You may be able to resolve your case with the IRS appellate division before going to trial. Prepare for increased scrutiny by the Internal Revenue Service. As Washington seeks ways to reduce the budget deficit, IRS officials face intense pressure to raise more revenue. The agency plans to conduct more audits, especially of high-profile taxpayers or those who are self-employed and negotiate large amounts of cash.
The IRS has also increased pressure in areas such as foreign tax evasion, including undisclosed foreign bank accounts. Already a member? Sign in. Choosing the right tax relief method when you can't pay your taxes can eliminate much or all of your tax debt, which can amount to thousands, even tens of thousands, of dollars and help you get back on track financially. Other cases can be quite complex, especially if they concern legal issues.
I have resolved cases with an auditor over the phone in the early stages of auditing and others were resolved with IRS lawyers years later, after a United States Court of Appeals (just below the U.S. Supreme Court) ruled on the case. Before you decide to fight Uncle Sam, make sure your profits are worth it. Waging a battle against the IRS is no easy task.
If you have no way to pay the debt, you can ask the agency to commit the amount you pay. You have to be in a pretty bad financial situation to be able to fulfill the commitment. Last year, the acceptance rate for these commitments was 20 percent, according to Eric Smith of the IRS. If you attach it to the return, they can review the payment proposal immediately.
There is a misconception that you can only charge fees if your case goes to court and is successful. You can charge fees even if you are successful in the IRS administrative process. There is no need for the case to actually go to court. You can challenge fines and accrued interest by requesting a reduction in penalties based on reasonable cause.
In short, you will be asked to tell the IRS your story, including the circumstances that led to and during the accumulation of the tax debt, and to request a reduction or elimination of penalties. It's hard to predict the cost of fighting the IRS, in part because the case can be resolved at many different administrative and judicial levels.
