Tuesday, July 15, 2008

How To Address IRS Tax Problems

As the deadline for filing taxes draws ever nearer, many people are plagued with IRS tax problems. IRS issues can be costly, complicated, and overwhelming, from excessive tax debt to surprise penalties. The IRS has an army of employees eager to get your money. Having some basic tax knowledge and the assistance of a Tax Specialist, you can safeguard your earnings by escaping harsh fees.

Be aware that you're not alone if you're faced with IRS tax problems. Each year, thousands of Americans are not able to settle their taxes on time or get notice of a problem from the IRS. Usually, the IRS is the one at fault and fails to give correct information on your rights as a taxpayer. You have to be persistent and informed when dealing with the IRS. You can pursue the course of action that is in your best interest if you are informed of your options and you know your rights.

A common tax issue is not being able to pay your taxes on time, resulting in excessive penalties and interest. Using Form 4868, you can file for an extension and explain why you cannot settle the taxes. In a financial crisis, the Form 9465 can be used to negotiate an Installment Agreement. With this, the IRS will not be able to enforce property seizure, wage garnishment, and other drastic measures.

Another common issue met by those dealing with IRS tax problems is incurring penalties added to your tax bill. Penalties can be imposed on taxes already settled, and the IRS can charge you at will with over 140 penalties. Between 10-100% of the owed amount is the range of penalties. The IRS assesses penalties for a score of reasons, including mistakes on tax returns, filing late, and settling late. Fortunately, there are several options for avoiding penalty fees.

The simplest and least stressful method for handling IRS tax issues is to employ the assistance of a Tax Specialist. These are people knowledgeable in the complicated details of tax law and the numerous loopholes existing in it. A Tax Specialist could be an accountant, a lawyer, or even an ex-IRS officer. Look online for a Tax Services Specialist in your locality, making sure to check their credentials and experience prior to scheduling a meeting.

If you get penalties by not reporting income or filing or settling taxes late, you can request a Penalty Abatement. Documented circumstances like a death in the family, hospitalization, or a natural disaster are valid excuses. You can file a Penalty Abatement request on your own or with the help of a Tax Specialist at the IRS Service Center in your area. Address it to the Penalty Abatement Coordinator, attach documentation such as a death certificate, doctor's letter, or insurance statement, and attach a copy of the IRS penalty notice. It is simpler to handle your tax problems if you know your rights.

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