Atlanta/Alpharetta/Norcross CPA Teaches Atlanta Taxpayers How to Address Unpaid Income Taxes/Back Taxes
Atlanta/Alpharetta/Norcross CPA Teaches Atlanta Taxpayers How to Address Unpaid Income Taxes/Back Taxes
I recently got a letter from the IRS saying that I owe tens of thousands of dollars in back taxes . I remembered that I worked a job that that was a From 1099/Independent Contractor but forgot to pay for the taxes back for 2006 to 2009. I would like to know if its possible to pay for this in a monthly payment and maybe try to get the payment lowered. reason will I picked you guys is because your faith in our Lord Jesus. I am a Christen and have made Christ the Lord of my life. I would like to talk to you guys on the phone. Call me at any time.
Below is my response:
Setting up an Installment Agreement
Georgia/States & the IRS will work with taxpayers to pay the monies owed over time. This option requires the taxpayer to file a form requesting that a specified amount be paid monthly over time. The IRS then has to accept the plan prior to it becoming effective. Though this is a practical way to address a larger balance over time it does not stop the assessment of penalties and interest which will continue to accrue until all monies are paid in full. Thus, it is most advantageous to consider procuring the funds from other sources as these finance/carrying charges are usually much less than that of the Internal Revenue Service.
Options for Penalty Abatement
The IRS can use a myriad of penalties and interest to encourage compliance, including information return penalties, non-filing, non-payment, estimated payment, and failure to deposit penalties. If you are assessed penalties for any reason you still have options. Both the IRS and states will work with you to address your outstanding taxes, interest, and penalties. One of the first defenses to explore is whether you have reasonable cause for your original failure to address you past returns and outstanding monies. If you are to be granted relief under these provisions you will need to be able to show that you have exercised ordinary business due diligence and care in calculating your tax obligations. You will need to be able to illustrate that obligations were generated when circumstances existed which were beyond your control contributed to the monies being owned and assessed.
Unfortunately the lack of knowledge of a law is not a valid defense that can be successfully used when attempting to request penalty abatement, as you are required to be prudent in addressing your obligations and responsibilities. Our tax system is one of voluntary compliance and tax penalties are the vehicle by which the IRS uses to ensure that you are financially motivated to file and pay your taxes as they become due. The IR S’s goal is to provide a consistent and fair methodology to assessing penalties to provide civil tax penalties to ensure ones tax obligations are satisfactorily addressed.
When evaluating penalty abatement issues the IRS will consider whether or not a penalty will cause a significant hardship such as a levy might impair a taxpayer’s ability to acquire needed medical care. As well a death, serious illness, or unavoidable absence may establish reasonable cause for considering penalty abatement. However items such as forgetfulness, ignorance of the law, and making a mistake are not generally allowed as reasonable cause in evaluating penalty abatement issues. The IRS will work with you to set up an installment agreement to pay outstanding monies as well as perhaps an Offer in Compromise if you qualify.
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And this is only some of the information available on our web site. You also have at our blog a host of other varied and timely tax and business management issues you can use.
John Dillard, CPA of His CPA, PC (An Atlanta Christian CPA firm) 1940 Woods River Lane, Duluth, GA 30097 Phone 770-814-9304 http://www.hiscpa.com/ To retain John Dillard CPA (An Atlanta Christian Speaker/Author) for your business group or church congregation, you can contact him today at 770.814.9304
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We advise clients on: IRS representation, Offer in Compromise, Tax Problems, Incorporation in Georgia, Corporate and Personal Income Tax Returns, Part-time CFO, Virtual Controller, Business Planning, Offer in Compromise, Back Taxes, Business Acquisitions/Sales, Forensic Accounting, Business Valuations and Bookkeeping.