Knowledge is power when battling the IRS – the most brutal and ruthless collection agency on the planet. To make things more urgent, IRS enforcement is only getting more aggressive – raising the stakes to a new level. And falling for common tax relief myths can endanger your wealth, health and liberty. You owe it to yourself to learn the reality of these myths. And you don’t have to get to the bottom of these all on your own. Getting the right help from an IRS tax attorney or Certified Tax Resolution Specialist is key so you don’t have to decipher the difference between fact and fiction on your own.IRS Myth #1 – Once the IRS creates a substitute return for an unfiled tax return, you’re toast: First of all, regardless of whatever tax relief myth you’ve heard, you have the right to file your original return, no matter how late. If you have failed to file taxes in the past and feel like the IRS creates a substitute return, there is relief available. The average client seeking IRS tax relief who visits an income tax attorney or Certified Tax Resolution Specialist has four to eleven years of unfiled returns. To get the best results, a good tax professional should represent you before the IRS to get you the tax relief you deserve and help you turn your financial life around.
IRS Myth #2 – Filing a tax extension protects you from aggressive IRS scrutiny: A tax extension is not IRS tax relief! According to most tax attorneys, this myth causes the most trouble. What many people don’t understand is that filing a tax extension just puts off the inevitable, because it’s not an extension of time to pay, it’s just an extension of time to file. In this tough economy, many people are living from paycheck to paycheck, but the tax relief starts with playing by the rules. Any Certified Tax Resolution Specialist will tell you that no matter what you believe about IRS tax relief, the most important thing to do is be prepared to file your return on time, even if you don’t have the money to pay your IRS back tax bill. If you can’t afford to pay your IRS back taxes, you can still file your taxes on time and save 25% on the failure to file penalty right off the bat. Saving 25% on your IRS back tax bill for the cost of a stamp is the kind of income tax relief that anyone can get behind.
IRS Myth #3 – You have to pay your IRS tax bill in full: The average taxpayer also may not know that the IRS offers help with payment options for struggling taxpayers who can’t afford to pay their tax bill in full. Most Certified Tax Resolution Specialists will warn you that setting up an IRS payment installment plan can be the most expensive way to handle your IRS back tax debt because you are paying the full amount owed plus interest plus fees. A good income tax attorney can reduce your IRS back tax and IRS penalty debt burden, in some cases giving you the ultimate tax relief by eliminating your tax burden entirely.
IRS Myth #4 – You don’t file your taxes because you’re lazy or you don’t care: The most destructive myth is the one that eats us from the inside. Late filers have a lot of guilt because they believe that their lack of income tax filing is a result of laziness. We all know that everyone procrastinates to some degree, especially when it comes to filing their taxes. But most tax procrastination isn’t caused by laziness – it is often caused by anxiety. Procrastination can be paralyzing, and it can be detrimental to your overall financial well being – especially if you have unfiled returns or owe the IRS back taxes, which exposes you to IRS audits, liens, wage garnishments, penalties, fines and even jail time for tax fraud.
The sad part of procrastinating and having unfiled tax returns is that people who fear taxes may actually be missing out on some tax relief including refund money that would rightfully be theirs. According to the IRS, 1.3 million individuals who failed to file a tax return in 2004 left a total of $1.2 billion in unclaimed refunds. Half of those nonfilers would have received a refund of more than $552. Some also may have been eligible for the refundable earned income tax credit. If the idea of filing all those delinquent tax returns gives you crippling anxiety, get a tax professional to get you the relief (and the mental release) you deserve.
IRS Myth #5 – You’re broke and out of work so you can’t pay the IRS: The IRS myth that could be the most costly hits the people who need the relief the most. If the Great Recession has hit you hard, you may feel that dealing with the IRS when you need income tax relief is the worst thing you could do. After all, the IRS jumps ahead of all creditors and has the power to garnish wages, levy bank accounts and more. But even the IRS knows it can’t squeeze income tax money out of a stone. If you owe IRS back taxes and you’ve been hit by hard times, this is could be the ideal moment to contact the IRS in order to have your tax attorney to negotiate an Offer in Compromise. Now you have the leverage to reduce or in some cases eliminate your tax debt based on your current ability to pay. That means being out of work and heavily in debt has one silver lining. Talk about relief, you might be able to get your IRS back tax debt down to zero.
IRS Myth #6 – Your chances of an IRS audit depend on when you file: These days there is no sweet spot filing date that ensures you won’t get audited. The date you file your tax return has very little impact on whether you get audited. Being audited has more to do with the type of return you file. If you list lots of suspicious deductions, you’ll get audited. If you declare outlandish business losses, you will be audited. If the income the IRS says you’ve gotten (from W-2s and 1099 forms) is less than the amount on your return, you will get audited. If your name is Willie Nelson or Wesley Snipes, you WILL get audited. If you’re introuble, income tax relief won’t come from a magic date. You’ll get satisfaction from hiring a good income tax attorney or Certified Tax Resolution Specialist to work their magic.
IRS Myth #7 – You need to owe big bucks before you should hire an income tax attorney or tax resolution specialist: This IRS myth can really cost you, lots of money and, in some cases, your freedom. Beyond simple tax relief, any time you are facing potential prison time, you need professional tax help from an experienced Certified Tax Resolution Specialist. Since the beginning of our democracy when you faced the government you had the right to have someone represent your interests. Tax relief is no exception.
Remember that the tricky part about owing the IRS money is that when they ask you to pay up, you may end up owing them more than just your back taxes! Hiring an income tax attorney can help you save more than just IRS penalties, so even if you think you can’t afford it, a Certified Tax Resolution Specialist can save you money and make sure you get out of IRS debt for good.
For more information on how to get IRS tax relief, visit www.taxresolution.com for a free tax relief consultation or call
Michael Rozbruch is one of the nation’s leading tax experts. He is a Certified Tax Resolution Specialist (CTRS), licensed CPA and CEO & founder of Tax Resolution Services. He helps individuals and small businesses solve their IRS problems and is dedicated to educating the public on tax planning and other strategies for managing their personal and business finances.
