debt.

What Reliable Tax Defense can do for you

Here at Reliable Tax Defense, our licensed tax professional will perform a financial analysis and evaluate all the viable options depending on the results. We will discuss the pros and cons of placing you in CNC status. Once we have qualified you for CNC, we will complete all the pertinent paperwork and submit everything required by the IRS. Depending on the amount of the debt, we might be able to get the approval from the IRS right away. Call us now at 1-844-601-8999 or email us at [email protected] to set up your free initial consultation with our licensed tax professional.

How it Works

An Offer in Compromise (OIC) is the most advertised resolution option because the debt may get completely written off depending on the circumstances. However, in order to qualify for an OIC you must show that you are in a genuine state of financial hardship. With the Fresh Start initiative, the IRS has made liberal changes to the OIC program that favors taxpayers. There are 3 different types of OIC options available which are listed below:

1. OIC – Doubt as to Liability – A compromise meets this criteria when there’s a genuine dispute regarding the existence or amount of the correct tax debt under the law. There are often times when both the taxpayer and the IRS doubt the liability. In this circumstance the IRS may accept a compromise. The amount of the offer should be based on what you believe the correct amount of the tax debt should be – not what the taxpayer owes. A statement should be included with supporting documentation explaining why the tax debt or portion of the tax debt is incorrect.
2. OIC – Doubt as to Collectibility – Doubt as to collectibility exists in any case where the taxpayer’s assets and income are less than the full amount of the tax liability. Ultimately, the IRS and the taxpayer settle the debt for less than the amount owed. The IRS will not accept an OIC if they believe the liability can be paid in full as a lump sum or through an installment payment plan.
3. OIC – Effective Tax Administration – This can be a viable option when there’s no doubt that you have legal tax debt and are technically able to pay the full amount, but paying the full amount would create economic hardship due to exceptional circumstances.

Getting an offer in compromise is not easy and the process may take between 1 and 2 years to complete. During the time the offer is being processed, the Statute of Limitation is tolled. You will need to prove your circumstances so the IRS is absolutely certain that you cannot meet your liabilities.

You have two options as to how to settle your Offer in Compromise with the IRS:

1. Lump sum cash offer: you make a down payment of 20% of the agreed repayment, then settle the compromise with 5 or less payments. These payments are non-refundable and must be made while the IRS reviews your offer.
2. Periodic Payment Offer: you will agree to a repayment plan that may well be 24 monthly repayments. You will enclose your first payment in the OIC and must then pay your offer monthly even while the compromise is being considered. These payments are non-refundable, even if the IRS rejects your offer and demands more money.

What Reliable Tax Defense can do for you

Here at Reliable Tax Defense, our licensed tax professional will perform a financial analysis and evaluate all the viable options. We will discuss with you the pros and cons of submitting an OIC. Once we have determined that an OIC is the right choice for you, we will complete all the pertinent paperwork and we will submit everything required by the IRS. This process could take up to two years, during that time we will stay by your side, contacting the IRS and answering any additional requests they might have. Call us now at 1-844-601-8999 or email us at [email protected] to set up your free initial consultation with our licensed tax professional.

How it Works

Under federal law, both spouses are 100% responsible for an income tax return that is filed and signed by both the taxpayer and spouse. However, there are a few exceptions to this rule and the IRS has the power to release a spouse from direct financial liability for unpaid taxes.

The IRS understands that there are some situations in which a spouse cannot be held responsible for mistakes solely attributable to the other spouse. However, innocent spouse relief is very difficult to obtain and granted on a case-by-case basis. They will conduct an assessment of the “innocent” spouse’s education, work experience, relationship status (still married, divorced, or separated), physical or mental disabilities, and level of involvement in household finances to determine whether the spouse can qualify for innocent spouse relief.

What Reliable Tax Defense can do for you

At Reliable Tax Defense, our licensed tax professional can help you with the application process and gathering of all the proper documentation. With our experience and your story, we are able to adequately portray your situation to the IRS in a way that is truthful, compelling, and effective in resolving your case. Call us now at 1-844-601-8999 or email us at [email protected] to set up your free initial consultation with our licensed tax professional.

How it Works

Some people use the words “lien” and “levy” interchangeably, however, they are different. A tax lien is a document filed by the IRS to protect the government’s ability to collect the money you owe. A levy is the forced collection of tax, for example, by seizing money directly out of a bank account or paycheck. The IRS may take ownership of personal or business property when you fail to pay a tax liability. The process begins with a demand for payment. If you don’t pay or reach an agreement within 10 days, a tax lien gives the IRS legal rights to your property.
Assets that the IRS may seize:

• Your bank accounts
• Your real estate, cars, motorcycles, or boat
• Cash value of life insurance
• Your accounts receivable, if you own your business
• Dividends
• Your rental income
• Any collectable items
• Wage garnishment

The IRS will not file a federal tax lien if a taxpayer arranges a guaranteed installment agreement or a streamlined installment agreement. The tax lien can be released if the tax liability is paid or a settlement is reached with the IRS to satisfy the debt. To protect your assets, it is essential to remove tax liens as quickly as possible.

What Reliable Tax Defense can do for you

We understand how hard you have worked to acquire your assets. We also realize the potentially devastating effects of a federal tax lien. Our licensed tax professionals will evaluate all options allowable by law to permanently release or withdraw any liens. When it comes to levies, we can arrange a temporary hold while we determine a more permanent solution for you. Call us now at 1-844-601-8999 or email us at [email protected] to set up your free initial consultation with our licensed tax professional.

How it Works

Did you forget to pay or, worse, file your taxes this year? You may have legitimate grounds for missing the tax deadline, but the IRS will impose tax fines before you get the chance to pay your tax debt in full. Even if you reported and paid on time, you may face penalties for mistakes on your tax return or if your payment was refused.

However, the IRS offers tax penalty reimbursement to those who are unable to pay their taxes due to unforeseen circumstances. Penalty abatement may be an option.
To be eligible for the first-time penalty reduction, you must satisfy the following requirements:

• Over the past 3 tax years previous to earning the penalty, you have no fines or you have not been asked to file a tax return;
• All your required tax returns have been filed, or an extension has been requested by you; and
• You paid the entire amount of your taxes or made plans to pay your tax liability (payment plan)

What Reliable Tax Defense can do for you

We will help you determine whether you are eligible for a penalty abatement. In most cases, a lack of resources is not a valid reason for a waiver. The reasons why you don’t have enough resources, on the other hand, might be sufficient to satisfy the fee waiver requirements.

Our experts will consult with you to see if any of the following factors contributed to your failure to file on time:

• A death in the family
• Natural catastrophe
• Illness
• Divorce
• Prolonged unemployment
• A mistake by the IRS
• Hazards of Litigation
• Statutory Exceptions
• Administrative Waiver

We’ll look at your situation and assist you in gathering and presenting information that shows you paid your taxes on time. Don’t wait another minute to get help. Call us now at 1-844-601-8999 or email us at [email protected] to set up your free initial consultation with our licensed tax professional.

How it Works

All businesses are required to deduct payroll taxes from their employees’ paycheck and submit the withheld tax to the IRS. Failure to comply with these duties can lead to an audit, tax debt, and severe IRS penalties. A payroll tax penalty or the Trust Fund Recovery Penalty (TFRP) is charged when employers do not pay payroll taxes to the IRS. The IRS has the right to penalize you on delinquent payroll tax deposits or filings. Examples of penalties for non-payment of payroll taxes are failure to file, failure to deposit, and failure to pay.

In order to calculate the TFRP, the IRS includes the unpaid income taxes plus the employee’s portion of the withheld FICA taxes. If the IRS finds you to be non-compliant, you will receive an IRS letter regarding the penalty. You can make an appeal within 60 days from the date on the letter. If you don’t respond to the letter, the IRS will send you a Notice and Demand for Payment, then may initiate collection actions.

If you owe payroll taxes you need to take immediate action to resolve it, as owing payroll taxes can put your business at risk. In order to resolve your payroll tax debt, you may use a payment plan such as an Installment Agreement. If the IRS determines that you were responsible and willful for not paying the payroll taxes as they became due, they have the right to go after your personal assets and your case could become a criminal case.

What Reliable Tax Defense can do for you

You shouldn’t live in fear that your business and assets will be seized. If you haven’t paid your payroll debts, then our professionals at Reliable Tax Defense are glad to help you negotiate a deal and represent you before with the IRS. We can properly prepare your IRS Form 941 and 940 returns and remit your returns. We will assess your payroll tax debt, then provide a case review explaining your payroll tax debt issue. Call us now at 1-844-601-8999 or email us at [email protected] to set up your free initial consultation with our licensed tax professional.

How it Works

If you have a significant debt or tax arrearage you may be considering bankruptcy as a way to start again. When it comes to bankruptcy, you may be unsure of the process, limitations, or whether income taxes can be discharged through bankruptcy.

Many people seem to believe that tax debt will never go away or can be discharged in bankruptcy. This is not entirely true, as at least some taxes can be discharged.

The two most common types of taxes that individuals are assessed with are income taxes and trust fund (payroll) taxes. Trust fund taxes cannot be discharged. These kinds of taxes mostly apply to business owners. They are taxes that are collected from a third party to be paid over to someone else (for example, the government). For instance, when an employer withholds income tax and FICA taxes from an employee, these taxes are supposed to then be paid to the U.S. Treasury. In essence, the employer holds the money in trust to be paid over to the government. The same is true of sales taxes and other state non-income taxes. If the taxes are not paid to the government, the individual business owner is often assessed for these taxes, but they are not dischargeable in bankruptcy by either the owner or the business.

A liability for income (and some other excise taxes) can be discharged in bankruptcy if all of the following conditions are met:

1. Three-Year Rule: The tax year in question is one for which the return was last due, including extensions, more than 3 years before the filing date of the bankruptcy petition. The 3 year period is computed from the most recent date of the tax return due for the tax year (typically April 15 of the year following the taxable year).
2. Two-Year Rule: A tax return has been filed by the debtor/taxpayer or the tax year(s) in question are at least more than 2 years preceding the filing date of the bankruptcy petition. Even when no tax return is filed, the tax may still be dischargeable in a Chapter 13.

What Reliable Tax Defense can do for you

Our licensed tax professional will evaluate all your IRS liabilities and will discuss with you which ones are dischargeable in bankruptcy and which one are not. We will also help you strategize to see if bankruptcy is your best alternative in order to resolve your IRS debt. Call us now at 1-844-601-8999 or email us at [email protected] to set up your free initial consultation with our licensed tax professional.

How it Works

The Freedom of Information Act gives citizens the power to know exactly what the IRS finds problematic with their tax returns on file so the taxpayer can plan better strategies for tax relief. There are limits as to what information may be requested, and proper procedures must be followed. Any information requests that conflict in any way with the public interest or violates the right to privacy of other citizens will not be fulfilled.
A FOIA request is particularly helpful in cases where criminal proceedings are underway because there may be hidden information that will help defend your case. Since criminal proceedings only take place in severe cases, a well-crafted FOIA request could potentially save an innocent taxpayer from being wrongly prosecuted.

What Reliable Tax Defense Can Do For You

At Reliable Tax Defense we will create and submit the FOIA request to the IRS on your behalf. Once the request is approved and the documentation is provided by the IRS, our licensed tax professional will review each and every page received in order to find any and all information that may help us resolve the case in your favor. Call us now at 1-844-601-8999 or email us at [email protected] to set up your free initial consultation with our licensed tax professional.

How it Works

Most state taxing authorities follow the same general guidelines as the IRS for resolving tax debt. The first step is compliance. File your missing/required tax returns, and make sure your current taxes are paid in full. Next, negotiate the resolution of your back taxes. However, you must keep in mind that each state may have more than one taxing authority with different rules.

What Reliable Tax Defense Can Do For You

Our licensed tax professional will contact your state taxing authorities and to make sure that you are in compliance. We then analyze the state’s resolution options to determine what works best for your situation. Call us now at 1-844-601-8999 or email us at [email protected] to set up your free initial consultation with our licensed tax professional.

How it Works

A Statute of Limitation is a time period established by law to review, analyze and resolve taxpayer and/or IRS tax related issues. The Internal Revenue Code (IRC) requires that the IRS will assess, refund, credit and collect taxes within a specified time period; otherwise, these actions are prohibited. This means that the IRS has a certain amount of time to assess the tax or to file a protest by initiating a suit in court against the taxpayer.

What Reliable Tax Defense Can Do For You

Here at Reliable Tax Defense, we always review our clients’ transcript and analyze the statute of limitation prior to suggesting a resolution option available to our clients. We will request the appropriate transcript from the IRS and we will recalculate all the dates. Believe it or not, the IRS makes mistakes. Our job is to find any errors and help our clients explore all their options. Call us now at 1-844-601-8999 or email us at [email protected] to set up your free initial consultation with our licensed tax professional.