Tax Resolution
There are so many bankruptcy attorneys that do not understand tax law and there are so many tax attorneys that do not understand bankruptcy law. If you have back tax problems call Mortensen Law Offices. Wayne Mortensen has discharged back taxes in bankruptcy. He understands both the rules in bankruptcy and has extensive understanding of tax problem resolution. Don't hire a one dimensional attorney. If you have tax debt call Mortensen Law Offices to see about discharge of back taxes in bankruptcy. If we cannot discharge them then we may discuss the following options:
Offer and Compromise
Currently Not Collectible
Partial Pay Installment Agreements
Installment Agreements
Penalty Abatement
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Offer and Compromise
Offer in compromise (OIC) is a tax resolution option provided by the Internal Revenue Service (IRS) that allows taxpayers to settle their tax debt for less than the full amount owed. Mortensen Law uses this powerful tool for taxpayers who are unable to pay their tax debt in full or who have a dispute with the IRS over the amount owed. The OIC process can be complicated, so it is essential to understand the requirements and qualifications before applying.
The OIC Process:::
The OIC process begins with the taxpayer submitting a proposal to the IRS that outlines the amount they can pay to settle their tax debt. This proposal is based on a formula that the IRS generates through a collection information statement. The IRS will then review the proposal and determine if it is reasonable and meets the requirements for an OIC. If the proposal is accepted, the taxpayer will have to pay the agreed-upon amount, and the remaining tax debt will be forgiven.
If the proposal is rejected, the taxpayer has the right to appeal the decision. The appeal process involves submitting additional information to support the proposal and explaining why the IRS should accept it.
Eligibility Requirements:
Not all taxpayers are eligible for an OIC. The IRS considers several factors when determining eligibility, including the taxpayer's income, expenses, assets, and liabilities. Here are the eligibility requirements:
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Taxpayer must be current with their tax filings and payments.
Before submitting an OIC, the taxpayer must be current with all their tax filings and payments. This means they must have filed all required tax returns and made all required tax payments for the current year and previous years.
222. The tax debt must be valid and owed to the IRS.
The tax debt must be valid, meaning it must be owed to the IRS and not to another party. The taxpayer must also have received a notice of assessment from the IRS indicating the amount owed.
3. The taxpayer must be unable to pay the full amount owed.
The IRS will only consider an OIC if the taxpayer is unable to pay the full amount owed. The IRS uses a formula to determine the taxpayer's ability to pay, which includes the taxpayer's income, expenses, and assets. Again this goes to the collection information statement commonly referred to as a 433 (A) OIC
4. The OIC proposal must be reasonable.
The OIC proposal must be reasonable and reflect the taxpayer's ability to pay. The IRS will consider the taxpayer's income, expenses, and assets when determining if the proposal is reasonable.
How to Apply for an OIC:
To apply for an OIC, the taxpayer must complete and submit IRS Form 656, Offer in Compromise. The form requires the taxpayer to provide detailed information about their income, expenses, assets, and liabilities. The taxpayer must also include a non-refundable application fee of $205.
In addition to the application form, the taxpayer must submit supporting documentation, including:
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Copies of their most recent tax returns
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Proof of income, such as pay stubs or profit and loss statements
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Proof of expenses, such as rent or mortgage statements, utility bills, and medical bills
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Proof of assets, such as bank statements, investment account statements, and property appraisals
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Proof of liabilities, such as credit card statements and loan documents
Once the IRS receives the application and supporting documentation, they will review the proposal and determine if it is reasonable and meets the eligibility requirements. If the proposal is accepted, the taxpayer will have to pay the agreed-upon amount within a specified period.
Conclusion
An offer in compromise is a powerful tax resolution option for taxpayers who are unable to pay their tax debt in full or who have a dispute with the IRS over the amount owed. It is a complicated process that requires careful consideration of eligibility requirements and the submission of detailed documentation. If you are considering an offer in compromise please call Mortensen Law Offices for a free consultation.
Currently Not Collectable
Currently not collectible (CNC) is a tax resolution option provided by the Internal Revenue Service (IRS) that allows taxpayers to temporarily delay collection activities due to financial hardship. CNC status does not eliminate the tax debt but rather puts a hold on collection activities for a certain period, typically up to one year. If the taxpayer's financial situation does not improve after the initial period, they can request to extend the CNC status.
To qualify for CNC status, taxpayers must meet specific criteria and provide documentation to support their financial hardship. Here are the eligibility requirements for CNC status:
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Inability to Pay
The taxpayer must demonstrate that they are unable to pay their tax debt due to financial hardship. This means that their income and assets are not sufficient to meet their necessary living expenses and pay the tax debt. The taxpayer must provide documentation to support their financial hardship, such as bank statements, pay stubs, and bills.
2. Current Tax Returns
The taxpayer must be current with their tax filings and have filed all required tax returns. This means that the taxpayer must have filed all tax returns for the current year and previous years.
3. Collection Statute Expiration Date
The IRS has a limited time to collect the tax debt, known as the Collection Statute Expiration Date (CSED). If the CSED is approaching, the IRS may not grant CNC status.
4. No Available Assets
The taxpayer must demonstrate that they do not have any available assets that could be used to pay the tax debt. This means that the taxpayer must not have any significant equity in assets such as real estate, vehicles, or investments.
5. Necessary Living Expenses
The taxpayer must provide documentation of their necessary living expenses, such as rent or mortgage payments, utilities, groceries, and medical expenses. The IRS has established standards for necessary living expenses, but the taxpayer may request adjustments based on their circumstances.
How to Apply for CNC Status
To apply for CNC status, the taxpayer must complete and submit IRS Form 433-F, Collection Information Statement. The form requires the taxpayer to provide detailed information about their income, expenses, assets, and liabilities. The taxpayer must also include documentation to support their financial hardship, such as bank statements, pay stubs, and bills. In most instances you must have filled out a 433 -f but the IRS will not usually require that you send it in. They will want you to have access to it during a phone consultation to determine eligibility for the CNC.
Once the IRS receives the application and supporting documentation, they will review the information and determine if the taxpayer is eligible for CNC status. If the IRS grants CNC status, they will place a hold on collection activities for a certain period, typically up to one year. If the taxpayer's financial situation does not improve after the initial period, they can request to extend the CNC status.
It is important to note that interest and penalties will continue to accrue during the CNC status period, and the taxpayer may still receive notices and reminders from the IRS regarding the tax debt. The taxpayer should continue to file all required tax returns and make payments if possible, even if the payments are not enough to fully satisfy the tax debt.
Conclusion
Currently not collectible status is a tax resolution option for taxpayers who are facing financial hardship and unable to pay their tax debt. To qualify, taxpayers must meet specific criteria and provide documentation to support their financial hardship. If you are considering currently not collectible status, it is essential to seek the guidance of a tax professional to ensure that you meet the eligibility requirements and submit a complete and accurate application.
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Taxes Are Complicated
Our Process Is Simple
Step One
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Step Two
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Step Three
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Lorem Ipsum Is Simply Dummy TexT
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There Are Many Variations Of Passages
It is a long established fact that a reader will be distracted by the readable content of a page when looking at its layout. The point of using Lorem Ipsum is that it has a more-or-less normal distribution of letters, as opposed to using 'Content here, content here', making it look like readable English. Many desktop publishing packages and web page editors now use Lorem Ipsum as their default model text, and a search for 'lorem ipsum' will uncover many web sites still in their infancy. Various versions have evolved over the years, sometimes by accident, sometimes on purpose (injected humour and the like).
There are many variations of passages of Lorem Ipsum available, but the majority have suffered alteration in some form.
It is a long established fact that a reader will be distracted by the readable content of a page when looking at its layout. The point of using Lorem Ipsum is that it has a more-or-less normal distribution of letters, as opposed to using 'Content here, content here', making it look like readable English. Many desktop publishing packages and web page editors now use Lorem Ipsum as their default model text, and a search for 'lorem ipsum' will uncover many web sites still in their infancy. Various versions have evolved over the years, sometimes by accident, sometimes on purpose.
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