The IRS has a structured process for settling tax debts. This is handled through the IRS’s ‘offer in compromise’ program. The program itself has several different sections or workstreams. The primary workstream is the ‘doubt as to collectiblty’ workstream. This refers to offers that are submitted by taxpayers based on their inability to pay. Assuming…
Category: IRS Debts
IRS Debts
Tax debts owed to the IRS, including unpaid taxes, penalties, and interest. Give us a call to see how we can help, (713) 909-4906.
Discharging Tax Debts in Bankruptcy: The Three-Year Lookback Period
Tax debts in bankruptcy are a weighty and serious topic. Statistics show that in 2019, over 770,000 individuals filed for bankruptcy in the United States, and approximately one-third of those involved some type of tax debt. This highlights the common struggle individuals face in paying their tax obligations. Bankruptcy is a common method for resolving…
The Disqualified Employment Tax Levy
Taxpayers generally know that an IRS levy is not a good thing. Most have some sense that it can affect their financial well-being. If they have not been subject to an IRS levy, this may be all they really know about it. The term “levy” is a verb that, in the context of the IRS,…
If a Trustee Owes Taxes, Can the IRS Seize Trust Assets to Satisfy the Tax?
The IRS has broad powers when it comes to collecting unpaid tax debts, but its authority is not without limits. For example, there are limits on what property the IRS can seize if the property is held by a third party. This can include property held in trust. Consider the situation where a father creates…
Navigating IRS Collections During an Economic Downturn
The financial downturn has left many taxpayers struggling with unpaid tax debts just as IRS collection efforts ramped up. Though a challenging time, the economic turmoil also created opportunities to negotiate with the IRS from a position of strength. Negotiating with the IRS is always challenging. But with proper diligence and records, taxpayers can use…
IRS Collections for Payroll Taxes & Single Member LLC Owners
The IRS has broad collection powers. These powers generally trump state law. This is even true of state Limited Liability Company (“LLC”) rules that prevent parties from suing or reaching the LLC’s assets. There are nuances to these rules when it comes to income and payroll taxes. The payroll tax rules have changed completely. Many…
Aggressive State Tax Collections
If you owe back taxes, the general rule is that you pay the state and then negotiate with the IRS. The reason for this is that the states are particularly aggressive when it comes to collecting back taxes. Some states are more aggressive than others. And their practices vary over time. In the event of…
Offer in Compromise Deemed Accepted by the IRS
The IRS consumes volumes of information. It processes this information largely by processing paper forms. This includes paper forms submitted by you, the taxpayer and your tax attorneys, and by internal forms created by IRS employees. This inefficient paper form submission and processing is complemented by an insistence on sending taxpayer notices by mail. The…
Prepaying Taxes Before Bankruptcy Filing
Unlike tax laws that establish a specific amount due, bankruptcy laws define what is not due. These conflicting policy objectives can lead to unique outcomes in cases of unpaid taxes. For instance, what happens to taxes held by the IRS but not yet applied to a future tax liability when a taxpayer overpays their taxes…
Bankruptcy Filing Does Not Prevent Innocent Spouse Relief
There are often times when different government agencies with different clients and missions are at odds with one another. This is frequently true when it comes to the IRS and the bankruptcy trustee. The IRS is tasked with protecting the government fisc. The bankruptcy trustee is tasked with protecting the estate for the benefit of…