Tax Debt Relief
When it comes to audits and actions aimed at debt collection, the IRS is notorious for being relentless. To tackle tax debt, it is often insufficient to have simply a layman's understanding of tax laws and collection procedures. Evidently, each year, millions of taxpayers consult a tax accountant, tax lawyer and/or other professionals specializing in restoring consumers to a debt-free existence. Tax debt companies focus on 1) keeping tax collectors at bay, 2) assisting taxpayers in eliminating tax debt, 3) helping debtors pay off their taxes faster, 4) protecting clients against intimidation, harassment, error, or abuse on the part of a tax agency, state or federal, and 3) stopping IRS tax debt from accruing by way of interest and penalties. To rebuild their financial future, taxpayers should focus their search on tax debt companies that are reputable and reliable. Two consumer groups providing feedback about these firms' trustworthiness are the Rip-Off Report and the Better Business Bureau (BBB), both of which may be found online. Tax services are offered by a host of different specialists, and tax debt companies which typically include a 1) tax attorney, 2) tax preparer and 3) tax accountant. What follows is a brief overview of the major players in the tax resolution arena:
1. Tax Accountant
There are numerous benefits to be reaped from hiring a tax accountant, a professional who is well-versed in the complex nuances of tax law and who dispenses comprehensive tax advice. Typically, an accountant provides the following tax services:
- Individual, partnership and corporate tax return preparation
- Preparation of tax returns for the 50 states
- Tax planning
- Verification of tax returns for accuracy
- Conversion of personal expenses into deductions for IRS purposes
- Assistance with filing back taxes
- Audit representation/Defending against an IRS audit
- Help with paying off a tax debt
2. Tax Lawyer
A tax attorney is a specialist in all areas of tax law and has an in-depth knowledge of IRS procedures and the most up-to-date tax regulations. This makes him or her effective and qualified in dealing with a state or federal tax agency and in guiding taxpayers towards a resolution of their tax liabilities via a wide variety of settlement methods. The vast majority of tax lawyers offer free consultations. Specifically, they extend the following types of tax assistance to clients:
- Tax resolution for unfiled tax returns
- Tax fraud defense
- Reduction of payment schedule and/or total tax delinquency
- Ceasing or reducing harassing phone calls from Uncle Sam
- Quick and effective negotiation of IRS tax settlements and payment plans
- Obtainment of tax refunds
- Assistance with back taxes
- Putting a stop on property seizures, tax levies and bank levies
- Performing numerous tax relief services.
Among the tax debt resolution strategies employed by the average tax attorney and achieved on behalf of the client are (1) an offer in compromise (or settlement for less than the full sum owed), (2) interest and penalty abatement, (3) an installment agreement, (4) uncollectable status, (5) forgiveness of penalties, and (6) IRS appeals and removal of tax liens, levies, and wage and bank garnishment.
3. Tax Preparer
The tax service that is generally undertaken by this professional is income tax preparation. A tax preparer also offers the following services:
- Review of income tax returns (oftentimes for free)
- Audit assistance
- Thorough identification of deductions and credits that the client qualifies for
- Free e-filing with paid-for tax preparation
4. IRS Certified Volunteers
Tax assistance is available from the IRS through its Tax Counseling for the Elderly (TCE) Program and Volunteer Income Tax Assistance (VITA) Program, which offer free tax assistance to eligible candidates. VITA is generally available to taxpayers who are unable to prepare their tax returns and whose income is in the low to moderate range (usually, up to $40,000). Trained volunteers assist individuals with special credits, such as the Child Tax Credit, the Credit for the Elderly, and the Earned Income Tax Credit (EITC).
5. Online Tax Assistance
Taxpayers will also find a multitude of websites that offer gratuitous assistance with tax preparation forms as well as free e-filing. Online tax assistance is also available in the form of tax advice and counseling, and CPA advisors are on hand to answer taxpayers' questions and to review their forms prior to electronic filing.
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