Author: 20/20 Tax Resolution

Tax Tip: Top Things To Know When You Owe

It’s what most every taxpayer dreads: Despite your best efforts, you find yourself owing money to the Internal Revenue Service with an inability to pay the debt immediately. In addition to feeling stressed about the money you owe, you’re concerned with the consequences of delaying payment and what this might mean for your finances or your business. In addition, you’ve started to worry about actions the IRS might begin to take to ensure payment.

Our first piece of advice: Don’t panic. Take a minute to breathe and understand that you’re not the only person experiencing this problem. Thousands of U.S. taxpayers each year find themselves in similar circumstances. You’re not alone.

Our second piece of advice is to address the problem head on. Don’t ignore the notices you receive from the IRS, and don’t bury your head in the sand wishing this problem would just go away. It won’t – at least not without your attention.

At 20/20 Tax Resolution, we hear from folks just like you all the time. We understand the fear and frustration that comes with tax difficulties. In addition to staying calm and addressing the problem, here are some other things you should know when facing this challenge:

The IRS wants to work with you. Believe it or not, the IRS is not out to “get” you. Although the agency has some pretty powerful methods it can use to ensure payment, it typically saves such aggressive measures for taxpayers who ignore IRS communications or refuse to take steps toward a resolution. Enforcement actions like bank levies, accounts receivables levies, wage garnishments and asset seizures are rare and used typically as a last resort. By acknowledging the problem and working to make good on the debt, you won’t be subjected to these extreme actions. Plus, 20/20 has a variety of tools we can use to intercede and ensure that these extreme IRS actions are avoided.

Communicating with the IRS can be difficult. It’s no secret that working with any government agency can be challenging and time consuming. In the case of the IRS, the challenge is exasperated by the agency’s lack of adequate funding and personnel. If you are “going it alone,” be prepared to spend inordinate amounts of time, effort and frustration tracking down the right person to help you, waiting on hold for information and then deciphering the meaning behind complex tax policies and procedures. In order to alleviate these headaches, work with a qualified tax resolution provider. Since we work with the IRS on a regular basis, 20/20 is very familiar with the agency’s communications processes, and we know how to reach the right person to get the right information.

Delaying and avoiding the issue can cost you. As we mentioned previously, the IRS really does want to work with delinquent taxpayers. However, delaying moving forward with a problem (or attempting to avoid the issue altogether) will result in more interest and penalties accumulating on your total debt. When faced with taxpayer inaction, the IRS can become quite aggressive. It’s in your best interest to avoid any delay and begin working toward a settlement or payment process right away. Doing something is always better than doing nothing.

Your chances of a better outcome increase when working with a tax resolution pro. For a variety of reasons, some taxpayers opt to navigate the IRS system on their own. Many times, they’re concerned about their privacy, are ashamed to share the details with a stranger or just feel confident they can manage everything themselves. If this sounds like you, go back and re-read this article for all the reasons you should change your mind. Plus, here’s one more: Working with a qualified Enrolled Agent can reward you in several ways. Not only will your hassles, worry and frustrations be reduced, but in many cases your settlement or financial outcome will be better, too. In the case of submitting an Offer in Compromise, working with a tax resolution professional that’s familiar with the process and knows all requirements will significantly increase your chances of winning approval.

While reactions to owing the IRS can vary, it’s fairly typical for taxpayers to feel some level of worry and concern. However, understanding the above issues can help ease the minds of those in this worrisome situation. Above all else, remember that you’re not alone, and that owing the IRS is not a moral failure. Running a business and a family household (or both) can be difficult – and no one can expect everything to go smoothly all the time. At 20/20 we understand this, and we can help.

20/20: Our Most Unusual Cases

From keeping Alaskans connected to saving Christmas, 20/20’s work goes well beyond dollars and cents

Over the past two decades, 20/20 Tax Resolution agents have seen and heard just about everything. Clients come to us because they’re facing devastating setbacks, financial missteps or stumbling business ventures. Our job, however, is not to judge the circumstances of these clients. It’s to help them find a way back to their productive, satisfying and happy lives. In the process of doing our work, we’ll go to great lengths to help clients reach their goal. Our innovative agents are accustomed to going the extra mile, leaving no stone unturned and fighting for the best resolution.

The following are just a few of our most unusual cases from the past 20 years:

The Doubter

You know you’ve done something right when your client is in such disbelief that he asks to call the IRS to confirm the outcome you’ve achieved.

“This client owed around $63,000,” said 20/20 Agent Alberto Douriet, E.A. “After reviewing his file, we found a settlement would have been around $10,000. He wanted an Offer In Compromise (OIC).”

Not bad, Alberto thought. But he suspected there could be a better resolution in a payment plan. Here’s why: Little did the client know, the Collection Statute Expiration Dates were scheduled to expire in nine months. Alberto explained to the client he could pay the $10K with an OIC, or pay a mere $125 a month for nine months until the expiration (a total of only $1,125). Of course, the client jumped at the chance to so dramatically reduce his costs.

“The first few times the client and I spoke, he was set on an OIC and didn’t want to talk about anything else,” Alberto said. “He was a very “hands on” individual, so I sent him information about CSEDs and encouraged him to do his own research on these matters to gain his trust, which I quickly did. Once it was all over, he was in shock.”

Saved From An Embezzler

What do you do when the CFO of your company embezzles more than a million dollars? Throw in the towel and move on, right? Not in the case of an enterprising client from 20/20 Agent Gabe Leap, E.A.

“This case was strange and unusual in that the proprietor of the existing business had nothing to do with the tax liability,” Gabe said.

Not only had a scoundrel embezzled money, but he liquidated the retirement accounts of employees. Without expert intervention, the company’s dedicated workers would be left high and dry – and without a job.

“The taxpayer only took it over in an attempt to keep the business operating so he and his fellow employees would have a place to work,” Gabe said.

A noble cause, indeed. But one fraught with a lot of headaches and risk – not the least of which was potential prosecution from law enforcement. Fortunately, Gabe and his team were able to deflect any charges and de-fuse the situation – and in the end people’s jobs were saved.

“We had to negotiate stays of collections and bring the FBI and the Department of Labor,” Gabe said. “We were able to legitimize the claim to the taxing authorities that the theft was the reason for the accrual.”

Saving A Necessary Service

When you live in a remote area, you’re often at the mercy of Mother Nature and challenging logistics. It’s not always easy to do simple things – and basic needs must be constantly replenished, often from far-off locations. So an airline delivery service that provides necessary goods and services is a critical need.

“Our client was an aviation company that flew critical flights to service remote parts of this state with goods and services,” said 20/20 Agent Joe Cunningham, E.A. “The client flew for the U.S. Postal Service, the FBI and local law enforcement, among other organizations.”

But when tax issues threatened to ground the planes, 20/20 was able to work with an alphabet soup list of government entities and mechanisms to keep pilots (and packages) in the air. All told, the 20/20 team’s efforts to save the company involved coordinating with the United States Postal Service (USPS), the Federal Aviation Administration (FAA), the FMS Division of Treasury, the IRS and others to save the airline.

Cunningham and his team used a variety of mechanisms to resolve the airline’s financial woes.

“We saved their company,” Joe said, “and kept this service available to residents.”

Senior Security

Even the U.S. Government can have a heart sometimes. That turned out to be just the case for one of 20/20 Agent Tiffani Million’s clients. Tiffani’s client, a 71-year-old graphic designer, lived off his Social Security earnings and made a very limited amount of extra money through his small graphic design business.

“His business generated very little income and it possessed assets with little to no value,” Tiffani said. “Personally, he had one used vehicle and possessed no other assets with equity.  After he paid all of his monthly expenses, he didn’t have much left to live off of at the end of the month.”

Unfortunately, he owed back taxes of more than $84,000 – a sum he could never even consider hoping to pay. Tiffani recognized his situation was untenable, and performed what some might say was a miracle.

“I submitted an Offer in Compromise on the taxpayer’s behalf for $1, because of his extreme circumstances,” she said. “And the Internal Revenue Service accepted!”

Helping A Client Move Forward

It was a “Catch 22” type of situation for one of 20/20 Agent Sam Million’s clients. The client couldn’t pay her taxes because of lack of work, and she couldn’t land a steady job because of a federal tax lien on her credit report. What’s more, she was facing a $40,000 tax liability.

“The client had been mostly unemployed for several years with the occasional contracting position that would last one to three months,” Sam said. “We had tried several different methods of resolution, including an Offer in Compromise on her $40,000 tax liability. When we finally had an examiner agree to give a settlement of $6,000 the client had no current income and couldn’t afford the repayment.”

It seemed she was doomed to failure no matter what she did. But Sam didn’t give up hope. He understood that a clean credit report could help the client in her pursuit of full-time work – and the federal tax lien was preventing that from happening.

“After several months we decided to pursue a withdrawal of the federal tax lien so she could then qualify for a more long-term job position,” he said. “We had never requested a lien withdrawal with no resolution in place or tax liability being full paid. But we rolled the dice and submitted a request for the lien to be withdrawn so that the taxpayer could qualify for job opportunities and an income that would help her sustain a repayment plan to the IRS.”

The IRS Technical Advisor agreed to this, and issued a withdrawal of the federal tax lien, Sam said. In addition, the 20/20 team was able to negotiate a first-time abatement on the liability, reducing the client’s debt by roughly $6,000.

Saving Christmas for 100 families

Think of this scenario: The IRS issues a hefty levy against your construction company. It’s five days before Christmas. The $1.7 million liability is just $100,000 shy of your total business bank account. You’re forced to tell employees they won’t be receiving their expected regular paycheck right before the holiday.

Although he didn’t sport a white beard and a jolly red suit, 20/20 Agent Mike Ranalli may as well have swept in on a one-horse open sleigh when he told the business owner he had secured a release of the $1.7 million levy just prior to Dec. 25th.

“We were able to get the entire levy released through procedural wizardry,” said Mike. “As a result, the business was able to pay the company’s more than 100 employees. The night we told him about the funds release, our client said that he went home and downed a mug of vodka. No ice. No mixer. Just a mug of vodka. Whew!”

20/20 Success Story: Douglas

Tough times and tough decisions forced couple into bankruptcy, losing their business and leaving them with hundreds of thousands in unpaid tax debt.

Situation:

As any business owner will attest, managing a company can be a delicate balancing act. During prosperous times, it’s easier to keep a steady ship. But when challenges arise, difficult decisions made under duress can come back to haunt you.

That’s a business lesson not unfamiliar to Douglas Smith and his wife, Dana. The one-time co-owners of an ambulance service provider had managed their successful business for many years until tough times forced the couple to make arduous economic choices. Squeezed between paying employee salaries and keeping current on all tax obligations, the couple chose the former – thinking they would “catch up” when financial pressures eased. However, as interest and penalties accumulated, the unpaid taxes became a hurdle too big to overcome. Forced into bankruptcy and struggling to pay bills and keep the company, the Smiths were distressed and disillusioned.

“There were some extraordinarily dark times,” recalled Doug Smith. “It certainly wasn’t the most joyous of times or the most anticipated of consequences.”

Analyzing Business Data - pen and numbers on paper

The Problem:

In the case of the Smiths and their business operations, there were actually multiple problems – all requiring attention at once. But perhaps the most pressing issue was the constant pressure from the IRS to settle the matter. Faced with a struggling business and a tax bill reaching “hundreds of thousands” of dollars, the Smiths were under an increasing amount of stress both at work and at home.

“You still have to pay your bills,” Doug said. “You still have to try to make your business work. We were still running the company trying to get a contract so we could get out of this mess. It was not good times.”

“There was a lot of stress. A lot of emotion,” Dana added. “We saw a lot of tears.”

With such a large amount of money owed and no way to pay it, the Smiths were becoming concerned about the potential consequences, including the fear that jail time might be a possibility.

“I don’t really know if it was a possibility but we’d heard stories,” Doug said. “Certainly with over a hundred thousand dollars at stake, I’m not sure how forgiving a prosecuting attorney would be if it had ever gotten to that point.”

Fortunately, it never did.

The Solution:

With the recognition that their tax troubles were only getting worse – and a desire to move forward with their lives in a positive way – the Smiths decided that professional help was in order. Disappointed by the lack of support they were finding in their community, the couple was understandably wary of seeking outside help. Yet, the Smiths needed help from someone familiar with, and adept at, solving the tax problem they were facing. Fortunately, 20/20 Tax Resolution possessed the exact experience the couple required.

“I did research online just to look for relief,” Doug said. “When I checked 20/20 Tax Resolution, I also checked their Better Business Bureau rating and decided they were the ones I wanted to call.”

Satisfied with 20/20’s BBB, the Smiths contacted the firm and were quickly blown away by the attention to detail and responsiveness of their 20/20 representative.

“They were very understanding and very clear on what we needed,” Doug said. “We were moving forward and making good progress when my bankruptcy came back to throw a bump in the road.”

During the process of finalizing an Offer in Compromise (OIC) with the IRS, it was determined that the Smith’s bankruptcy filing had not been “fully discharged” – which means the couple possessed remaining assets not considered in the OIC. (An OIC allows qualified individuals with an unpaid tax debt to negotiate a settled amount that is less than the total owed.) As a result, the original OIC was returned, but Doug said that 20/20’s commitment to resolving their issue never wavered.

“They were diligent, caring and showed the highest integrity,” he said. “My case took a few curves and hit some bumps along the way, but all were masterfully handled by them. I have nothing but the greatest of praise and highest recommendation for anyone needing 20/20’s tax resolution services.”

After a very long process, a new OIC was secured for the Smiths which effectively reduced their debt to a fraction of the couple’s original tax debt. (You can view the actual OIC here.) For the first time, the Smiths could see a light at the end of their very long, dark tunnel.

“For anyone going through this, I would say find a very good advocate for yourself,” Doug said. “I believe I found an excellent advocate at 20/20. My team was worth a million bucks. They were there whenever I had an issue. Sam Million and his assistant, John Casanova (the Smith’s 20/20 team) were exquisitely talented in helping with my case and understanding the stress I felt throughout the case. Thanks to their efforts our life has improved considerably.”

In fact, Dana said the assistance of 20/20 may just have saved the couple’s marriage. Today, the Smith’s are “starting over” and rebuilding their lives free of the worry and burden that overtook their lives for nearly six years. If everything works according to plan, the couple will purchase a new home this year – something unimaginable just a few short months ago.

20/20 Success Story: John

Facing tens of thousands in owed back taxes, Texas man turned to 20/20 Tax Resolution and discovered the meaning of sweet redemption

Situation:

John Mohan lived his life on the edge – but without ever realizing it. An electrician by trade in the small Texas town of Alvin (located about 40 miles south of Houston), John worked as an independent contractor for many years and never bothered to file a tax return for any of his contracting income. It wasn’t a conscious decision to disregard a responsibility, but more of an oversight that over time became an “outta sight, outta mind” kind of habit. Similar to others in the construction industry, John worked a variety of jobs over the years, ranging from electrician to carpenter. But when John took a job with a larger company that withheld taxes from each paycheck, the Internal Revenue Service took notice.

“I received a letter saying that I owed $4,000,” John, 53, said. “So I assumed that’s all they wanted and I went in to the IRS to try and finance that $4,000. That’s when they said ‘Wait, that’s $4,000 for ONE year.’ They wanted immediate filings for the last six or seven years.”

Man holding blue helmet close up

The Problem:

Like so many in the construction industry, John hadn’t kept meticulous records of his past earnings. He couldn’t afford to hire an accountant to help him go back nearly a decade and determine all the revenue he had earned and how to file his back returns. He was, in his own language, “devastated.” And the IRS was breathing down his neck.

“I wanted to just quit my job,” he said. “The IRS was threatening to garnish my wages right off the bat. I’ve heard horror stories about people going through this and I just had no idea what I was going to do. I had no idea where to even begin with something like that.”

John left the IRS office that day feeling sad, depressed and “all alone.” He knew he could be facing an insurmountable amount of back taxes and penalties. Losing sleep and worried about his economic future, John owed nearly $45,000 in back taxes spanning multiple years.

The Solution:

In what could be called an amazing coincidence, John returned home from the IRS to find a letter in his mailbox from 20/20 Tax Resolution. He had never heard of the Colorado-based firm with more than two decades of experience helping people just like him.  The letter arrived at the perfect time for John to take action.

“That really got the ball started,” John said. “Just contacting 20/20 really started to emotionally put me at ease.”

From the very onset of working together, 20/20 was able to remove the fear, worry and unrest John was constantly feeling about his tax situation. An aggressive IRS was sending John threatening letters and communicating ultimatums John wasn’t able to fully understand.

“They said don’t worry about it, just send the letters to us,” John said. “Every time I got a letter, I would pick up the phone immediately and call 20/20.”

That attention and compassionate assistance made a world of difference to John. He was able to better focus on his work and life – and remove the doubts and concerns from his mind. He was a bit concerned at the outset that 20/20 was located in Colorado while he lived in Texas. But those worries were quickly displaced by gratitude.

“I actually forgot about the whole situation a lot of times,” he said. “20/20 was just great. Those people are awesome. They even worked with me on creating a payment plan for the cost to resolve my situation.”

In the end, John received the greatest news of all: 20/20 was able to successfully negotiate an Offer in Compromise for John with a settlement of only $234! Although he’s still in the process of getting liens removed and he will need to stay on top of future tax obligations, John feels 20/20 helped him dodge a bullet that would have hampered his life for many, many years.

“I feel very blessed that I called 20/20,” John said. “I’d recommend anyone who has any tax problem at all to call 20/20. They are outstanding people.”

Tax Tip: What to do post resolution

Whew! You made it through to the other side! Congratulations on navigating the difficult maze of regulations, processes and emotions to successfully finalize a resolution to your tax problems. Time to relax, forget about the past and move on to a better future, right?

Well, not exactly. During 20/20’s two decades of working with clients, we’ve seen the pitfalls that can await taxpayers on the other side of the resolution process. We strongly advocate that our clients create a “post-resolution plan” to help them steer clear of future problems. Without a thoughtful approach to your new reality, the chances of needing additional help down the road increases.

The first step is to make certain you understand all aspects of your resolution, any payment plan that may be in place, the expected duration of the plan and – perhaps most important – how you will pay it. Don’t wait until your first payment is due to fully comprehend everything you agreed to in the resolution. Delaying this step is what typically leads to a first mistake: missing a payment (something you don’t want to do).

To avoid missing any payment deadlines, consider scheduling a direct deposit. If you choose to use traditional U.S. mail for your payments, remember that each payment must be received by the actual due date. Unlike filing a tax return, payments are not considered to be on time by their postmark. If you opt for snail mail, make certain to leave enough time for the post office to punctually deliver the payment.

A lot of managing your resolution just comes down to staying on top of it and identifying problems before they occur. At 20/20, we have been very successful at setting up manageable resolutions for clients for 20 years. We’ve found that very often, the root cause of problems can be traced back to a taxpayer’s individual habits, business practices or organizational skills.

While some businesses struggle to stay current due to genuine financial hardship, we often see business owners and officers neglect to establish effective business practices. One of the most effective ways to ensure compliance is to engage the services of a payroll firm. At 20/20, we partner with payroll and sales tax solutions in order to assist our clients in developing good and effective business practices. It’s important to make an honest assessment of your business and lifestyle to see if these solutions are right for you and your company.

Ask yourself the tough questions: Is your business undercapitalized? Are you overspending? Are there lifestyle changes you should consider to help keep you on better financial track? All of these are important considerations to study to keep you moving forward and avoid future tax problems.

Light at the end of the TunnelFinally, now that you have what probably feels like a new lease on life, don’t take it for granted. Keep vigilant on your resolution and be proactive if and when you have any problems surrounding the payment terms. Remember that communication is key to staving off future issues with the IRS or other tax authorities. Don’t hesitate to speak up when problems arise.

If you’re still concerned about the ability to successfully manage your resolution and steer clear of future problems, 20/20 offers a monitoring program called POA+. POA+ is a monthly, pay-as-you-go service that allows 20/20 to maintain an active role in your tax resolution plan. Our team will be able to receive and monitor notices from the taxing authorities to promptly address issues that arise as well as remain available to answer questions.

However you proceed, enjoy the relief that comes from knowing you are managing your tax obligations and taking the best care of your business. And be certain to stay on top of your resolution requirements! If things ever get out of hand again, remember that 20/20 is here to help.

Fight Back Against Scams

It’s tax season, which means that tax scams are on the rise. It’s likely you – or someone you know – has received a suspicious email, phone call or even snail mail and wondered “can this be real?” If you answered “no,” congratulations! You just saved yourself a mess and headache. But unfortunately, thousands of Americans lose millions of dollars as well as their personal information to tax scams each year, according to the IRS.

It’s why the IRS regularly issues “Scam Alerts” to warn taxpayers against the potentially damaging scams. What’s even more alarming is that rip-off artists working to rid you of your money or your identity are finding increasingly clever ways to reach into your pocket. In addition to ordinary taxpayers, scams now target tax professionals, human resource/payroll departments and others. Nearly any entity that might possess your private information can be subjected to a tax scam.

Most recently, an IRS Scam Alert warned of a complex scam where criminals steal client (i.e., taxpayer) data from tax professionals and then file false tax returns under these clients’ names, using the clients’ real bank accounts for refund deposits. Scammers then use a variety of different methods to take back the money once it’s deposited – sometimes even posing as IRS officials and threatening the victims. You can read the full Scam Alert here.

So, what can you do to protect yourself? The first step is to know how the IRS operates and to become somewhat familiar with the types of scams out there (although they are constantly changing and adapting): tax tips tray

IRS protocols. The Internal Revenue Service will NEVER initiate contact with taxpayers by email, text message or social media platforms to request personal or financial information. If this happens to you, it’s a surefire sign someone is trying to scam you.

Deceitful practices. As mentioned above, tax scams come in all kinds of forms – and are delivered to victims in snail mail, email, text message or phone calls. Don’t be fooled by professional looking letterheads and logos or official sounding tax issues raised in the communication. If you have any doubt at all as to its authenticity, do not respond in any way and contact someone you trust to verify the communication.

Variety of scams. As the earlier example demonstrates, scam artists are a clever bunch. There are a variety of ways they will try to wriggle personal information out of you. Whether by asking you to provide private information (“phishing”), impersonating IRS personnel via telephone calls or directing you to official looking websites that infect your computer with malware (making you vulnerable to hacking), criminal scammers will stop at nothing to steal your money.

So consider this a primer to the basics of tax scamming you need to know to protect yourself and your private information. Remember that the IRS will not contact you and request private information arbitrarily via email or text. And finally, always say no to information requests that you are not absolutely, 100 percent positive are authentic.

To get more information about tax scams and how to identify them, read this comprehensive IRS Tax Scam Alert.

Top Five Concerns of People Facing IRS Action

You’ve received a letter from the IRS telling you there’s a problem with your taxes. You’re not entirely clear on what the letter means. Yet you are sweating a little. You’re nervous about what happens and what steps you should take next. You’re anxious and are tempted to ignore it all.

Here’s your first step: DO NOT IGNORE THE IRS NOTICE. For your next step, read the following concerns that 20/20 most often hears from clients calling our office for the first time. With our 19 years of experience helping people overcome tax difficulties, we’ve heard just about every concern. Here are the top five concerns common to our clients. Taking Notes

1. Aggressive enforcement and liens

People who speak with 20/20 agents overwhelmingly express fear that the IRS wants payment immediately and by any way possible. Taxpayers want protection from aggressive enforcement actions like bank levies, accounts receivables levies, wage garnishments and asset seizure. While every person’s case is unique, we have a variety of tools we can use to intercede and ensure that these extreme IRS actions are avoided. In nearly every case, we are able to use these tools to give clients the time and space they need to establish compliance and form a strategy to meeting their tax obligations.

2. Difficulty dealing with or communicating with the IRS

It’s not surprising that the second most-frequent concern we hear is that resolving this issue will require inordinate amounts of time, effort and frustration. Who hasn’t sat on hold trying to reach an account service representative? Taxpayers envision a customer service nightmare multiplied tenfold by government inefficiency. Because we work with the IRS all the time, we’re familiar with the agency’s communications processes and we know how to reach the right person to get the right information. We take over communication and do it for the taxpayer, freeing them up to run their business – and their life.

3. Revenue officer showing up at place of business and employees or others finding out about liability

While the IRS is stepping up enforcement and collection efforts of unpaid or delinquent taxes (particularly employment taxes), the agency does work to respect and protect a taxpayer’s privacy. However, in a busy office where documentation and information is shared widely, it’s entirely possible that some news about tax issues may filter out to others. But any employee or other individual will feel less anxious when they know a qualified, experienced tax resolution company like 20/20 is working on the case. The alternative is to have employees or others worry that nothing is being done to manage the liability.

4. Debt to IRS growing out of control (penalties and interest accrual)

There are very few ways to avoid having to pay interest when a tax obligation is delinquent. However, 20/20 can make certain that all obligations, interest and even any penalties will be the least amount allowable under the law. The bottom line: Doing something to resolve the situation is always better than doing nothing.

5. Getting a good and manageable resolution.

Finally, 20/20 clients are worried about achieving a fair, manageable resolution that won’t break the bank and will alleviate their worries. Fortunately, we’ve been helping clients achieve this goal for almost 20 years so we can say with confidence that we can help most taxpayers. We’ll use our experience to obtain the best resolution available under your specific circumstances.

While reactions to potential IRS action vary, it’s fairly typical for clients to feel some or all of the above concerns. Some people seem unfazed and are not frightened of the IRS at all. Typically, this reaction comes from taxpayers who have dealt with the IRS previously. The strongest fear many people experience is that others (employees, spouses, friends, etc.) will discover the problem. There’s a certain stigma about owing money to IRS – and they worry what others will think.

But the truth is many people experience these types of problems and it doesn’t indicate any lack of character. Taxes are a complicated issue – and running a business is always challenging. What’s important is recognizing when you need help in order to keep any problems from becoming overly burdensome. That’s precisely why we exist.

Summertime Tax Tip: Amending a 1040 Return

As the IRS states, the tax code is a complex set of laws affecting virtually every American individual and business. Last year the IRS processed over 244 million tax returns and other documents. The volume is a tribute to the voluntary tax system as well as the IRS workforce.

Undoubtedly, however, the complexity and volume of our tax system means that errors are almost unavoidable. As representation experts we do our best to find and correct those errors made by the IRS. But, that’s just one side of the equation. Every year countless taxpayers ask us what to do if they discover an error on a return that was already filed. The short answer is to not panic and correct the mistake.

2020 Summer Tax Tip_FINAL_PNG

Questions about your unique situation? Learn more about ways we can help or feel free to contact us at any time!

To download a high-resolution version of this infographic, please click here

 

[Infographic] 5 Common Business Owner Payroll Myths: Debunked

When it comes to running a business, ensuring that payroll obligations are met, both to employees and all applicable taxing authorities, doesn’t come without challenges. While there are a wide variety of resources available to help businesses of all sizes manage their payroll obligations, perhaps no other challenge can be as “taxing” (particularly for small- to medium-sized companies) as ensuring that these obligations are met.

If you own a company, take some time to familiarize yourself with some of the most common myths many business owners believe when addressing their payroll tax concerns.

 

Five Common Payroll Myths Debunked

Questions about your unique situation? Learn more about ways we can help or feel free to contact us at any time!

To download a high-resolution version of this infographic, please click here

Holiday Hiring: Don’t Forget About Tax Regulations

Retailers and seasonal companies currently on a hurried hiring spree for the holiday season would be wise to slow down enough to ensure they are complying with all required tax regulations, according to experts in the tax resolution business.

“Because seasonal hiring often occurs in a hurry, it’s important that businesses adhere to their usual hiring policies and processes so they don’t overlook critical tax documentation and considerations,” said Brian Biffle, president of 20/20 Tax Resolution in Broomfield, Colo. “First and foremost, it’s important to remember that part-time and seasonal employees are subject to the same tax withholding rules that apply to any other employees.”  

To ensure against unexpected tax issues, it’s important that businesses have the resources and the record-keeping systems in place to manage an influx of temporary employees during the busy season, according to Biffle. Maintaining accurate records is not only critical with respect to payroll issues, but also down the road should problems arise. In addition, there are a number of other considerations that must be addressed, Biffle said. For example:

  • Correctly identifying employment status (1099 or W2)
  • Incorporating additional administrative costs (payroll management, for example) into hiring plans
  • Ensuring any potential health care coverage costs (if required for seasonal employees working 30 hours or more per week) are factored into hiring decisions – a rare requirement based on a variety of criteria but worth verifying when making hiring decisions
  • Anticipating the unexpected and planning accordingly

“The retail business especially can be unpredictable, particularly if a ‘hot’ item captures consumer attention creating additional hiring needs. So it’s smart for employers to examine all variables that may impact the bottom line – including hiring costs,” Biffle said. “It can be very easy to neglect costs like these during the rush of the season when business is plentiful, but doing so can put a business in a serious financial bind.”

Conversely, Biffle said that seasonal workers should pay attention to any tax implications created by accepting a holiday job. Workers should ensure they factor in tax withholding to cover any tax liability (whether done through the employer or as a self-employed individual), including federal income tax, state income taxes, Social Security and Medicare (FICA) taxes, as well as any local taxes that may be required.